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Green Investment: From Sustainability to Securing Early-Stage Funding
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Green Investment: From Sustainability to Securing Early-Stage Funding

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December 17, 2021

Raising Partners was created to bring a much needed specialism…

There is a newfound responsibility and expectation for investors to understand whether businesses in their portfolio are meeting ESG criteria. As climate activist Greta Thunberg recently remarked while abruptly leaving a carbon offsetting meeting, the public will no longer be duped by distracting greenwashing, be it pseudo-sustainable campaigns or unrealistic pledges. The rise of verified certifications, like B-Corp, are playing a pivotal role in helping investors identify which businesses are legitimately committed to sustainability, taking the onus off individual due diligence with internationally recognised standards of practice. 

An increasing number of investors are embedding environmental, social and governance (ESG) policies into their investment portfolios. In doing so, they are not only protecting the planet, but they are also following the money. Sustainability finance expert, Mark Lancelott, predicts that “by 2025, a third of the world’s assets under management globally will be ESG investments”, suggesting that this shift in funding requisites will also shift access to capital, forcing companies to respond to climate change and embrace impactful sustainability. 

In September of this year, Raising Partners Angels – our investment syndicate – made its first investment, backing Zero Petroleum: a British technology company producing net-zero synthetic fuels, founded by Formula One legend Paddy Lowe. As a group, Raising Partners Angels is sector-agnostic, but wholly committed to investing in companies that are making a significant impact on people, processes or the planet. Zero Petroleum’s commitment to producing sustainable forms of energy made it a fitting debut investment for the syndicate, which includes former Formula One Champion Damon Hill as an investor. 

How to Secure Early-Stage Investment

Even the most innovative startups tackling climate issues can fall at the first fundraising hurdle if they’re not sufficiently prepared. At Raising Partners, we guide entrepreneurs through the funding landscape with expert advice and education. With tailored proposals, investment strategies, pitch-decks and valuation analyses, we provide our clients with a roadmap through the potentially treacherous fundraising process, from the first angel deal right through to potential stages to exit. It is our mission to level the investment playing field, demystify the funding process and prevent young, innovation-led businesses from financial failure. 

We find that most early- stage companies make similar mistakes when first attempting to raise capital, but luckily there are some simple tricks to avoid these common pitfalls:

Be prepared: The saying “failure to prepare is preparing to fail” couldn’t ring truer in the world of fundraising. Too often business owners leave too little time to raise investment, which significantly reduces their chances of success. Raising capital – from starting out to cash in the bank – typically takes between 4 and 6 months. By catering to this time frame, entrepreneurs can enjoy the luxury of time, rather than the pressures of a dwindling cash flow. 

