The cleantech companies that didn’t make it through 2024

Most startups fail.

That’s the bitter truth awaiting hundreds of companies founded in the recent wave of energy and climate entrepreneurship.

Success for a venture-capital-funded startup means an exit through a profitable acquisition or a public listing, but those wins have been few and far between for cleantech. And even the mature companies and industry icons that have managed to graduate from startup life can eventually stumble and fall.

Amid high interest rates, frozen M&A markets, and a serious slowdown in public offerings, the opportunity for financial success has shrunk for startups. These factors also make it harder to raise new venture capital; funding for climatetech startups dropped by 20 percent in the first half of 2024.

But even if better exit opportunities emerge and the venture dollars start flowing again, it won’t change that fundamental truth: Most startups fail. It’s the reality of the game; commercializing important new climate solutions requires lots of shots on goal.

The redeeming aspect of failure is that it occasionally produces lessons, whether a company runs out of cash, customers, time, or ideas. Here are some of the climatetech companies that went belly-up in 2024 — and what can be learned from their sagas.

Solar sunsets

Arguably the most shocking cleantech corporate demise of 2024 was that of SunPower, a solar industry icon that grew from humble startup roots to a valuation in the billions, only to file for bankruptcy in August. Even as solar installations smash records in the U.S. and the federal government channels capital into onshoring solar panel production, SunPower found itself undone by China’s industrial policy might and its own boardroom missteps. High interest rates and other policy headwinds, like California’s NEM 3.0, didn’t help.

Lesson: The tale of SunPower’s fall is too long and nuanced for a neat takeaway. But here’s an observation: China’s incremental technical progress in silicon solar cell efficiency eroded SunPower’s competitive edge, leaving it to fight on price against Chinese firms. That’s a losing battle even with government help. Also, tariffs don’t work.

Over 13 years, Ubiquitous Energy raised more than $70 million in funding from venture and corporate investors to develop a transparent window coated with an energy-generating photovoltaic layer. The startup sent its employees home in April.

Lesson: Building-integrated solar windows is one part technical challenge and nine parts convincing electricians, architects, and builders to accept the products — a more difficult task than turning window panes into solar panels.

Ohio-based Toledo Solar wanted to compete with thin-film solar panel leader First Solar so desperately that it (allegedly) sold Malaysian-made First Solar modules under its own name, claiming they were made in America. The company ceased operations, such as they were, in July.

Lesson: Toledo, Ohio, deserved better.

Solar installer bloodbath

High interest rates and rooftop solar incentive shifts in leading states rippled through the long tail of residential solar installers and led to scores of bankruptcies in the past two years, an unprecedented collapse.

Here are a few of the larger casualties from this year: Sunworks, a residential and commercial solar installer, filed for bankruptcy in February. Founded in 2002, Sunworks had developed 224 megawatts of solar projects across 15 states and employed 640 people. Titan Solar operated in 16 states and abruptly shut down its operations in June. Utah-based residential solar company Lumio filed for bankruptcy in September.

Lesson: Clean energy startups are sensitive to interest rate increases and policy changes — and politicians are eroding rooftop solar incentives following years of utility lobbying, all at a time when rates are sky-high.

Energy storage setbacks 

Armed with billions in investor capital, scores of storage startups have been aiming to dethrone energy stalwarts like lithium-ion and diesel generators — but in the words of The Wire’s Omar Little, ​“If you come at the king, you best not miss.”

These companies missed.

Sweden’s Northvolt, once valued by investors at almost $12 billion, filed for bankruptcy in November in the year’s biggest battery bust.

Founded in 2015 by two former Tesla engineers as Europe’s great EV-battery hope, Northvolt had raised over $6 billion from investors including Goldman Sachs, Baillie Gifford, IKEA, Siemens, Baron Funds, AP-fonden, BMW, and Volkswagen — in addition to raising billions of dollars in debt. Earlier this year, Northvolt shut down its lithium metal division, laying off almost 200 people at what had been Cuberg, a startup it acquired in 2021.

Northvolt is now restructuring, selling off equipment, wiping out its existing investors, and chasing new funding.

Lesson: European firms cannot compete with Chinese ones on low-margin, capital-intensive lithium-ion batteries while also earning capital returns and complying with regional environmental regulations and labor laws.

Ambri, an energy storage aspirant with technology based on the research of MIT professor Donald Sadoway, declared bankruptcy in May. The long-in-the-tooth startup had raised more than $200 million for its calcium and antimony electrode-based battery cells from investors including Bill Gates, Paulson & Co., Khosla Ventures, and French energy giant TotalEnergies. In August, Gates and other investors purchased the company’s assets at auction.

Lesson: A Bill Gates venture investment is the kiss of death for energy storage startups.

