Two experienced investors in climate technology — Prelude Ventures Managing Partner Mark Cupta, M.B.A ’13 and Activate Capital Managing Partner Raj Atluru, M.B.A. ’97 — outlined approaches to developing successful climate tech startups amid regulatory uncertainty at a Stanford Energy Club (SEC) meeting Wednesday.

“The goal of the club is to treat every energy sector equally and tackle the problem from all fronts,” SEC president Rohan Parekh M.S. ’26 said after the meeting. 

Despite significant advances in decarbonization techniques, regulatory shifts under the Trump administration could force top climate tech investors like Cupta and Atluru to develop new strategies and prepare their companies for uncertainty. 

“Climate is an essential part of every macroeconomic chain on the planet,” Cupta said. 

However, Cupta said matching investment strategy with all of the competition within climate tech can be challenging. For Atluru, balancing a focus on decarbonization with the responsibility to generate excellent products requires weighing the risks of investment while addressing the most pressing sustainability issues.

“You have to answer the question, ‘Why now?’ What’s happening now that will cause real growth in the industry, and why could any piece of competition stand out as being important?” Atluru said.

Cupta said the best way to reduce greenhouse gas emissions was to focus on methane and understand its value in terms of potential profit and sustainability impact. 

“I would take all the money going into CO2 capture and dedicate it toward methane, as it has a much more punitive impact [on the climate] on a short-time horizon,” said Cupta.

However, with government funding changes underway, the future of sustainability investment is more uncertain than ever.

There has been substantial support for domestic energy production through the Inflation Reduction Act (IRA), but if these tax credits disappear in the Trump administration, a myriad of business projects will fall apart. 

“Uncertainty kills startups,” Cupta said. 

Cupta and Atluru encouraged people not to become disheartened, as the last boom cycle for climate action actually started during the prior Trump Administration.

“The attitude was —’ screw it. The government’s not going to do it, so we’ll do it ourselves,’” Cupta said. 

Cupta added that people are much better prepared going into the second Trump administration, although the challenge itself is more daunting this time around.

“There is more to lose, and another government branch has been politicized in the courts, which makes it harder to fight some of these things,” said Cupta.