HSBC to fund Google Cloud climate partners

HSBC and Google Cloud are partnering up to support companies offering sustainability solutions through the tech giant’s validation program, Google Cloud Ready Sustainability, the companies said today.

• The top line: Under the new partnership, HSBC’s climate tech finance team will advise GCR Sustainability companies on venture debt financing options. The bank will seek out financing opportunities and connect companies with its customer base.
• The market grounding: Global funding for climate tech companies saw a significant dip in 2023, dropping by 30% compared to 2022. However, large banks and other financial institutions are starting to take notice of the sector; non-equity financing is on the rise, with debt playing an increasingly large role in the energy transition’s capital stack as the market matures.
• The current take: "Partnerships and innovative financing solutions are key, especially during a period when investment in climate tech startups has fallen,” HSBC’s head of commercial banking sustainability Natalie Blyth said in a statement. “By combining financing support, cloud technologies and connectivity to partners across our combined footprints, we will help climate tech vendors accelerate their growth, and develop the solutions we urgently need at scale.”

Google Cloud launched its sustainability program just over a year ago, creating a suite of business-ready technologies aimed at helping companies measure and reduce emissions, build more sustainable supply chains, and identify climate risks. 

Many of the companies offering their solutions on the platform are in need of funding, a need that pairs well with HSBC’s recently-announced ambition to spend $1 billion on early-stage climate tech companies. (Incidentally, HSBC purchased the U.K. branch of failed tech startup backer Silicon Valley Bank, which was known for providing venture debt to climate tech companies.)

To kick off the partnership with Google Cloud, HSBC said it has offered a venture debt financing package to clean energy marketplace LevelTen Energy, which has so far facilitated more than $5 billion worth of transactions.