World Fund closes first €300M climate tech fund, seeking to follow on and back hardware
Reading Time: 2 minutesAfter a three-year fund-raise, World Fund has finally closed a €300 million first fund, €50 million short of it’s target in 2021, but still a considerable number given a background of war and economic uncertainty. The VC originally emerged from the founders of the Ecosia independent search engine, where search enquiries funded the planting of trees.
If you’re looking for comparisons, Norrsken VC is a $130 million impact VC that covers climate, while Demeter Partners last raised a €250 million fund focused on climate.
World Fund will be backed by the European Investment Fund (which put in €50 million), KfW Capital, Wachstumsfonds, Bpifrance (the fund’s first investment outside of France), PwC Germany, NRW.BANK and Ignitis Group. World Fund is also backed by pension funds including the U.K. Environment Agency Pension Fund, Wiltshire Pension Fund and Croatia’s Erste Plavi.
World Fund has already deployed some of its cash into a number of climate tech companies, but it says this capital will enable it to make 25-30 investments into European startups around decarbonization.
Its most notable investments include IQM Quantum Computers, Space Forge, Planet A Foods, Juicy Marbles, ENOUGH, CustomCells, recycling company Cylib, and proptech startups aedifion and Ecoworks.
World Fund has completed its raise during a war in Europe, interest rate rises and jittery LPs. Fund managing partner Danijel Višević said: ‘It was a super hard fundraising environment, especially in 2023.’
‘We only invest in decarbonization technologies, and we reserve more than two-thirds of our capital for follow-on investments because in Europe it’s hard to bridge the later-stage gap,’ he added.
He said hardware had to be an important component of its strategy: ‘This is one thing we are doing wrong in Europe, not concentrating on hardware for climate.’ He added that the fund has invested in technical talent like biotech and biochemists to assess investments.
World Fund’s raise comes at an opportune moment.
In 2023 there was over $20 billion raised by European climate tech startups, almost matching the previous year, and bucking declining trends in other sectors, according to Dealroom.
The U.K., Sweden and Germany led for total climate tech VC in 2023, but Iceland, Lithuania and Bulgaria showed notable growth.
And climate tech is faring well in Europe.
Valuations are maintaining value and European energy-related patents are up 15% YoY.
The Berlin-based World Fund was founded in 2021 by Daria Saharova, Višević, Tim Schumacher and Craig Douglas. It has offices in Berlin, Munich, Cologne and Amsterdam.
Reference: https://techcrunch.com/2024/03/21/worldfund/
Ref: techcrunch
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