Chatting about the weather may be the most famous form of small talk. But don’t be fooled. No one thinks this is trivial.
In fact, we are all obsessed with the weather. And there are good reasons why strange weather events are becoming more and more regular in the age of climate change.
Search less. Close more.
Grow your bottom line with an all-in-one prospecting solution from the leader in private company data.
As Labor Day weekend approaches, a heat wave in the West is set to set new records, with temperatures forecast to peak around 125 degrees in Death Valley.
Meanwhile, elsewhere on Earth:
- A third of Pakistan was submerged last week by historic monsoon floods.
- Europe is facing its worst drought in 500 years as rivers dry up, crops wither and the risk of wildfires increases.
- China’s worst heatwave on record lasted for 70 days, causing drought and rolling blackouts in some large cities.
According to the Environmental Protection Agency, scientific research shows that extreme weather events such as heat waves and large storms are likely to become more frequent or more intense with climate change. It points to a future in which we all compulsively monitor weather forecasts, worrying whether we’re at greater risk of melting in the heat or being swept away by storm surges.
What does that have to do with startups?
We’ve talked a little bit about the weather, but you might be wondering: how does this all relate to startups, money, and the kinds of things Crunchbase News usually covers?
After all, weather is a rising theme among funded startups these days. A sampling of investments in this space found at least 23 of his companies with weather-focused business models that have raised money since last year.
Taken together, these companies listed below have raised approximately $880 million to date.
Our portfolio ranges from satellite network operators to reinsurance underwriting tools. However, most share a unifying theme, related to the idea that current weather and weather risk forecasting tools are woefully inadequate to meet the challenges ahead.
Most of the funded companies sell forecasting and analytics services to insurance companies and other industries dedicated to risk management. Given the complexity of climate and weather variables, it is often not something you can do in-house.
“Mathematical science is not the same as earth science,” said Caribou Honig, partner at SemperVirens Venture Capital, which focuses on the insurtech space. “Some types of risk analysis may be beyond the expertise of traditional insurers.”
Measure risk from the air and sea
In particular, insurers typically aren’t in the business of operating data collection technologies that make extensive use of satellite networks, unmanned aerial vehicles, and other infrastructure.
Such attempts are in the realm of startups. A case in point is Saildrone, one of his largest weather-related funding recipients. Saildrone is known for surface drones that track hurricanes. The Alameda, Calif.-based company has so far raised $190 million for maritime drones that provide data on climate, mapping and maritime security use cases.
Satellites are also a big area of startup investment. To date, he has raised more than $180 million for Tomorrow.io, which launches a constellation of weather satellites equipped with radar and microwave sounders. The Boston company was on the verge of going public via a SPAC before ending its plans as the market changed.
Meanwhile, Spire Global, the operator of a satellite network that provides climate and weather data, has actually pushed the button to go public. Shares of the San Francisco-based company, which went public through SPAC last year, are down more than 90% from its peak. Prior to going public, Spire raised over $165 million in venture capital.
In the private market, other weather-focused startups operating from the air are also raising money. This includes GeoOptics, which provides satellite data to the National Oceanic and Atmospheric Administration’s commercial weather data program. And Denver-based Urban Sky has raised seed funding to expand its remote-sensing “stratospheric microballoon.”
Bringing weather data back to Earth
Back on Earth, the startup is also scaling up a number of products aimed at understanding and making decisions about the ever-growing accumulation of environmental data.
Louisville, Kentucky-based Climavision raised $100 million last year for its proprietary weather data and forecasting tool. Its products combine space-generated data with a private network of high-definition radars to fill gaps in weather coverage.
In Silicon Valley, Jupiter Intelligence has raised $88 million in venture funding to date to provide weather and climate risk analytics to industries such as insurance, real estate and energy. Provides scores for a range of risks such as fire, flood, and wind.
On the consumer side, Santa Monica-based Sensible Weather offers a policy to reimburse people for travel and outdoor activities in the event of impending inclement weather. The three-year-old company raised his $12 million in Series A funding in May.
The insurance industry appears to be a particularly voracious consumer of upgraded climate and weather-related risk management technology. That’s mostly what you’d expect from chasing money.
Insured natural catastrophe losses have increased 360% over the past 30 years, according to a report by research firm Capgemini. A recent insurer survey found that about 40% rate climate change as a top priority.
But while the concerns may be more pressing today, they are certainly not new.
“Of course, the insurance industry has always recognized that weather-related risks are important to their business,” said Honig. “While catastrophic events such as hurricanes, floods and wildfires make the headlines, hailstorms and even days of freezing water pipes can add up to significant losses. “
Now that we’ve reached the end of a bitterly hot summer for many, frozen water pipes sound like a delicious icy treat. In a few months, it will have to contend with yet another seasonal problem.
If one lesson can be learned from the influx of weather-related startup money, it might be this: We cannot realistically expect Mother Nature to impede our own actions through entrepreneurial ingenuity. But on the bright side, weather startups appear to be making strides in making things more predictable.
Illustrated by Dom Guzman
Stay up to date on our latest funding rounds, acquisitions and more on the Crunchbase Daily.