Investment Thesis
AI for Good Fund
1. Problem Statement
Humanity faces unprecedented, complex crises, including climate change, energy security challenges, and resource depletion. Addressing these requires the urgent development of innovative technologies like commercial fusion, carbon offsets, and Sustainable Aviation Fuel (SAF). However, we must simultaneously consider the potential socioeconomic disparities and exclusion that technological advancements can create. Artificial Intelligence (AI), in particular, holds immense potential to accelerate the development and refinement of these cutting-edge technologies. Yet, if its benefits are not distributed equitably, AI risks exacerbating existing inequalities.
Furthermore, the rapid advancement of AI technology is accelerating environmental degradation, particularly water pollution. Data centers and semiconductor manufacturing—the backbone of AI infrastructure—require massive amounts of water for cooling and processing, while generating significant thermal and chemical pollution. This creates a paradox: the very technology that could solve environmental challenges is simultaneously exacerbating water scarcity and contamination issues globally.
Water scarcity and food security are inextricably linked. Agriculture accounts for approximately 70% of global freshwater withdrawals, making water availability a critical determinant of food production capacity. As climate change intensifies droughts and alters precipitation patterns, and as AI-driven industrial expansion further strains water resources, the need for innovative water treatment, desalination, and purification technologies becomes paramount for ensuring global food security.
Viewed through the lens of Maslow's Hierarchy of Needs, technological progress should primarily contribute to fulfilling fundamental human needs, such as physiological and safety requirements—with clean water and food security representing the most basic physiological necessities. An inclusive approach is essential to ensure no one is left behind as we progress towards meeting needs for belonging, esteem, and self-actualization.
2. Vision
The AI for Good Fund aims to harness AI to accelerate innovation in key sustainable technologies (commercial fusion, carbon offsets, SAF, water desalination and purification, and food security solutions). Guided by Maslow's Hierarchy of Needs, we will ensure social inclusivity throughout this process, contributing to a world where the benefits of technological advancement are shared equitably across all of humanity.
3. Mission
• Invest: Identify and invest in early-stage startups utilizing AI as a core driver for innovation within the commercial fusion, carbon offset, SAF, water technology, and food security sectors.
• Nurture: Actively support and cultivate portfolio companies not only to achieve their technological goals but also to uphold social and environmental responsibility and pursue inclusive growth.
• Connect: Build a synergistic ecosystem for AI-driven sustainable technology by fostering collaboration among technology developers, policymakers, social enterprises, civil society, and other stakeholders.
• Measure Impact: Realize the fund's core values by measuring and managing environmental impact (e.g., contribution to carbon reduction, water conservation, food production enhancement) and social impact (e.g., technology accessibility, job creation, inclusion of marginalized groups) alongside financial returns.
4. Investment Focus
Target Technology Sectors
Commercial Fusion: Startups using AI to solve key challenges in fusion commercialization, such as optimizing plasma control, predictive maintenance, accelerating new materials discovery, and enhancing simulation accuracy.
Carbon Offset: Startups leveraging AI for precise Measurement, Reporting, and Verification (MRV) of carbon storage/sequestration (via satellite imagery analysis, sensor data processing, etc.), improving the efficiency of Carbon Capture, Utilization, and Storage (CCUS) technologies, and building transparent, reliable carbon credit market platforms.
Sustainable Aviation Fuel (SAF): Startups employing AI to optimize feedstock sourcing (like biomass) and logistics, improve conversion process efficiency, predict fuel performance, and intelligently manage supply chains to reduce SAF production costs and accelerate adoption.
Water Desalination and Purification Technology: Startups utilizing AI to revolutionize water treatment processes, including: (1) AI-optimized reverse osmosis and membrane filtration systems that reduce energy consumption by 30-50%; (2) Machine learning-driven predictive maintenance for desalination plants to maximize operational efficiency; (3) Real-time water quality monitoring and contamination detection using AI-powered sensor networks; (4) Smart water distribution systems that minimize losses and optimize resource allocation; and (5) Novel materials discovery through AI for next-generation filtration membranes and water purification catalysts.
Food Security Innovation: Startups leveraging AI to address global food security challenges, including: (1) Precision agriculture platforms using AI/ML for optimized irrigation, fertilization, and pest management; (2) Climate-resilient crop development accelerated through AI-driven genomic analysis and breeding programs; (3) AI-powered supply chain optimization to reduce food waste and improve distribution efficiency; (4) Vertical farming and controlled environment agriculture systems optimized by machine learning; (5) Alternative protein production (cultivated meat, precision fermentation) enhanced through AI process optimization; and (6) Water-food nexus solutions that integrate water management with agricultural productivity.
Role of AI Technology: AI must be central to solving core problems and significantly improving the technological/economic viability within these sectors, not merely an auxiliary tool.
Selection Criteria
• Clear and innovative AI technology and solutions.
• A team with deep understanding and expertise in the target technology sector.
• A scalable business model and significant market potential.
• A plan to generate measurable environmental impact.
• Consideration for Social Inclusion: Preference will be given to teams demonstrating awareness of potential social impacts (job shifts, community effects, technology access, water equity, food accessibility) and possessing plans or commitment to mitigate negative effects or create positive social outcomes, reflecting the principles of Maslow's Hierarchy.
5. Social Inclusion Principle (Maslow's Hierarchy Integration)
Throughout the investment decision-making and portfolio nurturing process, the AI for Good Fund will adhere to the following social inclusion principles:
• Contribution to Basic Needs: Encourage the development of technologies that ultimately contribute to fulfilling fundamental human needs for safety (e.g., climate stability) and physiological well-being (e.g., clean energy, clean water, food security).
• Accessibility and Fairness: Support portfolio companies in exploring ways to ensure the benefits of their technology are accessible and affordable to a broader population, avoiding concentration in specific regions or demographics (e.g., considering energy poverty, water poverty, food deserts, ensuring local community participation and benefit-sharing in carbon offset projects).
• Just Transition: Collaborate with portfolio companies to consider and potentially support initiatives like reskilling and job transition programs for workers and communities potentially affected by technological shifts.
• Diversity and Inclusion: Promote diversity within the founding teams of portfolio companies and support the establishment of inclusive cultures throughout their operations.
6. Expected Impact
• Accelerated Technological Innovation: Expedite the development and commercialization timelines for next-generation sustainable technologies through AI.
• Contribution to Climate Action: Contribute significantly to greenhouse gas reduction and enhance climate change adaptation capabilities.
• Enhanced Water Security: Expand access to clean, affordable water through AI-driven desalination and purification technologies, addressing the needs of the 2+ billion people currently lacking safe drinking water.
• Strengthened Food Security: Improve agricultural productivity and resilience, reduce food waste, and enhance food distribution systems to address global hunger and nutritional challenges.
• Sustainable Economic Growth: Foster new industrial ecosystems and create high-quality jobs.
• Enhanced Social Equity: Contribute to building an inclusive society where everyone benefits from technological progress, leaving no one behind.
7. Next Steps
Based on this concept note, we intend to engage in in-depth discussions with potential Limited Partners (LPs), technology and social impact experts, and partner institutions to refine the fund's structure, operational strategy, and investment process. We will also begin building an initial pipeline of potential investments.
Contact: Hyoungjin Kim, hjkim@capstitch.net
