TEA Types: Why your Technoecomomic Assessment Should Scale With You
A solid Technoeconomic Assessment (TEA) is a must-have tool for fundraising and scaling any new technology (check out our blog post on TEAs for lean startups). When designed and utilized correctly, a TEA not only informs key business and technical decisions but also reveals the true economic potential of a technology at scale.
Recognizing the importance of a TEA is just the beginning— knowing how to move forward can be daunting, and with countless TEA resources available, it’s easy to feel overwhelmed. However, with the right approach, you can transform back-of-the-envelope estimates into robust, data-driven models that provide clarity, mitigate risk, and drive better business decisions.
What type of TEA do I need at this point in my scaling journey?
We’ve assisted numerous clients in scaling their technology through our TEA services, contributing to over $200 million in successful fundraising. Through our work with companies across various stages of development and funding, we have found that the real question is rarely as simple as “Do I need a TEA: yes or no?” but rather a more nuanced question of, “What type of TEA do I need at this point in my scaling journey?” Understanding what approach is right for you can make all the difference in unlocking new opportunities and accelerating strategic growth.
In this article, we’ll break down the different types of TEAs, explaining when and how they’re best used at different stages of development, along with our insights on how the size of investment and potential returns may vary for each type. Be sure to check out the Next Rung TEA Decision Buddy at the end of this article to help you determine which TEA is the best fit for your company’s current stage.
Define Your Goals
TEAs can serve different purposes depending on what you are trying to achieve. The most common function of a TEA is to facilitate a fundraise, as investors are driven to know the details of the economics behind your process. However, TEAs are also crucial for supporting R&D and helping you to focus your research efforts in a direction that will yield profitable results. Additionally, our TEAs in particular also contain most of the components of an initial plant design package (FEL 0/1), and can support you with making strategic makes vs. buy decisions.
Another aspect to consider is output format, who is the target audience of your TEA and what functionality do they need to access in order to engage with it effectively? Next Rung always does our TEAs in Excel, because it is an accessible tool that can be used effectively by a wide variety of stakeholders across the technical, advisory and funding teams.
Breaking Down TEA Types
Below is our high-level assessment of the different types of TEAs that one can pursue, along with a summary comparison chart that highlights the points we make about each type below.
Now we will go into detail for each type, including target funding and TRL stage, and what level of investment return you are seeking.
1. Self-Guided TEA
An internal TEA is an excellent first step toward understanding your project's economics. At this stage, you can leverage publicly available templates (include link here to most popular like NREL? "such as these provided by NREL") or use modeling software to input your process data.
These approaches are typically quick to implement and can provide valuable insights into economic feasibility, making them ideal for emerging ventures or proof-of-concept projects. By starting with an internal TEA, you can identify potential opportunities and risks before committing to more detailed third-party analyses. These TEAs can later be reviewed by a 3rd-party expert in order to ensure credibility.
Next Rung Role: Advise, Review
Next Rung Offering Associated with this Type: TEA Review and Strategic Roadmap Package
2. Early-Stage TEA
As your company progresses through the R&D process or engages in conversations with investors, you may find that a more detailed model is needed—one that better reflects your unique technology and provides greater flexibility than standard templates or off-the-shelf modeling software. At this stage, your company may choose to develop your own TEA, either internally or in collaboration with a third-party practitioner.
TEAs at this stage should more closely align with your process design and thus capture key operating and capital expenses with a higher degree of accuracy. Taking your TEA to this next level of customization can enhance your model’s reliability and boost credibility with funders.
Next Rung Role: Review, Verify, User Model Updates
Next Rung Offering Associated with this Type: Process Design Review & Consulting
3. Full-Process Model TEA
As your company moves toward building a pilot or commercial-scale plant, having a deep understanding of your unit economics and the key process parameters that drive profitability becomes essential. Just as crucial is your ability to clearly communicate these insights to both technical audiences and investors.
At this stage, a more advanced TEA is needed— one that goes beyond basic cost estimation to integrate process engineering, plant design, and financial modeling into what we call a full-process model. These models should be highly dynamic, allowing you to adjust key parameters to see their impact on economic outcomes in real time. A well-designed full-process model features an intuitive interface, making it easy to convey complex results with clarity.
A full-process model is built upon real engineering and design expertise, incorporating detailed material balances, real equipment cost estimates, and accurate utility usage calculations. The process of developing such a model often proves as valuable as the model itself, uncovering and addressing gaps that exist in the process design. Investors recognize this level of diligence, which adds credibility and grants higher confidence in your projections.
Next Rung Role: Generate
Next Rung Offering Associated with this Type: TEA integrated with FEL 0/1 Design, achieving initial design of your first/next plant whether it be Pilot, Demo or Commercial.
4. Green TEA
If sustainability is at the core of your technology, integrating elements of environmental analysis into your TEA can offer a strategic advantage. At Next Rung, we call this approach a “Green TEA”—an enhanced full-process model designed to support the gold standard for green investing. A Green TEA not only provides financial projections but also quantifies sustainability outcomes, allowing you to effectively communicate both the economic and environmental benefits of your technology. These models can leverage outputs such as water, electricity, and raw materials usages to support more complex metrics like carbon footprint or cumulative energy demand.
Next Rung Role: Generate
Next Rung Offering Associated with this Type: The Green TEA is a unique integration of economics & sustainability metrics that supports true Green Investing.
This framework is meant to provide some high-level benchmarks to inform your decision-making as you scale. As we know well, every project is unique and budgets vary widely. For instance, we have worked with many pre-seed companies on developing a Full-Process Model TEA because they had the resources and wanted to invest in a tool that could grow with them.
Our core philosophy at Next Rung is that your TEA should be a dynamic tool that scales with you, that takes you where you need to go. We have supported our clients through all the types of TEAs listed out here and beyond, into more complex modeling scenarios. Instead of starting from scratch at each level of scaling, our TEA tool was able to change and be adapted to the needs of each stage of the company.
As you pursue scaling, consider what tools you have in your toolkit, and how they serve you throughout the entire scaling journey, not just the current moment you find yourself in.
What are you scaling? Have more questions about which TEA type is right for you, or can you imagine one not on this list that you want to build? Reach out! We would love to learn more.
