There is never a bad time to invest in sustainability, according to HRH Prince Khaled bin Alwaleed bin Talal Al Saud, founder and CEO of KBW Ventures.
“Even though there are headwinds right now when it comes to the rising cost of food and energy, governments [still] need to earmark a large amount of capital just to invest into these sustainable technologies because there is no wrong time.
Discussing the current landscape’s opportunities and challenges for investors, Prince Khaled emphasised the importance of avoiding confinement to specific sectors. “We remain sector-agnostic. Food tech, especially concerning climate change, has been overlooked. For our region, addressing food sustainability is inseparable from food security,” he highlighted.
Reflecting on the region’s response to pandemic-related challenges, he remarked, “During the pandemic, this region did dodge a bullet when it comes to food sustainability and security.”
Bridging to financial viability
Prince Khaled suggested many ways to mitigate the headwinds regarding startup investments and navigate towards commercial markets during inflation and higher interest rates, particularly in renewable and low-carbon projects with high capital expenditure and low operational costs.
“I think putting a lot of blame or responsibility on consumers is very unfair,” he said. “I think corporations and governments need to lead the way.”
“The capital of the world when it comes to leading the way for climate for mitigating climate change, as the Middle East is Riyadh and Abu Dhabi, there’s no doubt about it. So, mitigating that response to this responsibility of the consumer and placing it on governments and placing it and placing it on corporations is the right approach.”
According to the CEO of KBW Ventures, there are several ways that we have to mitigate climate change. One way is creating funds like a Breakthrough Energy Venture (BEV). “I think Breakthrough Energy Ventures is one of the leading organisations that can help make these big claims,” he said.
BEV is an investment firm seeking to finance, launch, and scale companies that will eliminate greenhouse gas emissions throughout the global economy. Part of Breakthrough Energy’s network of investment vehicles, BEV has raised more than $2 billion in committed capital to support more than 100 cutting-edge companies.
“More importantly, one organisation is not going to make a difference,” Prince Khaled stressed. “We have to have a collective effort with many organisations working on moonshot ideas, at the end of the day, as much as I believe in climate change.”
Small Modular Reactors
When queried about his stance on hydrogen, Prince Khaled said, “We look at the landscape as an entirety, so we don’t look at one in green hydrogen or other types of green energy”.
He emphasised that he was highly bullish on nuclear energy, especially in the new nuclear and small modular reactors (SMRs) era. “Small Modular Reactors are important to us,” he said. “We have several networks of investors and entrepreneurs that we tap into and talk to regularly, especially when it comes to these types of reactors.”
“And we’re extremely bullish on that regard. We’ve seen the UAE jump-started when it comes to their nuclear program, and we would love to see a lot more happening.”
Investment in the future
Discussing the conventional challenges sovereign wealth funds face when investing for the future, Prince Khaled said the region has been monumental and a poster child for the world in extracting wealth from fossil fuels.
“What are they using? It is the question, and we are using it in the right direction,” he said. “I think sovereign wealth funds, by definition, have the responsibility to their people for investing into these sectors, but creating smaller funds rather than the giant larger funds.”
“Because at the end of the day, innovation is going to drive change, and innovation is not going to drive change with companies capitalised at a billion dollars. They are going to be the young entrepreneurs who are starting their businesses in their backyard.”
Regarding cheque sizes, Prince Khaled said that sovereign wealth funds will have little impact. The venture capital companies will make the most significant impact, with the sovereign wealth funds following their lead.
