Launching with the mission to instigate positive change in climate change investing, Climate VC has launched today to invest €41 million over the next three years. The fund will take an impact-first investment strategy, looking for net-zero founders that are too often overlooked by traditional VC.
The fund has a forward-thinking strategy, planning to invest in 120 early-stage climate startups over the next 3 years with a strict focus on startups with the highest potential direct impact on carbon emissions and climate change. Climate VC wants to disrupt the traditional VC approach to climate innovation by putting as much emphasis on the climate impact of a venture as the commercial return.
Led by Peet Denny, Simrun Basuita and Andrea Emanuelli, the UK-based fund is made up of a team of AI and advanced technology specialists, operators and founders. The fund’s Advisory Board is also made up of experts in the climate industry – ensuring that long term impact is correctly considered. The Board includes a Greenpeace board director, a senior Google executive and environmental and climate change advisors to the Ministry of Defence.
Peet Denny, founding partner of Climate VC, explained: “Our investment strategy is multi-layered but laser focused in its ambition. We’re backing climate change innovators that might have been overlooked by other investors but whose cutting-edge ventures can be deployed effectively in markets with the greatest potential for impacting emissions. Some will reach impact quickly, some will need a more patient timeline, and though we may put impact first but we’re still investors seeking returns. Start-ups that most excite us are those for whom generating revenue means dramatically reducing carbon from being emitted in their sector. Collectively, every participant in the Climate VC must share a common goal: to accelerate innovation with measurable, direct global impact to help save the planet and improve life for every person living on it.”
The aim is that at least 10 of the investments become full-scale successes, each removing 10 megatonnes of CO2e a year for a decade, cumulatively creating a gigatonne impact on the climate change mission by the mid-2030s.
Initial investments include Global OTEC – founded by Dan Grech – an affordable, clean, baseload power for tropical island nations harnessing the temperature difference between warm surface water and cold deep water at sea to produce electricity. It is also investing in Tierra Foods – founded by Marcela Flores and Angela Newton – which is scaling agroforestry in Latin America, producing sustainable and scalable ingredients while restoring lost rainforest. The team intends to complete 7 to 10 investments per quarter. The fund has a pipeline of planned investments and intends to announce its further investments in April.
Ed Gillespie, a member of Climate VC’s Impact Advisory Board and member of Greenpeace’s board of directors comments: “The climate crisis is the greatest threat mankind has ever faced, but also the greatest opportunity to reshape our civilisation. The world is currently emitting around 50 gigatonnes of CO2e annually*. By investing in some of the most inventive and creative ways the human brain can imagine to reduce that figure by 2% through VC investments – either by removing emissions from the atmosphere or preventing them from being emitted in the first place, Climate VC stands to exert a gigatonne scale impact.”
Operating a rolling fundraising model, Climate VC expects to double the funds raised every quarter, eventually having raised upwards of £35 million (€41 million) by 2025. All companies are EIS eligible and investors will also be offered strategic opportunities for co-investment.
Marta Krupinska, a member of Climate VC’s Impact Advisory Board and a Head of Google for Startups, adds: “The impetus among VC investors to transform what used to be lip service into genuine investment-backed action against climate change is greater than ever. What stands Climate VC apart from other seed investors is their attention to creating true, measurable impact on CO2e alongside commercial upside for investors. Climate VC looks beyond the immediate problem of how to make a venture work and focuses on what the impact would be if that venture were viable. That’s a hugely exciting position to start from at a point in the climate crisis where we need more leaps of faith from committed experts. Reducing global CO2e emissions by one gigatonne won’t reverse climate change on its own. But the impact of doing it with a portfolio of fledgling start-ups will be enormous. What it’s doing should incite and excite others to think similarly and move in the same direction.”