Greenwashing to greenhushing?

In my working closely with climate innovators and venture funds, I’ve observed an accelerated positioning shift in response to the ESG backlash and Trump’s reelection: Greenhushing.

Greenhush (verb) /ɡriːn hʌʃ/: To understate or conceal a venture or fund's initial emphasis on positive climate impact, shifting focus instead towards financial returns through "energy efficiency", or "future-proofing".

e.g.: CarboSolar now emphasises to investors their customer's cost savings, rather than the positive carbon impact.

Antonyms: Greenwashing, eco-exaggeration.

The hush rush flips the script on Greenwashing, as climate impact is downplayed in favor of how a solution is faster, better or more efficient.

There are healthy elements to this approach. Rather than rely on consumers paying a green premium or governments providing subsidies, these ventures lean into their value using terms that investors understand: financial benefits.

Trump’s re-election in November significantly dampened expectations for climate-first investor narratives. One Trump term may have been an anomaly, but winning more than 60 million votes in three elections clearly marks a tectonic shift away from the climate agenda that is now seen in the US context as a Democratic party platform.  

Even as their innovators back away from climate-first, quite a few VCs expect the current climate subsidies and supports that benefit their ventures to endure under the Trump administration. Elon Musk has a powerful pulpit to advocate for electric vehicles and many of the Inflation Reduction Act’s climate initiatives create jobs in Republican states.

After a thorough post-election portfolio review, Christian Hernandez co-founder of the climate-focussed 2150 VC fund wrote: “Our portfolio generally looked safe and we seldom back companies based on policy tail-winds or grant financing.”

The biggest risk will come from tariffs impacting supply chain imports and therefore the unit economics of many solutions, but perhaps also triggering a trade war with current partners, impacting international sales, Hernandez added.

A well-considered Greenhush can bring important advantages over a green premium, added Samuel Alemayehu, co-founder of C1 Ventures.

“I have personally seen many take the Greenhush route to avoid the perception of being reliant on a Green premium,” Alemayehu said. “For climate overall, it is crucial that we break this narrative that green always requires compromises.”

Silence of the startups (and incumbents)

In that context, Hernandez and others emphasized the importance of innovators explicitly demonstrating value beyond “good for the climate”.

“None of our founders wants to be seen as climate companies,” Hernandez said. “The business case has to be about price parity or better performance.”

What should Climate Innovators do?

The good news is that many climate innovators can adapt their messaging to this new environment.

Smart innovators have always told investors about their business first, showing how it projects towards profitability. This strategy’s value is that you broaden your investor base beyond those with narrow environmental objectives.

This shift is not just about messaging—it reflects a deeper understanding of investor psychology. Investors are increasingly wary of ventures that rely heavily on regulatory support or green premiums, and climate innovators must adapt accordingly.

But how can you do it? 

Adapting to this business-first narrative can often be accomplished by course correction in how you present the business, rather than a change in business strategy.  

The ideal positioning pivot builds on your existing strengths to describe them in a way that appeals to a broader audience.

The founder of one cleantech startup recently shared with me how their pitch evolved from their product's ability to cut emissions by 20% to a focus on how it reduces energy costs for customers by 15%. The number may be lower, but it will resonate more with investors.

Our experience is that almost by definition many sustainability-focussed innovations create efficiency advantages for customers. These advantages might bring cheaper electricity, fuel savings, or just easier regulatory compliance. But what they have in common is that they all save the customer money or unlock value, for instance, through data.

Telling your investor narrative in a way that focuses on efficiency will derisk your business in investor eyes with the reassurance that you are not dependent on regulatory advantages or green premiums.

In sum, innovators looking to adapt to the new landscape for climate should consider three steps:

1- Reframe Your Value Proposition:

Highlight cost savings, efficiency, or performance improvements rather than leading with environmental benefits.

2- Broaden Your Investor Appeal:

Craft a narrative that resonates with both climate-conscious and traditional investors.

3- Leverage Data:

Use metrics that demonstrate financial returns alongside or ahead of environmental impact.