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Capital doesn’t easily flow to where it’s most needed, as the failed negotiations at last week’s COP16 biodiversity summit in Cali, Colombia put in stark relief (see, “Breaking down barriers to addressing the climate crisis“). To chart new channels of climate finance, this month’s Liist of impact funds that are open for investment features managers that are blending public, private, philanthropic and even corporate capital to shift risk perceptions and redirect capital to under-tapped climate opportunities.
“The issue is not a lack of solutions but their distribution,” says Luca Torre of Gawa Capital. The Spanish impact fund manager is in the market with a planned $300 million fund to support climate adaptation in rural communities in Latin America.
The Kuali Fund builds off of Gawa’s Huruma Fund, a blended finance fund for rural and agricultural livelihoods. Kuali is leveraging first-loss capital from the Green Climate Fund and subordinated debt from the Spanish government to encourage commercial investors to back financial and tech products that improve climate resilience for people in vulnerable, hard to reach places.
Cerulean Ventures is leveraging philanthropic funding to support early stage tech founders working to protect nature and biodiversity through carbon removal, renewable energy credits, blockchain applications and sustainable supply chains. The California-based investment firm in September hit its $10 million target but has kept the fund open for additional investments.
Wellers Impact in the UK is leveraging philanthropic funding from food and beverage corporations for its Water Unite fund to derisk startups focused on water technology, conservation and access in emerging markets.
“How do you invest in water and make money?” Wellers’s Neil Sandy said in an interview with ImpactAlpha. “No one’s ever cracked the nut.”
Also on this month’s Liist, Confluence Investors is raising for an open-ended fund it launched in early 2023 to invest in publicly listed companies in emerging markets that are supporting climate action, financial inclusion, education access and quality healthcare. The fund is linking a quarter of its take of profits to its ability to reach specified impact and ESG targets.
Netherlands-based SevenGen is aiming to raise 150 million for a growth-equity climate tech fund that will back companies in Northern Europe. Like Gawa’s Kuali Fund, it’s a designated “deep green” Article 9 fund under the Sustainable Finance Disclosure Regulations.
On this month’s Liist:
- Cerulean Ventures fund I
- Confluence Investors’ Impact Fund
- Gawa Capital’s Kuali Fund
- SevenGen Growth Fund
- Wellers Impact’s Water Unite Impact fund
Check out ImpactAlpha’s database of more than 150 impact funds that have been featured on The Liist.
Disclaimer: The Liist and this post are based on available information, sourced by ImpactAlpha. Information has not been further reviewed by the managers nor verified by third parties, is not guaranteed for accuracy or completeness, and should not be relied upon as investment advice or recommendations. Nothing in The Liist, this post or on ImpactAlpha.com shall constitute an offer to sell or the solicitation of an offer to buy securities.
Cerulean Ventures fund I
Santa Barbara, Calif.-based Cerulean Ventures backs early stage climate ventures addressing “two of the hardest problems in climate,” says co-founder Matthew Stotts: greenwashing, and building businesses that don’t rely on a “green premium.”Its focus is climate fintech, blockchain networks and digital infrastructure helping overcome barriers to a sustainable economy.
“Typical climate VCs invest in market segmentation to carve out a small niche where consumers or industry will pay for what would be unprofitable for the mass consumer or commodities markets,” Stotts told ImpactAlpha. “These investors default to treating climate like one of hundreds of investment niches where they can make money but may never really make change.”
The firm also has an eye to emerging and underserved markets; the founders believe most climate solutions attracting VC funding cater to wealthier individuals in developed markets in the Global North.
Cerulean Ventures in September reached the $10 million funding target for its first fund with backing from the family office of Will Peterffy, One Small Planet. The firm is keeping the fund open to take in additional investors.
- Type of investments: Pre-seed equity
- Fund structure: Traditional closed-ended VC fund
- Where fund is domiciled: British Virgin Islands
- Geographic focus: Global
- Commitments/investors: $10 million; backers include One Small Planet
- Who is eligible to invest: Accredited investors
- Unique fund features: Cerulean operates a “fee and carry-free sidecar” fund that allows founders and advisors to co-invest alongside the firm, without management fees or profit-sharing obligations.
- Sample investments: More than 30 investments made including carbon removal company, Earthbanc in Sweden. Regen Network in the US is building a blockchain system for land and natural resources protection for Indigenous and local communities.
- Sample impact metrics: Minimizing extraction and degradation of nature, climate and economic impacts on indigenous peoples and local communities, equitable access to renewable energy
- Get in touch by email
Confluence Investors’ Impact Fund
London-based Confluence Investors is in the market with an open-ended fund that invests in publicly listed companies in Africa and Southeast Asia. Confluence focuses on listings in non-BRIC (Brazil, Russia, India, China) markets with a goal of bringing more capital to impactful companies that otherwise lack access to adequate public market capital.
