The Adapt  proposes a risk-first, technology-driven framework for identifying genuine opportunities within the adaptation sector. Rather than focusing on the trillion-dollar "adaptation gap," investors should target innovative technologies that transform how adaptation happens—including both Industry 4.0 solutions and physical/material innovations that create asymmetric impact with large scale returns.

Climate tech's linguistic confusion is hindering investment clarity

In almost all climate circles, the terms "adaptation" and "resilience" are often used interchangeably, creating confusion for investors, founders, advocators and policymakers, although this article will focus predominantly on the first two. This conceptual murkiness has real consequences that cascade downstream: blurring market categories, complicating investment theses, and obscuring progress metrics.

There is significant opportunity, then, for those who want to address this “how”. The market for solutions is substantial, often referred to as the "adaptation funding gap" — a massive investment need estimated at US$194-366 billion per year, from the 2023 Adaptation Gap Report.

However, this gap is frequently presented as a straightforward investment opportunity without addressing the fundamental challenge: how can investors and venture specifically, generate returns in a space dominated by long timelines, supposedly "public infrastructure" and funding, and murky exit pathways?

At The Adapt, we propose a clear framework and a tech-first approach:

The framework is as follows:

This simplified view illustrates the core principle, effective climate adaptation requires a systems-level approach that recognises the interconnected nature of climate risks, technological interventions, and resilient outcomes.

The most successful adaptation technologies will address multiple risk factors while integrating with existing infrastructure and business models to create scalable, market-driven solutions.

Why This Distinction Matters

The climate tech ecosystem has matured enough to demand precision. When we conflate adaptation and resilience, we:

• Make it harder to measure success

• Complicate investment decisions

• Obscure market opportunities

• Ultimately make it harder for amazing founders to get the capital they need to scale

Adaptation: The Actionable Process

Adaptation represents specific technologies, systems, and approaches that respond to climate impacts. Adaptation is:

• Measurable: Solutions with quantifiable impact metrics

• Implementable: Technologies that can be deployed today

• Investable: Products with clear ROI metrics and business models

• Scalable: Solutions that can grow globally across markets

Some of the most promising adaptation technologies leverage cutting-edge innovation—ranging from advanced materials science to AI/ML, IoT, robotics, and data analytics—to create novel approaches to climate risk management that traditional infrastructure alone cannot match.

Examples across our risk vertical framing:

• Heat: Urban cooling systems like Zauben's green roofs that can reduce surface temperatures by up to 17°C compared to ground level greenery, using advanced IoT monitoring and automated irrigation systems.
  

• Water Quantity and Quality: Upstream Tech's HydroForecast platform combines satellite imagery with AI to provide accurate streamflow predictions for water and power utilities, enabling better management of water resources during both drought and flood conditions.
  

• Wildfire: Early detection systems using AI like Pano leverage computer vision to identify smoke columns hours before traditional methods, or Rain's autonomous helicopters that can quickly contain small wildfires through precision water application.
  

• Extreme Wind: Tomorrow.io's resilience platform combines hyperlocal observations and proprietary models to help organisations monitor, predict, and respond to escalating threats worldwide, especially extreme storms, cyclones, tornados and hurricanes.
  

• Pests & Invasive Species: FarmSense helps farmers with real-time identification of invasive insects like the Japanese Beetle using digital acoustic monitoring and deep learning algorithms. This enables a more data-driven approach to critical decisions like pesticide use and results in increased crop yields.
  

You'll notice that a couple of these solutions would normally be considered in the realm of another tech investment opportunity. Zauben and urban cooling systems are normally classed as built environment tech, while with the last risk, FarmSense could be categorised as AgTech rather than 'CAT'.

This is indeed a CAT solution as it is a direct solution to a climate-induced risk. As one article put on the risk posed by the Japanese Beetle:

There are hundreds of examples of companies like these that from a tech perspective, either produce high-quality data through drones, satellites, IoT sensors, or consume data through AI analytics, digital twins, and predictive modelling. Other examples in just the wildfire sector alone include BurnBot, Gridware and Overstory.

Resilience: The Systemic Outcome

Resilience is the resulting property of systems after adaptation interventions. Resilience is:

• Holistic: Spanning multiple systems and threats

• Emergent: Arising from combinations of adaptations

• State-based: Describing system capabilities rather than specific actions

"Resilience Technology" Doesn't Exist—And That's OK

When someone refers to "resilience technology," they're actually describing adaptation technologies that enhance resilience. This isn't semantics—it's about strategic clarity.

