Green-tech investment continues to surge, topping US$2 trillion in renewables and US$70 billion in private climate‑tech funding. The transition from the extractive, fossil-fuel economy to a regenerative, low-emissions economy is one of the slowest but surest revolutions.
And New Zealand’s joining the fun. Our own sustainable innovation sector is beginning to bloom with the growth of solar, wind, clean tech and climate tech companies and VC funds.
But despite its promise, a new report warns that these green shoots risk withering under severe capital and policy constraints.
The Next Wave report from the Sustainable Business Network (SBN) and the University of Canterbury (UC) paints a vivid picture of Aotearoa’s sustainability sector: bold, fast-growing, and brimming with purpose but hamstrung by structural barriers that threaten progress.
The report draws on insights from 44 finalists in the 2024 Sustainable Business Awards, spotlighting an ecosystem of startups and small enterprises taking on some of the world’s most pressing problems, from decarbonising transport to building circular economies and engineering alternative proteins.
“These are the businesses solving the biggest challenges of our time: climate change, resource depletion, social inequality,” says James Griffin, SBN general manager. “But our investment and policy systems aren’t set up to support them. That’s a failure we can’t afford.”
Internationally, climate-tech is riding a strong tailwind. Clean energy investment grew by 12% in 2024, and sectors like energy storage, sustainable fuels, water conservation, pollution management nature-based services are seeing a resurgence of VC and private equity interest. After a funding dip in 2023, early 2025 indicators show a rebound in venture activity, especially in the U.S., China, Australia and Canada.
Yet New Zealand’s innovators aren’t seeing the same lift. The Next Wave report reveals that 75% of Kiwi sustainability entrepreneurs find it hard to access funding, with over half saying it’s “extremely difficult.” Only 10% described the policy environment as supportive, and nearly half of the surveyed businesses are operating at a loss.
And still, optimism persists: 65% believe their business will grow, and over 90% report rising customer demand.
“These founders aren’t just launching products, they’re reshaping systems,” says Dr. Kate Prendergast, co-author and UC researcher. “Our graduates are ready. But without the right infrastructure and policy settings, that momentum risks stalling.”
Among those feeling the pinch is Cetogenix, a clean-tech startup converting organic waste into renewable energy. CEO Trevor Stuthridge says deep-tech ventures like his face outsized challenges.
“New Zealand has no shortage of talent or innovation,” he says. “But we lack capital systems willing to back ambitious science-based ventures. We talk a big game on sustainability, but we’re trailing global peers when it comes to actual investment.”
His sentiment is echoed across the sector. The report identifies key barriers including:
- Lack of values-aligned capital at scale
- Weak sustainable procurement frameworks
- Policy uncertainty
- Low public awareness
- Limited support for scaling
- Poor cross-sector collaboration
Despite these constraints, the report positions New Zealand’s sustainable innovation sector as part of a global groundswell of entrepreneurial action.
Companies like EV Maritime (electric ferries), Daisy Lab (precision fermentation), Cleanery (eco-cleaning products), and Basis (smart metering) are already proving what’s possible, with global relevance.
The challenge now is to match their ambition with the investment, policy clarity, and systemic support needed to turn potential into performance.
“If we want to be climate leaders, not laggards, we need to act like it,” says Griffin. “This is the next wave. We can ride it, or risk missing it altogether.”