Investor Spotlight: Adapt [us] Capital - Finding Returns in a Warming World

"We've missed the plot with climate change" - says Darren Clifford, founder and managing director of Adapt [us] Capital, explaining why his new fund, announced just yesterday, looks beyond traditional climate tech to find opportunities.

Instead of chasing carbon credits or ESG mandates, he's betting on businesses that benefit from predictable demand in a 2.5°C+ world - companies solving urgent problems in heat management, water scarcity, and supply chain resilience that customers will pay for because they have to.

We sat down for a quick interview to explore his playbook for finding returns in climate adaptation tech.

Interview

Could you briefly introduce yourself and share your journey from McKinsey to launching an adaptation fund? What aspects of your background have been most valuable in this transition?

I spent over a decade at McKinsey, where I was one of the global leaders of our Green Business Building practice—helping corporates and startups launch and scale climate-related businesses. Alongside that, I’ve been an active angel investor for 20 years, drawn to early-stage ventures where I could be hands-on in shaping strategy and teams.

Over time, I began to reflect more deeply on the intersection of purpose, passion, and skills. My purpose is to be positively impactful with people. My passion is entrepreneurship. And my core skills lie in working with others and solving hard problems. When I asked myself how to bring those to life in a meaningful way, the answer was clear: build a VC fund and venture builder focused on climate adaptation.

I believe we are most likely heading toward a world that is 2.5°C or more warmer—and while I hope I’m wrong, we need to be prepared. That’s what Adapt [us] is about. We back businesses that will help people live well in a hotter, more volatile world—not through charity or compliance, but by serving growing, self-interested demand.

The transition from McKinsey to this has felt like a natural progression—combining my experience building companies, investing in founders, and thinking systemically about what it takes to thrive under new conditions.

Your fund will take an interesting approach by focusing on businesses that will benefit from predictable demand created by climate change rather than labelling yourself as a pure climate fund. What led you to this positioning strategy?

I think we’ve missed the plot with climate change. We’ve become so focused on net zero that we’ve stopped talking about what really matters—ensuring humanity gets to live a good quality of life in a hotter, more volatile world. Net zero is a huge part of that, but so is infrastructure, health care, economic stability, and social cohesion.

Mitigation efforts are critical and underfunded, but many of the business models are hard to scale. They depend on carbon pricing or ESG mandates and often don’t align with the day-to-day decisions people or businesses are making. That creates a disconnect between climate solutions and actual market demand.

We take a different approach. We’re a for-profit fund because we believe that’s what’s needed to scale solutions and have real impact. You can’t reach scale without creating value. So we invest in companies where global warming creates predictable, growing demand—products and services people will buy not out of obligation, but because they solve urgent, personal problems.

We only back companies that will have a positive impact on the quality of life of humanity. We believe in creating shared value—where the business case and the societal benefit are aligned. It’s how you optimise profits today, and it will matter even more as customer preferences and regulations evolve.

Most existing adaptation funds have specialised in particular climate risk niches. As a more generalised fund covering multiple adaptation areas, how do you ensure you have sufficient domain knowledge to evaluate and source the best deals?

We approach this differently. First, we believe that evaluating and coaching the founding team is more important than evaluating the business itself—especially at the earliest stages. That’s where our transferrable business knowledge comes in. We focus on whether the team has the resilience, clarity, and ability to execute in uncertain conditions.

Second, we use a thesis-driven and AI-supported approach to understand whether a startup is operating in a space with real, sustained tailwinds—typically looking for industries with 10%+ CAGR driven or accelerated by climate change. Our AI helps us map these shifts across sectors so we can spot opportunity even in unfamiliar terrain.

Third, our model is built to learn fast. We start with a small check—typically $50–100K—and immediately embed a team of business builders for a ~3-week strategy sprint. During that time, we speak directly with customers and domain experts to understand if this company can win in the market. If the signals are strong, we follow up quickly with a larger investment—$200–400K—and deliver deeper business-building support aligned to a focused scope.

We’ll never be the domain experts—but we make it a priority to listen closely to customers and those who are.

Many argue that adaptation investments face challenges with capturing financial returns despite clear economic benefits. How do you identify the 'low-hanging fruit' that can deliver venture-scale returns without requiring major policy shifts?

We see the climate change investing landscape as falling into three broad categories. First, there’s mitigation—focused on reducing or removing CO₂ emissions. Second, there’s traditional adaptation—centred on resilience and risk management, often requiring public funding or regulatory shifts.

But there’s a third bucket that doesn’t fit either label, and probably won’t be called “adaptation” at all. These are traditional industries—like water management, cooling, cold supply chains, temperature-regulating fabrics, or climate-aligned travel—that are experiencing growing demand because of a warming world. None of these sectors market themselves as “climate solutions,” but they are playing a critical role in helping people and systems adapt. That’s where we focus.

This category has a much easier path to delivering financial returns, because the business case is already aligned with customer needs. We look for situations where the economic buyer is purchasing for their own benefit—not because they should, but because it’s better, faster, or cheaper. That’s how you scale a company without waiting on policy.

