The next wave of Kiwi innovators rises on the back of global momentum

A new report reveals New Zealand’s climate-tech sector is brimming with promise but battling a lack of funding, policy support, and scale-up infrastructure – putting the country at risk of missing the global green-tech wave.

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 start-ups 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 percent 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 percent of Kiwi sustainability entrepreneurs find it hard to access funding, with over half saying it’s “extremely difficult.” Only 10 percent described the policy environment as supportive, and nearly half of the surveyed businesses are operating at a loss.

And still, optimism persists: 65 percent believe their business will grow, and over 90 percent 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 start-up 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.