Greetings to nearly 4k Impact Supporters! 🌍 This is Jonas writing 👋 In today’s episode, we sit down with Praveen Sahay, co-founder of Wave Equity Partners in Boston. WAVE sits at the unique intersection of venture capital and private equity backing tech and manufacturing-driven companies that scale profitably without the need for subsidies.

From his beginnings as a nuclear physicist in India to serving in UN peacekeeping missions and now three decades as an investor, Praveen brings a rare combination of science, leadership, and global perspective. We spoke about what went wrong in Cleantech 1.0, how to build lasting companies that avoid past mistakes, and why optimism is warranted, even as geopolitics get more complex.

Agenda

* Praveen’s extraordinary journey: from physics to peacekeeping to VC 🎓🌍

* Lessons from Cleantech 1.0: why government subsidies distort markets ⚡

* WAVE’s philosophy: “If it’s not profitable, it’s not sustainable” 💡

* Why focusing on hardware matters for climate solutions 🔧

* Navigating US–EU ecosystems under geopolitical tension 🌐

* Closing reflections: optimism through Hindu philosophy ✨

Meet Praveen Sahay 👨‍🔬

Praveen’s journey is anything but ordinary. Born in India, he studied nuclear physics, worked in oil & gas, served as a captain and later lieutenant colonel in India’s Central Industrial Security Force, and even coordinated Mozambique’s first democratic elections as a UN peacekeeper

After an MBA at the University of Chicago, he was drawn into venture investing, attracted by its entrepreneurial spirit and the ability to connect science, people, and impact. With co-founders Mark Robinson and Haskell Crocker, he launched Wave Equity Partners in 2013 to back companies others ignored after the collapse of Cleantech 1.0.

Cleantech 1.0: What Went Wrong? 🚨

Praveen is candid: the first cleantech wave collapsed because governments distorted the market. Subsidies for biofuels, solar, and batteries encouraged investors and entrepreneurs to chase unsustainable economics.

“If it’s not profitable, it’s not sustainable. Subsidies may help in the short term, but they create false markets and kill innovation”

His antidote: invest only in companies with proven products and strong gross margins (40%+). WAVE focus is on those already in the market, demonstrating superior economics and carbon impact.

WAVE’s Playbook 🌊

Key principles of WAVE’s investment model:

* No subsidy dependence: Core business must stand on its own.

* Capital efficiency: Avoiding capital-intensive models with long adoption cycles.

* Hardware focus: Real climate solutions need physical products, not just software.

* Deep diligence: WAVE has never invested in a company in less than 6 months, often with no other financial investors at the table.

* Strategic partnerships: Success depends on linking startups with industrial leaders (e.g., OEMs, global manufacturers).

The result: WAVE sees about three dozen companies per year that truly meet their criteria

US vs. Europe: Two Ecosystems 🌍

Praveen has grown WAVE’s presence in Europe, noting cultural differences. In Germany, employees once feared he was a “capitalist coming to fire them.” But his approach is hands-on partnership, not restructuring.

Despite bureaucratic hurdles (yes, still wet signatures at notaries in Germany!), Praveen sees Europe’s entrepreneurial spirit awakening. Yet, he also points out a vacuum: too few growth-stage investors willing to back hardware-heavy, industrial solutions.

Optimism Through Hindu Philosophy ✨

Despite tough fundraising markets and geopolitical turbulence, Praveen remains optimistic:

“Civilization moves in cycles, from golden eras to dark eras and back. We are now entering a new up-cycle. Human creativity is immense, and I believe we are on the path toward a better future”

His reminder: while climate investing is hard, the rewards, societal and financial, are transformative.

Closing 🌟

Praveen’s perspective is a refreshing antidote to hype cycles. His hard-nosed discipline on profitability, combined with long-term optimism, is exactly what the impact ecosystem needs.

Tell us what you think: Are we entering a new “golden era” for climate investing? Reply to this newsletter or drop us a note at [email protected].

Thanks for reading,Jonas Ahm-Lundgren

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit impactvc.substack.com