CLIMATE-TECH FUNDING IN INDIA: BEYOND SEED FUNDING—EARLY-STAGE GAPS & HOW TO BRIDGE THEM.

• Publish on Aug 12, 2025
• Read Time 5 mins

India's climate startups have brilliant solutions, but they're short on funding that supports them through various stages of the business. Let's explore this problem and find solutions.

1. The Climate-Tech Boom and the Funding Freeze

   India’s climate-tech sector is buzzing with innovation. From electric vehicles and solar rooftops to carbon capture and clean farming, startups are building the tools we need for a greener tomorrow. But there’s a problem: most of them stall early in their growth.

   While many young startups get seed funding, only a tiny fraction, just 3 percent, according to the Climate Finance Initiative, manage to raise Series A and beyond.

   And this isn’t just a startup problem. It’s a climate problem.

   India has set big goals: 500 GW of clean energy by 2030, and net-zero emissions by 2070. If we can’t help climate-tech businesses grow, we risk delaying the solutions needed to hit these targets.

2. What’s Stopping Climate-Tech Startups from Scaling?

   • Too much focus on the start line
     Investors are open to funding the first stage but hesitate to support growth. It’s like planting seeds but forgetting to water them.
     Startups often get capital to launch a pilot, but not enough to expand, build teams, or reach customers on a scale.
   • Hard-tech is harder to fund
     Unlike software, climate-tech often involves physical products like solar panels, batteries, or clean energy systems. These take time, money, and patience to build, something many investors shy away from.
     That’s where platforms like Ecofy step in. We offer green loans, with access to an attractive liability pool consisting of low-cost global climate dedicated funds.
   • Rigid financing options
     Most climate-tech startups don’t need just equity; they need flexible loans, revenue-based debt, or blended finance. But India’s system still relies heavily on traditional funding.
     At Ecofy, our offerings range from solar panel loans to EV finance and empower growth through flexible, sustainable solutions, including instant credit access.

3. Investors don’t know what to look for

   Many investors don’t have a framework to assess the climate impact of a business. They treat ESG criteria like a checklist instead of a real value driver.

   Ecofy is bridging India's climate finance gap, particularly in the retail sector, by partnering with individuals and businesses committed to reducing their carbon footprint and restoring balance to the planet.

   Why bridging this gap matters now

   To meet its climate targets, India needs $200–250 billion every year in climate-focused investments (as estimated by Deloitte & GGGI). Climate-tech startups are key to this shift, but without funding, they stay stuck in pilot mode.

   No capital = no scaling = no impact.

4. How to Bridge the Gap

   Blending capital to boost green startups
   Mixing public and private funds, using low-risk capital, or offering guarantees can make early-stage funding safer and more attractive.
   At Ecofy, we already do this through low-barrier green loans that support sectors like clean mobility, solar energy, and sustainable SMEs.

   Working with climate-specialist fundraisers
   Most startup incubators don’t understand clean tech. Founders need sector-specific help, especially in smaller cities and towns.
   Ecofy is building a new-age eco-financing system with features like bundled products, leasing options, assured buybacks, and extended warranties, whether you're applying for a loan for electric scooter purchases or an SME business loan for clean energy solutions.

5. To show climate impact, transparency is essential

   Startups need clear, credible ways to measure and share their impact, like how much carbon they cut or energy they save. The funding world needs more people who understand how green businesses work and why they matter. The more investors understand climate tech, the more likely they’ll support it beyond the seed stage.

   Final Word: It’s not a startup problem. It’s a scaling problem.

   India has no shortage of green ideas. What we lack is the funding to help them grow.

   At Ecofy, we’ve acquired a customer base of 90,000+ customers with an impact of 2,88,251+ tonnes of carbon emissions saved.

   Because building a greener future isn’t just about starting strong. It’s about scaling smart.

FAQs

1. Why is there a funding gap after the seed stage?
   Most investors are hesitant to fund capital-heavy, long-gestation climate-tech startups beyond seed stage.
2. What challenges do climate-tech startups face?
   Limited flexible financing, risk-averse investors, and unclear impact metrics.
3. How can startups bridge the gap?
   Work with climate-aligned lenders, join accelerators, and clearly showcase impact.
4. How does Ecofy help climate-tech businesses?
   Ecofy supports clean mobility and energy access with hassle-free, collateral-light loans designed for quick turnaround and long-term impact.