PitchBookPitchBook Data,Inc.John Gabbert Founder,CEOEmerging SustainableNizar Tarhuni Vice President,InstitutionalResearch and EditorialInvesting Opportunities:Daniel Cook,CFA Head of Quantitative ResearchTransit TechInstitutional Research GroupHow transit tech can create a double bottomAnalysisline of financial returns and positive social andenvironmental impactAnalyst,Fund StrategiesSusta ina ble Investinganikka.villegas@pitchbook.comPitchBook is a Morningstar company providing the most comprehensive,mostaccurate,and hard-to-find data for professionals doing business in the private markets.Insights developed in collaboration withJonathan Geurkink,Sr.Analyst,EmergingTechnology at PitchBook Data.DataKey takeawaysAlyssa WilliamsSenior Data AnalystIn an effort to boost public transit ridership numbers,governments arepbinstitutiona lresearch@pitchbook.comincreasingly turning to transit tech to help improve both access to and theexperience of mass transportation.PublishingThe financial return potential of this opportunity is underpinned by a growingDesigned by Chloe Ladwigend-user base,government support in the form of partnerships and regulatorycooperation,and user stickiness.Transit tech has the potential to create positive environmental impacts in the areasContentsof climate change and pollution mitigation and ecosystem harm prevention,as wellas social impacts in terms of human health and economic mobility.Key takeawaysIntroduction2Financial return potential3Environmental and social impact5potentialPitchBookEmerging Sustainable Investing Opportunities:Transit TechIntroductionVenture capital,often serving as the incubator of emerging technologies,is well-positioned to invest with positive social and environmental impact goals in mind.Venture capitalists can utilize their expertise and resources to foster the businessesthat have the greatest potential for both impact and returns,especially whenkeeping an eye to companies for which success necessarily marries the two.Thisfact has not gone unnoticed by venture capitalists,which comprise 42.7%of thetotal count of impact funds raised since 2007.Yet,the landscape of prospectiveopportunities is expansive and rapidly evolving,making it difficult to keep track ofwhich have the greatest financial-and impact-return potential.Emerging opportunities often go beyond the investment areas traditionallyassociated with sustainability,such as solar energy or electric vehicles,encompassing a host of lesser-known technologies.Even within the familiarthemes,there are niche investment opportunities developing.In this analyst noteseries,we surface opportunities across emerging technology verticals such asfoodtech,mobility tech,and carbon emissions tech that we believe are poised toperform well within the next decade,from both a financial-return and an impact-return perspective.In doing so,we hope to help guide venture capitalists pursuingthe "double bottom line"through the complex landscape to the most fruitfulopportunitiesFor each analyst note in the series,insights are developed in collaboration witha PitchBook Emerging Technology Analyst covering the relevant vertical,usingtheir subject matter expertise and previous research,as well as some externalresources,to inform our perspective on the space.We discuss the return potentialof the opportunity and its major drivers,as well as the investment risks andobstacles it faces.We also explore its social and environmental impact potential,how the opportunity fits into various IRIS+Impact themes,2 and potential metricsto help quantify those impacts.Ultimately,the aim of this research is to giveventure capitalists and their LPs a better understanding of how the opportunitiesalign to their return and sustainability goals and provide companies operatingin these spaces a sense of how to optimize and communicate their social andenvironmental impact.This analyst note focuses on transit tech,which encompasses digital dispatch appsand digital planning,scheduling,and route optimization software,as well as othertech-enabled solutions created to help address public transportation challenges.3Mass transit,in the form of buses,light rails,subways,and ferries,among others,is not a new phenomenon.However,as consumer preferences have shifted towardsingle-occupancy vehicles in many metropolitan areas-particularly in the US-public transit agencies and operators have sought to improve ridership through newtechnologies.Since 2013,61 VC-backed companies have entered the transit techspace,with $5.3 billion in investment.2