Looking at our risk verticals:

• For Heat Risk: A city deploying multiple adaptation technologies (AI-optimized cooling networks, IoT-enabled reflective surfaces, smart building management systems, and thermal imaging analytics) achieves heat resilience—the ability to function during extreme heat events with minimal disruption.
  

• For Water Challenges: A region implementing machine learning-based leak prediction, sensor-driven precision irrigation, automated water recycling systems, and digital twin watershed modelling develops water resilience—maintaining water security despite drought conditions.
  

• For Wildfire: Communities using computer vision early detection platforms, satellite-based vegetation monitoring, drone-deployed fire suppressants, and predictive evacuation algorithms create wildfire resilience—reducing loss and speeding recovery from fire events.
  

• For Extreme Wind: Towns and cities with autonomous microgrid systems, composite material building reinforcements, predictive storm tracking platforms, and robotic power line inspection tools develop storm resilience—maintaining critical functions during and after hurricanes.
  

• For Invasive Species: Ecosystems and agricultural lands protected by eDNA monitoring networks, drone-based detection systems, precision biocontrol deployment, and ML-driven spread prediction models maintain ecological and farming resilience—preserving biodiversity and ensuring stable crop outputs despite increased pest pressure and changing invasion patterns.
  

In each case, specific adaptation technologies (the process) contribute to system-level resilience (the outcome).

Natural Solutions vs Climate Adaptation Technology

It is easy to be critical of this approach as tech-oriented and not paying enough attention to natural adaptation solutions, a totally fair criticism. Nature-based solutions like mangrove restoration for coastal protection, urban forests for heat mitigation, and watershed conservation for flood management are vital tools for addressing climate risks. They provide multiple ecosystem services beyond climate adaptation and often cost less than engineered alternatives.

However, while these nature-based approaches are crucial, I wouldn't classify them as Climate Adaptation Technology (CAT) in the investment and founding context. CAT encompasses a wide range of technological solutions—both digital and physical—that address climate risks. While many of the most compelling investment opportunities leverage Industry 4.0 technologies (AI, IoT, etc.), others focus on physical systems and material innovations.

The CAT landscape includes several technological approaches:

• Advanced Materials Science: Climate-resilient building materials like self-healing concrete, ultra-reflective coatings, and fire-resistant composites; desalination membranes for reverse osmosis that don't rely on digital components

• Specialised Biotechnology: Drought-resistant crop varieties, salt-tolerant plants, and bioengineered microbes for soil resilience that represent technological innovation outside the digital realm

• Green Chemistry: Novel water treatment materials, sustainable cooling fluids, and eco-friendly fire retardants that incorporate scientific advancement without necessarily requiring connectivity

• Mechanical Engineering Innovations: Passive cooling systems, water-efficient irrigation mechanics, and modular flood protection that rely more on clever design than data processing

These technologies represent venture-backable opportunities with defensible IP, scalable business models, and clear climate adaptation benefits, whether they incorporate digital connectivity or not. While Industry 4.0 technologies often offer the most compelling investment opportunities due to their scalability and data advantages, the entire CAT landscape includes physical/material solutions addressing climate risks directly.

As Mazarine Climate, a water risk dedicated fund and only one of the two dedicated CAT venture funds (incidentally both focus on Industry 4.0 tools), puts it, they back founders who:

Nature-based solutions and continuing to restore them will continue to play a vital role in fighting climate-induced risk, but they are not 'technological' solutions in the sense of Industry 4.0 and others. Indeed, it is maybe doing the complexities of our planet an injustice to compare man-made technological feats with the intricacies of the natural world. The two solutions must inevitably work in symbiosis with each other, but shouldn't be confused for the same thing.

From Risk to Opportunity: A Technology-First Approach to the Adaptation Gap

The widely cited "adaptation funding gap"—estimated at US$194-366 billion per year, from the 2023 Adaptation Gap Report—is often presented as a straightforward investment opportunity. But this framing overlooks a critical question: How can venture investors generate returns in a space dominated by public infrastructure and uncertain commercialization pathways?

A sea wall might effectively protect coastal communities, but as an investor, where's the scalable business model and return opportunity? Traditional adaptation infrastructure requires immense capital, faces long regulatory timelines, and typically relies on public funding. Even institutional infrastructure investors, who might theoretically invest in such projects, typically don't because there's no clear payback mechanism—making them unsuitable not just for venture capital but for most private investment models.