Confluence Impact Fund, which launched in early 2023, has raised several million dollars from
Capital Works, a South African multi-strategy group, South African family office Satya, Danish family office Holte, and the founding team. The firm hopes to ultimately raise and deploy $100 million through the fund.
- Type of investments: Listed equities and government debt
- Fund structure: Open-ended fund with quarterly valuation / entry and exit points
- Where fund is domiciled: Guernsey
- Who is eligible to invest: Accredited investors making a minimum investment amount of $100,000
- Unique fund features: Alignment with SFDR Article 9 standards. 25% of the management team’s profits are tied to specified impact and ESG goals that are evaluated by a third-party auditor. If the targets aren’t met, half goes back to investors and the other half is donated to charity. The fund is allocating 10% of its management fees to Impactworks, which collects ESG data on listed but overlooked African companies.
- Sample investments: 13 investments made. CIRA in Egypt educates refugee children with affordable tuition of $250 per child per year. Integrated Diagnostic Holdings, also in Egypt, provides medical diagnostic services. Kenya-based Safaricom is a major telecommunications firm and runs the M-Pesa mobile money service.
- Fund leadership: Diverse-led
- Contact information: Dalia Cohen, Matthew Hodgkinson
Gawa Capital’s Kuali Fund
Spanish impact investment firm Gawa Capital has built a reputation for blending capital from public, private and philanthropic institutions to invest in hard to reach communities. Its Huruma Fund has been investing for five years in livelihood resilience rural agricultural communities across Latin America, Asia and Africa. Gawa is building on its experience with its Kuali Fund, which will invest in rural climate adaptation and resilience in Latin America.
“Adaptation must be where we focus more of our efforts,” Luca Torre of Gawa Capital told ImpactAlpha. “The issue is not lack of solutions, it’s how solutions are distributed.”
It will provide debt and equity to companies with green finance products for households and small businesses, as well as tech ventures delivering clean energy and other solutions.
Gawa is looking to raise $300 million. It has inked first-loss capital from the Green Climate Fund and concessional debt from the Spanish government in an effort to attract institutional investors.
Gawa expects to reach a first close of at least $120 million by the end of the month.
- Type of investments: Equity and debt
- Where fund is domiciled: Luxembourg
- Geographic focus: Latin America and the Caribbean
- Commitments/investors: Green Climate Fund (commitment of up to $27.4 million in equity and $8.5 in grants); Spanish government (concessional debt); undisclosed institutional investors
- Unique fund features: SFDR Article 9; impact-linked compensation; side-car technical assistance funding to support investees’ capacity building
- Get in touch by email
SevenGen Growth Fund
Amsterdam-based SevenGen Investment Partners makes growth equity investments in sustainability tech ventures in Northern Europe. The firm says it’s on a mission to “make impact mainstream” by investing in startups that are helping companies integrate sustainability into everyday business practices. It will write checks of up to €30 million.
The firm, which launched in 2015, is looking to raise €150 million for the fund. The fund has SFDR Article 9 designation and ties the management team’s impact carry to achieving specified impact targets.
- Type of investments: Equity
- Fund structure: Co-operative association with exclusion of liability
- Where fund is domiciled: The Netherlands
- Geographic focus: Northern Europe
- Commitments/Investors: €70 million
- Unique fund features: SFDR Article 9; impact-linked compensation
- Who is eligible to invest: Investors making a minimum investment of €1 million
- Contact information: Frederik Deutman
Wellers Impact Water Unite Impact fund
London and Nairobi-based Wellers Impact was started in 2016 to invest in water access, treatment and conservation, as well as real estate, in emerging markets. It is in the market for its planned $60 million Water Unite Impact fund, which was launched in collaboration with UK NGO Water Unite.
Water Unite Impact is addressing the water funding gap that isn’t met by charity or formal investors in the Global South. It invests in small and mid-sized businesses that focus on water access and preservation, sanitation, plastic recycling, wastewater and solid waste circularity. It has so far backed five companies.
The fund has set up a unique structure to leverage corporate philanthropic capital from food and beverage companies for a first-loss tranche.
- Type of investments: Debt, equity, quasi-equity and tickets ranging between $500,000 and $3 million
- Fund structure: Traditional LP/GP
- Where fund is domiciled: United Kingdom
- Geographic focus: Africa, Asia
- Commitments/investors: $18.2 million from the Water Unite Foundation, the US International Development Finance Corp., The One Foundation, Stanton Hoyle family office
- Who is eligible to invest: Development finance institutions, family offices, high net worth individuals, fund of funds, foundations and corporates
- Sample investments: Jibu in Uganda operates over 200 water production centers that serve over 10,000 water kiosks across East Africa. Seabex in Tunisia uses AI to offer precision irrigation services. Mr Green Africa in Kenya supports plastics recycling.
- Sample impact metrics: Number of people served, number of liters of water produced, amount of fecal sludge managed, tons of organic pollution removed from wastewater, amount of water saved
- Contact information: Louis Goring-Morris
