Houston Ranks Among Top Cities for Sustainability Startup Funding

Houston is once again proving it’s a city where green businesses can thrive. A recent report found Houston ranks fourth in the nation for average funding raised by startups focused on sustainability.

PromoLeaf’s analysis of Crunchbase data found Houston startups leading the way in sectors such as renewable energy, decarbonization and environmental engineering raked in $150.7 million in funding. Salt Lake City ranked first with $204.6 million, followed by Santa Monica, Calif. with $154.3 million and Freemont, Calif. with $153.5 million.

Companies like Ionada and Renewell Energy are choosing Houston to scale their businesses because of the region’s expertise and global network as the Energy Capital of the World.

Momentum continues to build in Houston as the region positions itself as a global leader in the energy transition. According to the Partnership’s Houston Tech Report, startups in the energy industry received more than $320 million in venture capital funding between 2017 and  2021.

In October, the Houston Energy Transition Initiative (HETI), a strategic initiative led by the Partnership and dedicated to strengthening Houston’s leadership as the Energy Capital of the World, released a report examining the region’s opportunity to fund the energy transition and the success companies across all energy value chains can find in Houston.

Another report recently highlighted how local companies continue increasing their investments in clean energy. Axios Houston reports Houston companies invested more than $1.25 billion in clean technology, climatetech and impact investment in 2022, making the city one of the top five cities in the U.S. for investment in companies focused on environmental, social and governance (ESG) initiatives.

“I think what we’re gonna see is a new breed of public companies created within Houston that will go public in 2023 and 2024 that’s going to further make Houston more diverse and increase the level of energy transition that we’re already seeing in the Houston market,” Will Braeutigam, U.S. capital markets transactions leader at Deloitte, told Axios Houston.