New Wave.

Subscribe to the newsletter:New Wave | Hugo Rauch | Substack****New Wave is supported by:Evertrace: the leading founder detection engine for VCs. It traces signals across the digital landscape to uncover emerging founders earlier than anyone else, so you meet tomorrow’s founders today.I use it myself to source more deals at Climate Club, and I LOVE it. See what Evertrace can do for you here, or ask me for an intro and get a little something from the team ;)***🌊 Orchestrating the Energy TransitionWhy the biggest opportunity in energy may not be inventing new technology, but making the entire system work better.We’re joined by Julia Padberg, Partner at SET Ventures, one of Europe’s longest-standing specialist energytech investors. SET has been investing in the energy transition since 2007 — long before power became one of venture capital’s hottest markets.In this episode, we unpack what nearly two decades of energy investing teaches you about building enduring venture returns — and why Julia believes the energy transition is increasingly an integration challenge, not a technology challenge.As more investors rush into power, SET is taking a different approach: staying disciplined on valuations, backing companies that own critical customer interfaces, and looking for the orchestrators capable of connecting software, hardware, assets and capital.We also dive into one of the most interesting emerging models in climate venture: blended capital. Companies such as Decade Energy and Enrise can use infrastructure financing for physical assets while venture capital funds the technology and operating company — potentially allowing them to scale physical infrastructure without destroying venture-level returns.In our conversation, we covered:→ How do you build a venture firm that lasts? Why SET’s longevity comes down to specialization, network, discipline and becoming a trusted partner to both founders and LPs.→ Why everyone suddenly wants to invest in power. Energy security, electrification and sustainability are converging — but more capital also means higher valuations and more competition.→ Why SET doesn’t chase the hype. Entry valuation still matters in a European energy market where unicorn exits remain relatively rare.→ The real bottleneck in the energy transition. Julia argues that we already know how to make solar panels, batteries and EVs cheaper. The next challenge is coordinating millions of distributed energy assets.→ Why orchestration could create the biggest companies. The winners may be businesses that combine software, hardware, financing and services into one simple customer proposition.→ Can flexibility markets become overcrowded? Julia explains why the absolute volume of flexibility needed could continue increasing as intermittent renewable generation grows.→ The rise of blended capital models. How venture-backed companies can separate their technology stack from their capital stack using SPVs and infrastructure financing.→ Why infrastructure capital can actually increase venture returns. Rather than forcing VCs to fund batteries, solar or charging infrastructure, asset financing can remove one of the biggest constraints on scaling.→ Where AI fits into energy. From biodiversity monitoring around wind farms to infrastructure operations, Julia sees opportunities for AI to replace expensive legacy systems with cheaper, more intelligent solutions.→ Energy security is becoming an investment category. Cybersecurity, physical infrastructure monitoring and decentralised energy systems are moving higher on the agenda.→ Europe’s fragmentation is both a problem and a moat. Different regulations, grids and market structures make expansion harder — but companies that learn to navigate that complexity can build powerful competitive advantages.→ Why European startups don’t always need to internationalise immediately. In enormous energy markets such as Germany, owning a large portion of the value chain can create very large businesses without expanding into ten countries from day one.And Julia leaves us with three lessons from a decade of investing:1. The energy transition is an integration challenge.System integration and great business models can matter more than another silver-bullet technology.2. Value capture matters as much as value creation.Creating value for the energy system isn’t enough — the best businesses position themselves at critical interfaces where they can actually capture it.3. The best founders make complexity feel simple.Customers don’t want to understand every layer of the energy system. They want a solution that saves money, removes friction and makes saying yes obvious.***✨ Leave a review on Apple Podcast and Spotify to support the show. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit newwavenewsletter.substack.com

Subscribe to the newsletter:New Wave | Hugo Rauch | Substack****🌊 Financing the Hardware EraWhy climate founders need to stop treating equity as the default way to pay for CapEx.We’re joined by William Godfrey of Tangible, who has spent the past few years developing a thesis around how climate and hardtech founders should combine equity, debt, equipment finance, asset-backed lending, project finance, and other forms of capital.Because one thing is becoming increasingly clear:We’re not going to solve climate change through software alone.Climate companies need factories. Equipment. Batteries. Robots. Infrastructure. Physical assets.And financing all of that with venture equity can become an extraordinarily expensive mistake.In this episode, we go deep on how founders should actually finance capital-intensive growth — and why the best climate companies may increasingly need to become as sophisticated at financial engineering as they are at technical engineering.One framework from William stuck with me:Equity is for uncertainty. Debt is for repeatability.Equity makes sense when you’re funding something that has never been done before: R&D, prototypes, first-of-a-kind technology, new teams and markets.But once you’re repeatedly deploying an asset with increasingly predictable economics, a different pool of capital becomes available.And learning how to access it can fundamentally change the economics of the company. Listen to this episode to learn more or read this guide by Tangible. ✨ Leave a review and share the episode if this conversation challenged the way you think about growth, innovation, and sustainability. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit newwavenewsletter.substack.com

