Meet the cleantech investor who helped build one of Canada’s largest and most active climate funds

“The world really is a different place now,” says Susan Rohac, who helped establish BDC’s Climate Tech Fund.

On Susan Rohac’s LinkedIn page, in the field where people typically add a job title, you’ll find something that amounts to both a credo and an apt summary of her proudest professional achievements: “Stopping Global Warming — One Investment at a Time.” Rohac, who retired from the Business Development Bank of Canada (BDC) in May after more than 34 years at the organization, has spent the last eight years working to direct crucial capital solely toward companies developing technologies that can help restore the planet. As the managing partner of BDC’s Climate Tech Fund, she helped identify some of the country’s most promising ventures in energy, mobility, built environment, industry and resources, as well as carbon management, and assembled a cross-country group of VCs to help those ventures move closer to commercialization.

When Rohac began this leg of her career, President Donald Trump, then just six months into his first administration, had just proclaimed his intention to withdraw the United States from the Paris Agreement. Her retirement comes just as Trump has taken steps to follow through on that threat again, as well as unleashing a cavalcade of economic and environmental policy decisions that could have dire repercussions for Canada’s cleantech ventures and the world as a whole.

Although Rohac acknowledges the challenges posed by the volatility of our neighbour to the south, she says that the changes she has witnessed over the past eight years have left her with a sense of optimism. Here, she explains where Canada has the most potential to grow, how cleantech ventures can strategically weather economic uncertainty and why we need to shift the way we talk about the benefits of climate technologies.

How did your work in the climate space at BDC start?

Back in 2017, the federal government was hearing from a lot of people that there was a significant lack of capital for Canadian climate tech companies, so they tapped BDC to do a bit of stakeholder engagement. Originally, we talked to as many stakeholders as we could — so, other investors, associations and a lot of cleantech companies across the country — to find out where the funding gaps in the Canadian ecosystem were. The clear message was that there was this momentum and build-up of amazing technologies happening within Canada, thanks in part to SDTC (Sustainable Development and Technology Canada), which was doing a lot of early-stage seed capital, but then there was this chasm. We did a white paper for the government and talked about how we could potentially play a role. And sure enough, there was money in the 2017 budget for BDC to start a climate initiative of $600 million. There were a lot of funds that were struggling to close; finding LPs was difficult because up to that point there was very little track record of successful climate funds. We picked three Canadian funds to help kick-start the Canadian investment ecosystem, and then we built a pan-Canadian team of seasoned investors with climate domain expertise. With our first fund, we were able to support 50 Canadian cleantech companies — that’s a very big portfolio. It made us one of the largest and most active climate investors in Canada in record-breaking time. We were doing deals at a pace that was unprecedented in the venture capital space in Canada.

How have things changed since you launched that fund?

The world really is a different place now. Things have clearly changed. Seven short years later, many countries, the economic powerhouses of the world, have all set net-zero targets. In addition to that, lots of multinational companies and even smaller companies have set net-zero targets. That’s important, because the second you set a net-zero target, you’ve got to start looking for technologies to implement to get you to your targets.

What measures are necessary over the next three to five years to sustain that momentum?

The thing that has to change — which we’re seeing right now in Canada and the U.S. — is that unfortunately, climate has become politicized. That started to happen in the late ’90s, but it’s been growing, and you can blame that on a couple of things. The first thing is awareness: As the public became more aware of climate and there was scientific consensus around what was happening, there was increasingly a call for action, and it became part of people’s political agendas — that could be good, but it became part of people’s political agendas not to support it as well.

Another thing that happened is economic interest. The oil and gas sector, seeing that this movement was starting up again, made sure there was a political agenda to stop it from happening. And the other thing was that a lot of media and messaging around climate change positioned it to be a political agenda.

To depoliticize this — or make it something every political party sees the importance in — we have to talk about climate technologies and climate projects not just for the benefits of GHG reduction and emission reduction, but also the economic benefits that these projects bring to Canada and North America. They’re hiring people, they’re building and selling products, there’s opportunities for large exports. And we have to start talking more about the success stories. Maybe in the ’90s there weren’t any, but certainly now we’re starting to see a lot of successes within climate, with companies that are absolutely creating jobs and economic profits. We don’t talk enough about those.

Given the recent policy shifts in the U.S. and overall geopolitical uncertainty, what should cleantech companies do to hedge their bets against more regulations or changes in the political environment?

That’s a really good question. The answer is: expand your supply chain. Where are you getting your supplies? Is there an opportunity to have second and third sources lined up in case tariffs affect some of your supply chain and export markets as well? But even though the U.S. is our largest trading partner — and will, I hope, always be a very important trading partner — there are other jurisdictions where our climate technologies can play a key role. We’re seeing companies like Hydrostor with projects outside of North America. I think expanding the horizons of where we can sell is going to be very important for climate tech companies.

Where is the biggest potential export market for Canadian companies?

It depends on your technology. The EU has not slowed down on climate initiatives, and is looking for additional sources of energy, so I think it would be a wonderful market for a lot of Canadian companies. I also don’t think that you can put the United States all in one bucket. There are states in the U.S. that still have a climate agenda and are not backing down. In fact, even though the Trump administration has pulled out of the Paris Agreement, 24 states, which represent 60 percent of the U.S. economy, have signed back up on their own.

Where do you see the most growth potential in Canada in terms of cleantech?

Canada has the ability to be a powerhouse in terms of critical minerals and the battery supply chain, and I hope we deliver on that. It’s not just mining — it’s upgrading the minerals and the entire supply chain. There’s no reason we can’t go from mine to battery here in Canada. Energy as well: We’ve been so reliant on oil and gas that we forget that Canada has other opportunities with respect to wind, solar, geothermal, hydrogen and different types of energy storage systems. We’re also seeing a lot of interesting technologies coming to fruition in the built environment, like low-carbon concrete and new building techniques. Especially as we’re facing a housing crisis and will be doing a lot of building over the next century, there’s an opportunity for Canada to do it differently.

The other area where I think Canada has a huge role to play is in the food and ag space. Canada is a trusted food source for many countries, and we have an opportunity to continue to build that with a much lower GHG footprint. Look at Canada’s natural resources: our land, our power, our food. These traditional industries, from fishing to farming, have an opportunity to become huge exports, but with climate technologies that make them cleaner and greener.

For international investors who are considering investing in Canada, what’s your pitch?

Canada is a great place to invest in for a few reasons. One is the ecosystem we have — there are a lot of associations and entities supporting climate. MaRS is a perfect example of an entity supporting climate champions they can work with. There’s an educated population in Canada that understands climate — not only from a workforce perspective, but in embracing these technologies as well. We have a government — currently, and hopefully in the future — that understands the importance of this transition.We have an educated workforce of everyone from HR experts to engineers to software people to make these companies work. And finally, because Canada’s geography is so diverse, there’s opportunities in different spaces, from geothermal to carbon capture to ocean technologies.

As you gear up for retirement, have you thought about what comes next in your climate journey?

I do want it to continue. I haven’t fully baked that yet, but this is something I’m really passionate about and I’ve got some good energy and a brain that’s working most days. I would like to stay engaged, and I’m looking for opportunities to do that, whether it’s on advisory committees or on boards or working with some associations. I suspect that you’ll see me pop up somewhere!

Are you a climate tech investor interested in getting connected to the MaRS Climate team? Reach out to Leah Perry, senior manager in cleantech at MaRS, to learn more.