See Also
When global labour market data is released, headlines tend to fixate on a single metric: unemployment. This year is no different. According to the latest figures from the United Nations and the International Labour Organisation, global unemployment remains relatively stable at just under five per cent. At face value, this suggests a labour market that is holding firm despite economic uncertainty, geopolitical instability and technological upheaval. In reality, it masks a serious and underreported problem: the true global jobs crisis is not a lack of work, but the growing scale of informal work. More than 2.1 billion people worldwide are employed in the informal economy, including misclassified workers operating outside effective regulatory coverage, where employment is typically unregistered, contracts are absent or unenforced, and access to labour rights and social protections is limited or non-existent. That represents a large portion of the global workforce. If unemployment reveals how many people cannot find work, informality shows how many are working without protection or long-term opportunity. Informal work is often associated with developing economies or unregulated sectors. However, this form of work is increasingly occurring within developed economies and regulated sectors, hidden within otherwise legitimate, fast-growing small and medium-sized enterprises – and this is often unintentional. For both businesses operating solely in domestic markets and those that have expanded abroad, adopting new workforce models and attempting to respond to rapid technological change, the crisis of informality is emerging in three key areas. The first is worker misclassification. Individuals are engaged as independent contractors but operate in practice like employees – working fulltime, at set hours, for years at a time. This is particularly prevalent in gig and platform-based roles, where algorithms determine pay, hours and performance without considering employment rights. Gig and platform work often presents as flexible and empowering, however, in practice, many platforms exercise employer-like control over payment, performance management, hours, and length of engagement, while explicitly avoiding employer obligations such as tax filings and the provision of statutory benefits like annual leave and healthcare. The result is a growing cohort of workers who fall between legal categories, carrying the risks of self-employment without the autonomy or protections that should accompany this mode of work. The second area is cross-border remote work, where informality can inadvertently arise. With post-COVID remote working models here to stay, companies are directly hiring overseas talent, assuming that because the worker is not based in the company’s home country, local employment laws do not apply. Where employment is not properly registered (whether by the employer and/or employee), local labour law is not applied, or social security obligations are misunderstood or ignored, these arrangements can slip into a form of modern informality, even where the relationship appears to be formal on the surface. This is often the point at which organisations begin to seek external guidance. In many cases, neither party fully understands the legal implications of the arrangement, which leaves both employer and worker exposed. We frequently see organisations approach us when a specific issue surfaces, such as payroll inconsistencies, questions around benefits entitlement, or concerns raised by the workers themselves, including registration process failures. Business leaders should also be aware that permanent establishment risk can arise if a remote employee is deemed to represent the company locally, which can trigger corporate tax obligations. Social security errors can happen when contributions are not made correctly in either jurisdiction, leaving workers without coverage and employers facing backdated liabilities. Meanwhile, employment law conflicts can emerge when contracts fail to meet the requirements of the host country regarding notice periods, benefits or termination rights. The third driver of informality is structural. These arrangements are becoming more common as artificial intelligence and evolving workforce models outpace regulation. Businesses are innovating at speed, but legal frameworks are struggling to keep pace. The UK’s Employment Rights Act offers a clear case study of the direction of travel. Worker protections are expanding, classification rules are tightening and enforcement is becoming more coordinated across agencies. Informal arrangements that once sat in legal grey areas are moving firmly into view and what was previously tolerated is falling under scrutiny. The challenge is that informality is rarely a deliberate choice. For many growing organisations, it becomes the default because compliant pathways are complicated and difficult to navigate alone, particularly across multiple jurisdictions. Legal advice, payroll, tax, HR, and immigration compliance are often siloed, leaving gaps that businesses may not even realise exist until a problem arises. For instance, digital nomad visas are often viewed as providing holders with wholly compliant right to work status, however employers may not realise that this is not always the case and contracts may not reflect the correct legal status or entitlements. Addressing informality requires a change in how we think about employment at a global level and recognising that flexibility and compliance are not mutually exclusive. Businesses need models that allow them to access global talent quickly while ensuring workers are properly employed and protected under local law. As attention remains fixed on unemployment figures, informality continues to expand beneath the surface. It is this hidden cohort of workers, contributing economically without security or rights, that represents the real crisis in the global labour market. Solving it will require coordinated action from policymakers and businesses alike, and a commitment to building workforce models that are not only innovative, but sustainable and fair.
Neupulse raises £3 million for delivery of neurotherapeutic technology

Be clear: Investors see thousands of pitches a year, and so it’s worth investing time and money into making your pitch deck stand out from the crowd. Be clear, concise and accurate in what stage your company is at and what you’re hoping to raise. The easier you make it for investors to understand what you’re after, the greater your chances are of getting it. 

Be realistic: Startups founders are characteristically ambitious and assured in their businesses: it’s this attitude that fuels their entrepreneurial spirit. However, you must be realistic about what valuation you can command when raising capital. If you can’t explain and defend the rationale behind the numbers, investors are unlikely to take you seriously. 

Climate change is an all-encompassing, systemic challenge, which no individual investor, startup or sector can solve. The key to driving impact at scale is collaboration: where innovation and investment come together to drive lasting change. 

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