Dealflow | April 5, 2023

Investors target home energy efficiency in Europe

Jessica Pothering
ImpactAlpha Editor

Jessica Pothering

ImpactAlpha, April 5 – European climate tech investing is defying the lull in venture capital dealmaking. The latest: Energy Impact Partners, Fair Capital Partners and Energiiq invested €15 million ($16.4 million) in HeatTransformers, a Dutch startup that sells, installs and services heat pumps in the Netherlands.

The deal follows investments last week in U.K.-based smart water-heater maker Mixergy and Denmark’s Lun, which helps heat-pump installers find customers and complete installations.

Hot for heat pumps

Sales of heat pumps, a clean and energy-saving method of home heating and cooling, jumped nearly 40% in Europe last year, as gas prices spiked with the war in Ukraine. Consumers in the Netherlands last year faced the second-highest energy costs in Europe (costs have since come down).

The Series A financing will help HeatTransformers expand into Germany and the U.K., where residential energy prices are still far above the average in Europe.

Smart thermostats

Separately, S2G Ventures, chipped in an additional €12 million ($13.1 million) for Germany-based Tado, which makes thermostats to improve home energy efficiency. The company raised €43 million in January with S2G’s participation.

The deal underscores Chicago-based venture capital firm’s expanding climate strategy. S2G was once exclusively focused on sustainable food and agriculture investments but has in recent years branched into ocean and energy tech investments.