On 11 November 2024, Climate-KIC hosted the first online meeting "Financing Opportunities & Challenges for Adaptation Enterprises". This event gathered ecosystem players, including funders, investors, NGOs, start-ups, and others, to explore pathways for advancing climate adaptation in regions such as Africa and Latin America. Examples of reef conservation, sustainable agriculture in Africa, and investment in food and agricultural value chains led to broader discussions on access to finance and potential pathways for climate adaptation. Below are some key insights and lessons learned.

• Lack of Adaptation Focus Among Start-ups and MSMEs: Start-ups and MSMEs in emerging economies often do not prioritize climate adaptation, partly due to limited awareness. Even enterprises working in this space may not view their contributions as “adaptation solutions.”
• Increased Awareness Needed in the Global South: Emerging economies need greater understanding of adaptation, resilience, and related technical aspects.
• Missed Financial Opportunities : Due to limited understanding of adaptation, many start-ups and MSMEs miss out on financial support available for adaptation-focused projects.
• Solution Pathways: Showcasing global examples of successful adaptation-focused enterprises could inspire start-ups/MSMEs to recognise themselves as providers of adaptation solutions.
• Long-term Private Sector Engagement: Early-stage climate innovations often involve high initial costs and lack immediate returns, making them less attractive to investors seeking quick financial gains. The challenge, and opportunity, lies in building alignment between entrepreneurs and the investor community around new ways to view value and impact, with a shared commitment to long-term adaptation goals.
• Complex Challenges for Emerging Economies: Emerging economies face multiple ongoing constraints, including limited policies, restricted access to funding, and educational constraints. Climate adaptation becomes yet another challenge to face.
• Funding Challenges for Early-Stage Start-ups: Early-stage start-ups frequently rely on grants or limited funds, making them less appealing to private investors. Alternative financing models are needed to bridge this gap, as traditional banks are often reluctant to support them due to low credit ratings.
• Essentials for a Climate Adaptation Community: To create a supportive climate adaptation community, participants need access to best practices, foundational knowledge about adaptation and climate change, and a clear understanding of the long-term impacts of climate change.