Investing at the Intersection of Climate and Innovation
A Conversation With Rick Zullo and Enki Toto
This week, the global climate conversation will descend on New York City for Climate Week. It's an annual moment where leaders from government, business, and civil society converge to discuss, debate, and drive action on one of the most pressing issues of our time. But while the main stage events often grab headlines, some of the most critical dialogues happen behind the scenes, away from the lecterns and formal panels. They take place in hotel lobbies, at informal roundtables, and between people tasked with funding the future of innovation that is at once our biggest hope and greatest challenge.
The narrative around climate action is often framed by a sense of foreboding; a seemingly insurmountable challenge with few clear paths forward. But, there are places where technological innovation and market forces are powerful allies in the fight. Venture capital firms are not just observers in this shift; they are active participants — betting big on the entrepreneurs and technologies battling climate change and helping the world become more sustainable.
To get a sense of this evolving landscape, we brought together two leading voices in the space for a conversation: Enki Toto, a Principal at Salesforce Ventures, and Rick Zullo, Founder and Managing Partner of Equal Ventures. They explored the forces making climate tech a core focus for their firms, the surprising role of AI in accelerating climate solutions, and what keeps them energized in the face of political and market headwinds. The following is a peek into their conversation and how they’re thinking about shaping the future of climate innovation.
Q: Let’s start with the big picture. Why is climate tech such an important focus for both of your firms?
Rick Zullo: Climate is the defining challenge of our time, but it’s also one of the biggest opportunities. The transition to electrification, grid modernization, new materials, resiliency and adaptation — these are markets measured in the trillions. At Equal Ventures, we invest early, often before it’s obvious, and climate is where we see founders tackling problems that really matter.
Enki Toto: For Salesforce Ventures, the Impact Fund is about backing solutions that drive both climate impact and enterprise adoption. We look for technologies that can scale globally — energy management, supporting sustainable energy generation, supply chains, and increasingly managing the impacts on the climate of AI adoption — but always with an eye to where they intersect with Salesforce’s ecosystem and enterprise needs.
Q: From your perspective, what makes this an exciting time in climate tech?
Rick Zullo: Compared to past cycles, I think what’s most exciting right now is the distribution of different nodes in a network that is making the grid increasingly look more like the internet. This is a challenge that digital/software investors are fundamentally better positioned to solve than some of the more supply-side R&D efforts of the last cycle. The manual methods for orchestrating supply and demand side of energy are extremely cumbersome and inefficient and the digital technologies we have available to us provide the opportunity to deliver incredible value. With the explosion of distributed devices, autonomous technologies that are capable of managing and dispatching their use are going to have a huge impact.
Enki: For the first time, I feel like energy is taking center stage at almost every discussion, regardless of the room or industry, because of this influx in demand due to AI. This feels like a moment where clean tech and grid modernization isn’t just something we need to do, but something businesses are excited to do in order to succeed in this next phase of the economy.
Q: Rick, you invest at the early-stage, whereas Enki your focus is more on later-stage businesses. How do you think your perspectives differ, and where do you think there’s alignment?
Rick Zullo: We need to know if we’re right earlier than most. We’re deeply focused on if we’ve been able to prove a flywheel and network effect with a business as early as possible (generally before the Series A, which is when we usually are writing our largest check into a company), so we can be sure we have a long-term winner. This helps reduce the capital intensity and, ultimately, the dilution we take as investors.
Enki Toto: By the time we come in, it’s less about “will this work?” and more about “can this scale?” We want to see customer traction, strong economics, and operational readiness. The two stages feed into each other — Rick and his team see the future 3-5 years before we see it, help validate frontier bets, and we help scale the ones that prove out.
Rick Zullo: I’d also add that I think collaboration across asset classes is underrated and underappreciated. It’s also needed more than ever before. Every one of the companies we’re working with is also working with an investor from a different type of asset class, whether it be working capital, infrastructure capital, real estate funds, or partnering with PE firms as a means of distribution. Venture is one form of capital, but there are a lot of lessons to be learned from those deploying hundreds of billions of dollars in energy across the value chain. One person/firm isn’t going to solve this alone. Often the biggest opportunities are going to require investors from all forms of capital to work together. We believe that ”a rising tide raises all ships” and the prize is big enough for all of us to share so we’re happy to have more folks join our fleet.
Q: Are there certain segments of the market that you feel are currently overlooked by investors?
Enki Toto: Up until now, I’d say grid software companies. They were being supported by sector specific VCs rather than attracting large generalist investors. And I think that’s changed recently as these companies have taken off and shown that there’s a clear need for them.
Rick Zullo: Historically, a lot of money has gone into certain pockets of the market where it’s easy to deploy large dollars. In the last clean tech cycle, two thirds of dollars went to that hard tech, deep tech space, and it returned 30 cents on the dollar. Meanwhile, traditional software companies returned 3x capital. And I think we’re seeing it again now with more capital going to large scale, high tech, and risky projects like carbon capture and nuclear than I personally believe should. There’s even more software companies now than in the last cycle, but I still feel a lot of that is overlooked, especially as it relates to working with utilities and the grid. I also think emerging markets are tremendously underrated — the business case for new energy projects in those markets is simply far better than it is here in the U.S. and the demand for energy is exploding in these countries. That creates a lot of opportunity and the incumbent infrastructure that you’re competing against makes it a lot easier for things to take off.
Q: With shifting policies around climate, what keeps you optimistic?
Enki Toto: The pace of innovation. Every week we meet founders doing things that weren’t possible ten years ago — in storage, energy efficiency, grid modernization, etc.. That urgency paired with ingenuity gives me hope.
Rick Zullo: A greener future is inevitable. There’s no version of the world where clean energy isn’t the cheapest form of energy. There is no version where it isn’t the easiest for us to bring online. Political beliefs get pushed left and right, and things are more challenging now than a few years ago, but there’s a terminality where this has to happen. The economics just make sense.
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Salesforce Ventures and Equal VC are proud to partner on this year’s Climate Capital Summit, taking place September 24th in New York City during Climate Week. For more information, visit the Climate Capital Summit website >>>