If a business only works with a carbon tax or ESG scorecard, it probably isn’t for us. We’re looking for ventures that can scale on their own merits.

You mentioned using ML algorithms and Harmonic.ai for deal sourcing. How has this technological approach to identifying adaptation opportunities performed so far, and what advantages does it provide over traditional sourcing methods?

We believe building relationships is the new proprietary deal flow. In a world where privacy is shrinking and transparency is growing—on both sides of the table—it’s no longer enough to rely on who sends you a pitch deck or who you bump into at a conference. Everyone can see who is starting a company and who is writing checks. The old playbook of waiting for referrals doesn’t cut it anymore.

Instead, we start with a broad universe of startups—sourced through Harmonic and other data platforms—and apply our proprietary scoring algorithm to filter based on our thesis and investment criteria. We use machine learning to continuously improve that model, helping us identify external markers of fit: sector tailwinds, founder background, traction signals, and alignment with predictable climate-driven demand. This lets us be highly targeted and efficient in who we reach out to.

That outreach is a key difference—we don’t wait for inbound decks. We proactively connect with founders where we see potential alignment and shared ambition. It makes the conversation richer from the start and increases our chances of building real partnerships.

This approach also helps reduce bias. Instead of relying on network reach or pattern-matching based on who "looks like a founder," we’re creating a more systematic and thesis-led way of finding companies—often surfacing overlooked ideas and diverse founding teams solving real, gritty problems.

It’s still early, but the results have been clear: better deal flow, greater diversity, and access to companies others simply aren’t seeing. And because the system is structured and adaptive, it gets stronger with every cycle.

When evaluating potential investments, you're looking at existing strong CAGR that will accelerate under global warming. Could you share examples of sectors or business models where you're seeing this pattern most clearly?

We focus on sectors where climate change is driving predictable, long-term demand growth—and where companies can deliver better, faster, or cheaper solutions that meet that demand. These aren’t speculative markets—they’re already growing at 10%+ CAGR, and we expect that growth to accelerate as the world gets hotter and more volatile.

Here are five examples from our thesis:

• Cold Chain Logistics (CAGR 14.5%) – As food and pharmaceuticals face rising temperature volatility and global trade expands, cold chain logistics is set to grow from $368.1B in 2024 to $1.25T by 2033. Companies like SkyCell, which makes smart containers for pharma logistics, are already gaining traction.

• Sustainable Tourism (CAGR 13.5%) – The tourism industry is projected to grow from $4T in 2024 to $13T by 2033, with a rising premium on destinations and experiences that are resilient, climate-conscious, and socially meaningful. TravelPerk is one example of a platform adapting to this shift.

• Water Management (CAGR 12.5%) – Smart water systems are growing rapidly, with the sector expected to expand from $19B in 2024 to $61.7B by 2034. Gradiant, which focuses on industrial water recycling, achieved unicorn status in 2024.

• Temperate Glass (CAGR 10.9%) – Climate-resilient building materials like dynamic glazing are growing in adoption, with the market projected to reach $15.1B by 2030. Ubiquitous Energy is an example, offering transparent solar windows targeting real estate.

• Personal Cooling (CAGR 10.5%) – As heat becomes a major health issue, personal thermal management is set to grow from $14.2B in 2022 to $25.3B by 2030. Ōura’s smart rings are one example, already used by millions to track temperature and sleep under stress conditions.

These are not niche markets—they’re large, growing, and being reshaped by climate. Our job is to find the companies that will win by serving this rising demand with products people want—not because they’re sustainable, but because they’re better, faster, or cheaper.

Building the Adaptation Deal Pipeline

In a similar vein to the Adapt [us] thesis that the best adaptation plays won't call themselves "climate companies," I've been looking at early-stage companies solving immediate problems in a warming world.

Startups that wouldn’t necessarily categorise themselves as a traditional Climate Tech, or even, Climate Adaptation Technology play, with 5 examples below:

• Transparent Path (Seed) - Cold chain intelligence preventing $18B in food spoilage

• SQUAKE (Seed) - Carbon APIs for travel platforms adapting to “flight shame”

• Boon (Series A) - Water-as-a-Service for hotels facing scarcity

• ChromoGenics (Series A) - Dynamic windows cutting cooling costs by 40%

• Clim8 (Series A) - Smart thermal clothing with 50+ patents
  

These investment opportunities aren't waiting for more mature carbon markets or regulations from the public sector, they are attempting to deal with the effects of a new climate induced reality now.

Hotels need Boon's water recycling today and food distributors need Transparent Path's spoilage prevention now. The warming world is already their market driver. Each has <$10M raised, proven commercial traction, and billion-dollar total addressable market that will only accelerate with climate induced change

Tracking more companies riding hidden climate demand?

Get in touch - I'm building a comprehensive database of overlooked adaptation opportunities.

Events

Climate Adaptation: Technology Showcase & Reception, Monday 23 June, 15:00 - 19:30, London.

​If you’re in London in late June and interested in how technology plays a role in Climate Adaptation, this event is for you. Bringing together founders, investors, and corporate partners and meeting 10 ‘CAT’ companies in the tech showcase….