The investor state
By Chris Shahabi
For decades, America’s innovation story has been told through a familiar lens, the daring entrepreneur, the visionary venture capitalist, and the miracle of the free market. But when it comes to clean technology and climate health, this Silicon Valley model is no longer enough. Mariana Mazzucato’s concept of the Entrepreneurial State offers a powerful and necessary alternative, one that places public purpose, not private profit, at the center of innovation.
1. The State as the True Entrepreneur
Mazzucato’s central argument is that the U.S. government has always been the real risk-taker behind technological revolutions. From the Internet to GPS, public funds laid the groundwork for industries that private firms later commercialized. In the clean-tech sector, this dynamic is even more critical. The energy transition demands massive upfront investment, uncertain returns, and long time horizons, conditions that venture capital simply won’t tolerate.
Private investors look for rapid exits, not decade-long R&D projects. Yet the kind of innovation required to decarbonize the planet, next-generation batteries, smart materials, carbon-negative concrete, or advanced air purification systems, doesn’t follow the “build fast, sell faster” playbook. It needs public institutions willing to absorb early risk, nurture the science, and sustain development until the technology is commercially viable.
The Entrepreneurial State doesn’t just fix markets when they fail; it creates entirely new markets, just as it did for renewable energy, electric vehicles, and even semiconductor manufacturing.
2. Silicon Valley’s Short-Termism is a Climate Liability
The Silicon Valley innovation model, while celebrated for its dynamism, thrives on speed, hype, and capital turnover. It’s built to scale apps, not to solve systemic problems like carbon emissions, air quality, or ecosystem collapse.
Clean-tech companies that chase this model often burn out quickly. They struggle to attract sustained capital once early subsidies dry up or when breakthroughs take longer than expected. The result is a cycle of boom, bust, and abandonment, leaving behind half-developed technologies and wasted public resources.
Climate innovation, by contrast, demands deep science, interdisciplinary research, and patience, the kind of work that benefits from long-term public missions rather than quarterly investor expectations. If clean-tech follows the Silicon Valley model, it risks turning into another speculative bubble rather than a foundation for genuine climate recovery.
3. Health and Climate Are Interlinked, and Public Goods
At its core, climate innovation is about human health. Poor air quality, rising heat levels, and degraded ecosystems directly impact respiratory, immune, and cognitive functions. Technologies that clean air, restore balance to urban environments, and reduce chemical exposure aren’t luxury goods, they’re public health imperatives.
Yet markets consistently undervalue health and ecological stability because their benefits are collective, not individual. This is why Mazzucato’s framework matters: she argues that the state must take responsibility for mission-oriented innovation, setting bold goals, like “carbon-negative cities by 2040,” and aligning both public and private actors toward achieving them.
In this model, clean-tech becomes part of a national health and security strategy, not just an investment category. Every innovation is judged not just by profit potential, but by its contribution to air quality, human longevity, and ecological resilience.
4. Sharing the Rewards of Public Risk
One of Mazzucato’s most pointed critiques of American capitalism is that it socializes risk and privatizes reward. Taxpayers fund the breakthroughs; corporations collect the profits. In clean-tech, this imbalance is especially damaging.
If public funds are used to seed green hydrogen or bio-based materials, the returns should not disappear into private hands. Instead, governments can create mechanisms to retain equity stakes, reinvest royalties into future missions, or establish public wealth funds tied to sustainability outcomes.
This way, as clean-tech industries grow, so does society’s collective capacity to reinvest in new climate solutions, ensuring that prosperity cycles back into the system that created it.
5. Building a Mission-Oriented Future
A mission-oriented approach means reimagining how we measure success. Instead of counting unicorn startups or venture exits, success is measured by how much cleaner our air becomes, how much carbon we capture, and how many people breathe easier.
This is the kind of entrepreneurial vision the state must lead, one where innovation serves life itself. It’s about aligning technology with purpose, not speculation; about long-term planetary health over short-term gains.
Clean-tech entrepreneurs and governments alike should take a page from Mazzucato’s playbook: work together to design markets around human well-being, not just financial return. That’s how true climate resilience and economic renewal begins.
In short, the future of clean-tech innovation will not be written in Silicon Valley boardrooms but through public-purpose partnerships driven by mission, courage, and vision. The entrepreneurial state, far from being a bureaucratic relic, is our best hope for a clean, healthy, and equitable planet.