Richmond, California–based Moxion Power laid off 101 workers in June and shuttered its doors, following a wave of hype for its 75-kilowatt portable lithium-ion batteries that it hoped would replace diesel generators. The company attracted more than $110 million in funding from investors including Tamarack Global, Amazon, Microsoft, and Energy Impact Partners.

Lesson: Lithium-ion batteries continue to plunge down the cost curve, but they’re still not cheap enough to compete against generators powered by fossil fuel. Check your local movie set, construction site, or food truck’s current source of power for evidence.

In August, Swell Energy, a startup that aimed to aggregate networks of residential solar energy and battery installations into software-controlled ​“virtual power plants,” said it was shutting down its operations. The firm raised more than $150 million from investors including SoftBank, Greenbacker, and Ares Management. Swell’s collapse impacted a 1,200-person virtual power plant project on Oahu, Maui, and the island of Hawaii.

Lesson: Operational missteps aside, Swell faced a number of hard-to-overcome challenges — like being too early for an undeveloped and unloved virtual power plant market.

Two other notable failures in the storage sector:

Ionic Materials, a 40-person MIT spin-out developing battery materials, shut down in June, as reported in The Information. The company had raised more than $65 million from battery aspirants Renault, Nissan, and Mitsubishi. Australian flow battery firm Redflow ceased operations in August with its administrators unable to find a buyer for the startup, which was previously listed on Australia’s ASX exchange.

Removing carbon one VC dollar at a time 

Running Tide was the largest marine carbon-removal startup and the first to sell ocean carbon credits. Its initial plan of removing carbon dioxide from the atmosphere and sequestering it in the ocean by growing and sinking kelp morphed into sinking wood chips coated with lime-kiln dust. Despite the change in that concept of a plan, the company attracted carbon purchases from Stripe, the Chan Zuckerberg Initiative, and Microsoft.

Running Tide announced that it was folding in June after raising more than $54 million from Chris Sacca’s Lowercarbon Capital, Foobar, GreenPoint Partners, Grantham, Foundry Group, and Venrock.

Lesson: Res ipsa loquitur.

Unsustainable aviation

Chasing a clean fuels breakthrough, Fulcrum BioEnergy promised to transform municipal waste into sustainable aviation fuel through a low-emissions gasification process. Instead, the company incinerated hundreds of millions in funding from BP, United Airlines, Cathay Pacific, and Japan Airlines — and hundreds of millions more in municipal bonds. The firm ceased operations in May.

Universal Hydrogen hoped to develop hydrogen-powered flight but went bust in June, after burning through $100 million from a consortium of overoptimistic venture investors and corporates.

Lesson: Clean flight will always be one of the more challenging climatetech sectors.

Charger bankruptcy

Tritium, a major provider of high-speed EV chargers, went bust in April but found a buyer for its insolvent business in India-based Exicom, which claims it will keep Tritium’s U.S. factory in business. Tritium has sold roughly 13,000 chargers in 47 countries and claimed a 30 percent U.S. market share for direct-current fast chargers in 2023.

Lesson: Canary Media’s Jeff St. John tells the horror story of what happened when customers were abandoned by a different EV charging equipment maker, Enel X Way, showing the chaos that can ensue when a hardware firm struggles.

Food fights

Cultivated meat startup SCiFi Foods announced its closure in June, citing regulatory and technical headwinds.

Smallhold, an organic-mushroom grower with a vertical farming approach, filed for bankruptcy in February. Founded in 2017, the Brooklyn-based company operated indoor mushroom farms in New York City, Los Angeles, and Austin. Private equity firm Monomyth Group became the majority owner in February and restructured the company, closing the farms and transforming Smallhold into a mushroom distributor.

Bowery, the New York City–based, celebrity-funded vertical farming startup, is closing shop. Once valued at $2.3 billion, the firm had raised more than $700 million in venture capital.

Smallhold and Bowery join a number of recent indoor farming startup failures including robotics firm Iron Ox, vertical farmer AeroFarms, and greenhouse grower AppHarvest.

Lesson: Agriculture is hard, and tech-based agriculture is even harder. Despite the failures, food-tech startups such as the highly valued vertical farming outfits Plenty and Oishii continue to be funded and formed.

Zero to 60 and back to zero with EVs

Luxury EV maker Fisker went bankrupt again; electric-van maker Arrival went bankrupt and sold its assets to another struggling EV maker, Canoo, which is currently furloughing employees; Cake, a Swedish e-motorcycle startup, sold 6,000 bikes but filed for bankruptcy in February after raising more than $75 million.

Arcimoto, Faraday Future, Mullen Automotive, and Workhorse Group are publicly traded EV companies but are facing delisting warnings, paltry revenue, and valuations that are rapidly approaching zero. Nikola stock is down by 90 percent year to date.

Lesson: Scores of automotive companies were created and perished in the previous century’s transition to horseless carriages. The current creative destruction of EV companies is to be expected in a massive societal shift to electrified transport.