Subscribe to the newsletter:New Wave | Hugo Rauch | Substack****🌊 Water’s Mispriced OpportunityWhy one of the world’s most essential markets may also be one of venture capital’s most overlooked.Ahead of The Drop in Malmö, we’re joined by Steve Kloos, Partner at Burnt Island Ventures, a venture firm dedicated exclusively to investing in water technologies.Water is foundational to life, and to the economy. Yet despite roughly $1.6 trillion in annual global spending, Steve argues it remains surprisingly underinvested by venture capital.In this episode, we approach water almost like a course: starting with the fundamentals, mapping the biggest problems and technologies, and asking a more provocative question:Could water actually be one of the more compelling venture categories today?Steve’s thesis comes down to a simple dynamic: entry valuations remain relatively reasonable, while the exit market is getting stronger. At the same time, climate change, industrial demand and water scarcity are forcing customers to spend.In our conversation, we covered:→ Why water is becoming impossible to ignore, from droughts and floods to industrial growth increasingly constrained by water availability.→ Why water has historically struggled to attract venture capital, and why Steve believes the market is beginning to shift.→ The “buy low, sell high” thesis for water, including why entry valuations can still be significantly lower than in hotter categories such as energy, AI or robotics.→ Why exits may matter more than IPOs, and how strategic buyers and private equity are acquiring emerging water-tech winners before they reach the public markets.→ Where the opportunities are today, advanced treatment, desalination and reuse, software, sensing, industrial water, insurance and climate resilience.→ Why industrial demand could become a major driver, particularly in semiconductors and other manufacturing processes requiring large volumes of ultrapure water.→ Where investors can get caught by hype, from ballast water to large-scale atmospheric water generation.→ How desalination could evolve, including subsea approaches designed to reduce energy consumption and environmental impact.Steve also walks through Burnt Island’s own experience. Its 2021 vintage Fund I made 18 investments and has already recorded three exits, including SewerAI, while beginning to return cash to investors.The broader argument is simple:Water may still look like a difficult, specialised category from the outside. But that complexity may be exactly why the opportunity remains underpriced.And as Steve puts it, the picture is becoming more obvious.✨ Leave a review and share the episode if this conversation challenged the way you think about growth, innovation, and sustainability. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit newwavenewsletter.substack.com

Subscribe to the newsletter:New Wave | Hugo Rauch | Substack****🌊 Financing the Hardware EraWhy climate founders need to stop treating equity as the default way to pay for CapEx.We’re joined by William Godfrey of Tangible, who has spent the past few years developing a thesis around how climate and hardtech founders should combine equity, debt, equipment finance, asset-backed lending, project finance, and other forms of capital.Because one thing is becoming increasingly clear:We’re not going to solve climate change through software alone.Climate companies need factories. Equipment. Batteries. Robots. Infrastructure. Physical assets.And financing all of that with venture equity can become an extraordinarily expensive mistake.In this episode, we go deep on how founders should actually finance capital-intensive growth — and why the best climate companies may increasingly need to become as sophisticated at financial engineering as they are at technical engineering.One framework from William stuck with me:Equity is for uncertainty. Debt is for repeatability.Equity makes sense when you’re funding something that has never been done before: R&D, prototypes, first-of-a-kind technology, new teams and markets.But once you’re repeatedly deploying an asset with increasingly predictable economics, a different pool of capital becomes available.And learning how to access it can fundamentally change the economics of the company. Listen to this episode to learn more or read this guide by Tangible. ✨ Leave a review and share the episode if this conversation challenged the way you think about growth, innovation, and sustainability. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit newwavenewsletter.substack.com

Subscribe to the newsletter:New Wave | Hugo Rauch | Substack****Brought to you by:EDF: partnering with New Wave on this mini-series to explore how cleaner energy, industrial innovation, and ambitious startups can rebuild Europe’s productive edge. Discover EDF’s work with industrial and climate innovators here.****👉 Europe cannot rebuild the pastReindustrialisation does not mean bringing back the factories Europe lost in the 1980s and 1990s. With high energy prices, material dependencies, labour shortages, and fragile supply chains, Europe needs a fundamentally different model: cleaner, more automated, less resource-intensive, and more flexible.👉 Startups don’t need more pilots. They need venture customersA startup cannot rebuild European industry alone. Neither can a corporate or a VC. The real unlock could be a three-way alliance: startups create the technology, investors finance the risk, and venture customers provide credibility, industrial access, and a path to scale.But are corporates prepared to make bold commitments, or will startups remain trapped in endless €10K pilot projects?👉 Europe has a speed problemEuropean founders are asked for three years of factory data before building their first factory. American investors ask whether the same technology could work in space.Europe has grants, engineering talent, and political ambition. What it lacks is faster capital, simpler programmes, unified rules, and a greater willingness to back step changes rather than incremental improvements.The cost of moving too slowly? Europe’s most ambitious companies, and their factories, may be financed and built elsewhere.****ReferencesEDF Pulse Pilot and industrial demonstration programmesSPRIND innovation programmesEuropean Innovation Council funding programmes Europe’s net-zero manufacturing capacity objectives****Wave MakersDr. Anne Umbach — HTGFMichel Hunsicker — EDF Pulse VenturesTom Vroemen — TETMET****Chapters(00:00) Can startups help Europe reindustrialise?(01:05) What reindustrialisation actually means(03:20) The factory of the future(09:15) Does Europe need to own its industrial infrastructure?(12:30) The role startups should play(15:40) What makes an industrial startup VC-backable?(21:35) Europe’s capital gap—and the American comparison(26:30) Venture customers as the missing unlock(31:35) How EDF helps startups cross the industrialisation gap(34:25) Grants, bureaucracy, and Europe’s fragmented programmes(37:10) Bold bets versus techno-economic reality(41:20) Will customers pay a European premium?(43:35) Is Europe on track for 2030?(48:20) One wish to accelerate European industry This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit newwavenewsletter.substack.com