World Fund, one of Europe’s leading climate tech VC, has closed a €300 million first fund. Notable backing comes from major investors including EIF, KfW Capital, Wachstumsfonds, BPI France, PwC Germany, NRWbank and Ignitis Group. A number of pension funds also joined the fund, including the UK Environment Agency Pension Fund, Wiltshire Pension Fund, and Croatia’s Erste Plavi. World Fund’s first investor Ecosia, Europe’s largest independent search engine, also committed capital.
Closing at this amount means that World Fund has raised the largest ever first-time fund in European climate VC history. This capital will enable the World Fund team to make 25-30 substantial investments into European startups, those building technologies with the potential to decarbonise entire industries.
The Berlin-based VC was founded in 2021 by Daria Saharova, Danijel Višević, Tim Schumacher and Craig Douglas. It has offices in Berlin, Munich, Cologne and Amsterdam, and an investment team with both a scientific and entrepreneurial make-up. World Fund has already backed 15 market-leading companies, including IQM Quantum Computers, Space Forge, Planet A Foods, Juicy Marbles and ENOUGH Foods. Other headline-generating investments include those into battery manufacturer CustomCells, recycling company Cylib, and proptech startups aedifion and ecoworks.
Danijel Višević, Managing Partner at World Fund, said: “We are proud that we have been able to attract numerous institutional investors who haven’t ever invested in VC or a first-time fund before, but did now with us. We will work to ensure that our fund demonstrates to the world that successful investments and positive climate impact go hand-in-hand. In this way, we hope to provide a service to the entire climate investment sector.”
The firm’s milestone first fund demonstrates a continued growth in interest in climate tech from institutional investors and sends a welcome signal to European entrepreneurs. Latest data shows that climate tech valuations have remained relatively resilient in Europe amid a downturn in other sectors since 2021 – and the future looks bright. There is evidence that cutting-edge climate tech research is booming in Europe. For example, European energy-related patents are up 15% YoY, against a backdrop of 43% of all global top R&D patents originating in Europe. The World Fund team will use their fresh funding to seize on this opportunity.
Višević added: “We are on a mission to ensure that the best of European climate techs do not fail due to the dearth of funding beyond the earliest stages – that infamous ‘Series B valley of death’ that has plagued European companies for too long. Our planet is at a pivotal juncture, and we could not be prouder to spend every day working towards creating a regenerative world, backing European founders building world-changing companies. If you’re building something, please contact us – our doors and inboxes are always open.”
The fund has also brought on board a number of LPs who have never previously backed first-time VC funds. This includes the UK Environment Agency Pension Fund, Wiltshire Pension Fund and Erste Plavi, as well as BPI France’s inaugural investment in a first time fund outside of France. World Fund also raised €50 million from the European Investment Fund. This is all despite fundraising in one of the most challenging VC environments in history – with a backdrop of a war in Europe and geopolitical uncertainty, during a period of sharp interest rate rises, the breakdown of the Silicon Valley Bank, and investors reined in new commitments.
Lilian Schwich, Co-Founder and CEO at Cylib, said: “World Fund really understands the mission we are on – the team believes that CAPEX projects are the lever for tackling the climate crisis. Their team is strong and always approachable, and offers us a superior mix of technical experts as well as relevant networks. Since investing in us in early 2023, they have already connected us with political institutions and offered incredible support with ESG expertise, as well as finding synergies within the wider portfolio. We could not recommend World Fund more highly.”
Petar Vlaić, President of the Management Board, Ersteplavi, commented: “We invested in the World Fund because we saw that the Fund’s team members have a strong track record in climate tech investing, and have extensive experience in the industry and a deep network within the European tech ecosystem, which will help in investing in startups with European roots that provide globally applicable solutions in the climate tech sector. Also, the Fund has a strong deal sourcing network, including co-investors, entrepreneurs, corporate partners, and limited partners. We see that the team’s experience and expertise will enable them to add value to portfolio companies through their understanding of the climate tech sector and their ability to help companies scale and succeed.”
World Fund looked to raise climate capital at an unprecedented scale to help European climate tech startups overcome their biggest challenge today: the financing gap at the Series B stage.
In Europe today, climate and deeptech startups in their early growth stage often need €30M+ in funding to scale up and for example build that factory they need to create game-changing products. However, until now that capital has often been unavailable, stifling growth and even leading to brilliant companies collapsing. World Fund managing partner, Danijel Višević, has labeled this situation the ‘Series B valley of death’.
World Fund offers a solution to this problem with this fund, leading financing rounds and reserving significant capital for follow-on investments to help companies in its portfolio overcome this hurdle.
Read the orginal article: https://www.eu-startups.com/2024/03/berlin-based-world-fund-closes-milestone-e300-million-fund-to-institutionalise-climate-capital-in-europe/
