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🐝 Bees Against Honey: Should Climate Startups Exit to Big Oil?🍯

Writer: Emin AskerovEmin Askerov

According to Sifted, one of the main exit strategies for European climate tech startups is selling to Big Oil. Is this a smart way to convert the 'Evil Empire' to the light side or just a way for oil majors to bury the competition under a fossilized rug?





The Reality of Corporate Acquisitions:

Regardless of industry, large corporations have an impressive track record of suffocating startups - even when they mean well. A former Engie executive once told me: “Every time we acquired a startup, our biggest headache was how to not accidentally kill it.” This fully resonates with my own experience working with startups in Rosatom, a Russian state nuclear corporation. 


Why? Because corporate culture and procedures designed for stability and control are the exact opposite of a startup’s agile, fast-moving environment. When a startup is absorbed into a corporate structure, 9 out of 10 times, it dies a slow “death-by-a-thousand-cuts” from bureaucracy.


What Makes an Acquisition Work?

The only startups that survive inside corporations are those that have already evolved beyond the 'scrappy' phase into solid, process-driven businesses. Their culture and operations begin to mirror that of a corporation - with structure, systems, and scalable processes.


I saw this firsthand at Rosatom, when it acquired a carbon fiber manufacturing "startup" that didn’t just survive - it thrived. Why?


  1. Maturity: The company already ran its own factories - it was a startup by name, but a business by operations.

  2. Autonomy: Rosatom kept the existing management team intact and let them run the show without micromanagement.


Can Big Oil Really Change Its Spots?

I struggle to believe Big Oil genuinely intends to profit from energy transition technologies unless those technologies help them extract more oil (hello, CCS). It's not cynicism; it's capitalism. Boardrooms answer to shareholders, and shareholders demand returns.


Bees don’t fight against honey. Neither do oil companies work against their core business.Even if there are true believers in the C-suite, they still face the same internal integration issues that kill most acquisitions.


So, Should You Sell to Big Oil?

  • If you’re an early-stage startup hoping for impact, your chances of survival post-acquisition are slim. But then, if you are in it for money, exit to Big Oil may seem very enticing. 

  • If you’ve built a resilient, process-driven company and can negotiate operational autonomy, you might make it.


But if you believe that Big Oil is buying you to "save the planet," think twice. Their shareholders likely don’t share your vision.


What’s your take? Would you sell your climate tech startup to Big Oil?


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© Emin Askerov, 2023.

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