The venture opportunity in adaptation isn't in funding the gap directly, it's in backing the technologies that can transform how adaptation happens. For venture investors seeking returns in climate adaptation, the process should follow these steps:

1. Identify Specific Climate Risks: Start by quantifying the economic impact of climate threats across sectors and geographies
   

2. Assess Where Current Solutions Fall Short: Evaluate traditional approaches and identify their limitations in terms of cost, scalability, or effectiveness
   

3. Find Technology Leverage Points: Pinpoint where innovative technologies—whether digital, material, or hybrid—can create asymmetric impact and advantages over conventional solutions
   

4. Target Capital-Efficient Models: Prioritize business models that scale without linear infrastructure costs and have clear paths to commercialization
   

5. Focus on Novel IP and Defensible Margins: Invest in proprietary approaches that create sustainable competitive advantages and attractive acquisition targets
   

This risk-first, technology-focused methodology reveals where genuine venture opportunities exist amid the broader adaptation landscape and the precise sweet spot where technological innovation meets critical climate needs with scalable business models.

Hidden in Plain Sight: The Overlooked Adaptation Tech Landscape

One of the most compelling venture opportunities in climate adaptation exists in companies that don't self-identify as "climate tech" but are addressing critical adaptation challenges within their own vertical with innovative technologies. These overlooked opportunities often operate in established commercial markets without the climate tech label—meaning they haven't yet appeared on most climate VCs' radars.

Consider these examples across various risk verticals:

In Controlled Environment Agriculture (CEA), companies developing vertical farming technologies for premium produce are simultaneously creating climate adaptation solutions. These systems can maintain consistent food production regardless of external climate conditions—addressing both heat and water stress while operating on commercial business models with proven customer demand.

In Water Management, Upstream Tech's HydroForecast platform combines satellite imagery, weather data, and machine learning to optimise water resource management across the water-energy nexus. While marketed primarily as an operational efficiency tool for utilities and hydropower operators, it's a powerful adaptation technology helping water managers navigate increasingly volatile precipitation patterns and changing water availability.

In the Invasive Species space, companies like Aqualitas and Pisces Molecular deploy eDNA technologies to detect invasive aquatic species far earlier than traditional methods.Though primarily selling to natural resource departments today, their proprietary detection technologies have emerging applications in agricultural biosecurity and water quality monitoring—representing an expanded market opportunity beyond their current positioning.

These examples highlight a key insight: by focusing on specific technological approaches to climate risks rather than climate-centric messaging, investors can identify adaptation technologies with proven commercial models that may be overlooked by traditional climate-focused capital.

Measurability: Adaptation's Advantage

For founders and investors, adaptation's concreteness provides crucial advantages:

• Adaptation technologies have clearer unit economics

• Adaptation solutions can be benchmarked against specific threats

• Adaptation companies can demonstrate clearer impact metrics

Conclusion: Finding True Investment Opportunities in Adaptation

The multi-trillion dollar climate induced risk market represents one of this decade's most significant investment challenges. But for investors, focusing solely on "the adaptation gap" misses the mark. The opportunity lies not in directly funding adaptation infrastructure—it's in backing the transformative technologies that fundamentally reinvent how adaptation happens.

By reframing our understanding—adaptation as the process, resilience as the outcome—we create a powerful process for identifying investable opportunities. This distinction isn't merely semantic; it's a strategic imperative that separates venture-scale opportunities from capital-intensive infrastructure plays and public funding. In other words Investing vs Funding.

The most compelling investment targets often exist at the periphery of traditional climate tech categories:

• Technology-first companies applying both Industry 4.0 tools and physical/material innovations to climate risks

• Commercial solutions with proven business models addressing adaptation challenges without explicit climate branding

• Risk-focused innovations that quantify and address specific climate impacts with proprietary approaches

• Capital-efficient models that scale globally without linear infrastructure costs

For founders building in this space, the message is clear: articulate your value in terms of specific risks addressed and outcomes delivered, build defensible technology moats, and demonstrate clear unit economics. For investors, look beyond self-identified "climate companies" to find adaptation technologies hiding in plain sight across diverse sectors.

The winners in climate adaptation technology won't be those building slightly better seawalls, instead we must look to the companies leveraging breakthrough technologies to deliver exponentially better solutions to specific climate challenges—offering great returns for growth and infrastructure players as well as venture in the process.

As climate induced risks and consequences continue to accelerate globally, the market for these solutions will only grow. The time for CAT investment is now.