Today, many companies working on climate tech face a catch-22: They can’t attract enough customers to sustainable products because they cost more than environmentally damaging options. But these products—like direct air capture and sustainable aviation fuel—won’t become less expensive unless more people opt to pay the higher price right now.

Bill Gates calls that additional cost the “green premium.” In January, his climate investment fund, Breakthrough Energy, created a private-public program aimed at bridging the affordability gap by combining philanthropic donations, traditional investors, and product offtake agreements—a type of long-term contract for large product purchases.

• The program, named Breakthrough Energy Catalyst, has raised $1.5 billion to fund companies in four areas of emerging climate tech—direct air capture, green hydrogen, long-duration storage, and sustainable aviation fuel.

“There are alternatives for every one of those products that are incredibly cheap, easy to finance, and there's a market for them,” Catalyst’s managing director Jonah Goldman told Emerging Tech Brew. “What we need right now is the phase of commercialization where you have to basically take a capital risk, because you’re building something new.”

By the numbers: Goldman hopes that Catalyst’s funds will make up about 10% of the total financing for these ambitious and expensive projects, accounting for the last-mile investment while the rest is financed traditionally.

• Based on this estimate, he says the Catalyst dollars could help mitigate the risk for other investors and mobilize up to $15 billion of total capital when combined with funding from sources like private investors and government grants.
• Catalyst aims to raise an additional $1.5 billion by the middle of 2023.

“All of our money is concessional capital,” he said, referring to investments that generate below-market financial returns. “We think that there has to be that level of concession in order to effectively mobilize the rest of that [financing].”

Big picture: For these new financing models to work, there will need to be government support as well, Goldman said.

But given that the government is unlikely to fund or facilitate every single climate solution at the pace needed, Catalyst is ultimately trying to step in and bridge the gap between the forces of capitalism and the urgency of the climate crisis.

“Clean cement doesn't build a building better than dirty cement,” Goldman said. “Capitalism normally only transitions when things are either better or cheaper. And right now, in some things, we’re actually trying to transition to things that are less effective and more expensive. And there’s just no natural mechanism to do that in a capitalist environment.”

Click here to read the full story.—GD

For the first time, formerly-Facebook-now-Meta broke out the financials of Reality Labs, its AR/VR—metaverse, if you please—division.

It ain’t pretty…But 1) no one expected it to be and 2) with ~$57 billion in annual profit from its “family of apps” alone, Meta can afford some financial ugliness.

• Reality Labs generated ~$2.3 billion in revenue last year, double the ~$1.1 billion it made in 2020. The jump is mostly because it sold more of its Oculus VR headsets.
• But it spent ~$12.5 billion in 2021, and ~$7.8 billion in 2020.
• In sum: Reality Labs lost $10.2 billion last year, and $6.6 billion in 2020.

These losses are primarily driven by Reality Labs’s adding a ton of staff—it had nearly 10,000 employees in the division as of last March, and has announced plans to hire another 10,000 to work on metaverse projects in the EU.

• Employees across the company are reportedly being encouraged to apply for open gigs at Reality Labs, if they want to build a career at Meta. Not all of them are pleased about this, according to the New York Times.

Looking ahead…Facebook wrote that it expects to further increase its investment in Reality Labs in “future periods.” In other words: It will spend at least another $10 billion on the metaverse this year.

Click here to read this story on-site.—DM

Coworking is a weekly segment where we spotlight Emerging Tech Brew readers who work with emerging technologies. Click here if you’d like a chance to be featured.

How would you describe your job to someone who doesn’t work in tech?

I use established and emerging technologies to create resources and visualizations to aid in teaching and research for art history, archaeology, and related disciplines.

What’s your favorite emerging tech project you’ve worked on?

Drawing on original photographic fieldwork, I developed VR tours of cultural heritage sites which are controlled by instructors and served synchronously to headsets worn by students. In the past few years, we’ve been able to give hundreds of students their first VR experiences within an art history course.

What’s the best piece of tech-related media you’ve read/watched/listened to?

There’s an old video of John Carmack at Oculus Connect 2 where he’s live coding on a headset. It’s dazzling to see someone who can move between hardware and software with such deep understanding.

Click here to read this story on-site.—DM

Stat: Amazon’s 2021 capital expenditures totaled $61 billion, more than that of North American telcos’ combined in 2020, and slightly less than North American utilities combined in 2020.

Quote: “With our renewed Algorithmic Accountability Act, large companies will no longer be able to turn a blind eye towards the deleterious impact of their automated systems, intended or not. We must ensure that our 21st-century technologies become tools of empowerment, rather than marginalization and seclusion.”—Representative Yvette Clarke, sponsor of the reintroduced Algorithmic Accountability Act

Read: Vertical farming is growing like a weed.

Somehow, we manage: Even when it’s figuring out how to manage a displaced workforce in a pandemic. To see what’s been working, workplace-management platform Robin talked to hundreds of managers, VPs, and execs about how they’ve adapted and how the employee experience can improve going forward. Get Robin’s 2021 Workplace Landscape Report here.*

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Tuesday: GlobalFoundries reports earnings. We’re watching for the obvious reason—an update on the chip shortage.

Wednesday: Samsung’s first 2022 Unpacked event takes place. Let’s hope they actually show up to this event…

Thursday: The US releases CPI data for January. In December, inflation rose at its fastest rate since 1982.

Ark Invest recently released its Big Ideas 2022 report, and it’s a 132-page doozy. We won’t try to summarize all of that here, but instead provide a brief orientation:

• The report covers everything from Web3 to gene-editing to electric vehicles to 3D-printing.
• It provides market forecasts across all of these spaces, and it is—spoiler alert—quite bullish on all of them.

Overall…Ark forecasts that the total enterprise value of “disruptive innovation technologies” will rise from $14 trillion in 2020 to $210 trillion in 2030.

Catch up on the top Emerging Tech Brew stories from the past few editions:

• The rise of digital health in five charts
• ‘Hey Alexa’ no more? A new feature deemphasizes Alexa’s ‘wake word’
• 5G still needs its ‘killer app’