Venture capital firm Climate Tech Partners is on a mission to accelerate climate solutions by backing innovative high-impact startups across energy, transport and industrials.
Founded by Tom Kline and Patrick Sieb on the belief that investing in climate solutions represents the “greatest investment opportunity of our time,” Climate Tech Partners’ debut fund has secured a cornerstone investment from the Besen family office and is on track to hit a $45 million first close at the month’s end.
As previous Co-heads of Climate Tech Investible, Kline and Sieb structured and raised the Investible Climate Tech fund, which focused on seed stage startups across all climate sectors, before setting up Climate Tech Partners in Sydney around one year ago.
The pair have unique experience at the intersection of deep technology, energy, infrastructure and industry needed in climate tech. By leveraging their extensive corporate partnerships, Climate Tech Partners identify and invest in high-impact ventures that address critical industry needs while helping deliver strong returns.
“When investing in climate and climate solutions there’s no need to sacrifice returns to have positive climate outcomes,” said Kline. “Long-term tailwinds are really going to drive our performance — the correlation between financial outcomes and positive impacts is really strong in the climate space.”
Flipping the VC model on its head
At its core, Climate Tech Partners is a VC investing in climate solutions companies with a unique industry partnership strategy to de-risk investments.
The Fund is focused on investments in Series A companies delivering software, hardware and deeptech climate solutions across energy and power, transport and logistics, and industrials including mining.
“Not only is [energy, transport and industry] the source of a significant amount of emissions, but the solutions across those industries — about how they’re going to decarbonise — are quite intertwined, which is an enormous opportunity,” said Kline.
Sieb added, “These are also sectors in which Tom and I have very strong backgrounds. We have corporate relationships and understand the space well.”
Sitting – Noga Edelstein (IC), Topaz Conway (IC Chair)
The Fund’s unique model seeks to bridge the gap between emerging technology companies and corporate climate ambitions. Instead of the typical model of taking a start up and making sure there is interest in it, Climate Tech Partners start with a problem, they then find the solution and make sure it fits the problem. This makes for a more demand-led de-risked investment that is “super valuable” for the startups because they know they’ll likely be brought a customer.
“We really work with our corporate partners to find out what are their biggest decarbonisation pain points, to help identify areas that we want to actively look for climate solutions,” Sieb said.
“Those corporate partners then assist us in doing diligence on those companies, with the goal that they then can run pilots, become customers.”
“We can not only de-risk investing by picking the best start-ups, but we can accelerate their growth by connecting them to people in corporates who can get a contract written or a pilot done. The model helps to drive growth and value for investors and gets climate solutions into the world faster.”
Cornerstone investors secured
Climate Tech has already announced BESEN, the family office of billionaire Daniel Besen, as a cornerstone investor in the Fund.
“Climate Tech Partners is built on the idea that the best way to de-risk venture investment in climate tech is to align with the needs of industry,” Kline said. “BESEN recognised the strength of this model, and we’re thrilled to have them as an anchor investor.”
BESEN CEO Duncan Murray said, “After an extensive two-year search and meeting with over 30 climate tech managers, we chose Climate Tech Partners.
“In my view, their deep industry experience, combined with an innovative corporate partnership model, made them stand out as the clear leader that we are excited to partner with and support, leveraging our PE experience.”
In addition to BESEN, Climate Tech Partners say they have secured a second cornerstone from an as yet unnamed institution.
Climate Tech expects to make its first investment in the coming months and will look to make 15 to 20 investments, working with its corporate partners to decide which areas to really dive into and where are the greatest growth opportunities.
Decade defining thematics
Providing some insight into the capitalising environment Kline said, “last year was not the easiest, but we’ve really seen momentum pick up. We’ve seen a real momentum shift his year.
“I think people have looked through the noise of what’s been going on, particularly in the US — looked through political cycles. Fundamentally decarbonisation is not going away; people are recognising that decarbonisation and AI will drive the next decade or two of investment opportunities.”
Besen CEO Duncan Murray echoed that view saying, “Just as the internet and mobile communications were the two big tectonic investment plates that have emerged this century, AI and the energy transition are likely to be the two that will define the coming decade, and Tom and Patrick are exceptional in the latter.”
Kline added, “We’ve seen people who have been sitting on the sidelines for some time now really coming back in. A number of the families we were talking to through last year have come back this year and are ready to start writing cheques, which is fantastic.
“We will close on 30 April, above $45 million, and are really happy with the momentum that we have at the moment.”
Climate Tech Partners Fund I
Climate Tech Partners Fund I matches early-stage decarbonisation technology players with large corporates’ specific decarbonisation needs to de-risk its investments.
The VC firm is looking to raise a Fund for final close targeting around $75 million. It is expected that will come from a combination of about a third family office money, a third institutional and then a third of the money from corporate partners.
The Fund is now nearing its first close, targeting April 30, with commitments in excess of its initial target.
Wholesale investors can register their interest in the Climate Tech Partners Fund I here: https://climatetech.partners/investment/
For climate tech companies looking to scale, Climate Tech Partners can help accelerate growth and impact, offering capital, access to corporate partners and strategic advice. The fund is primarily looking to invest in Series A climate tech startups but would also like to hear from seed stage companies.
For more see: https://climatetech.partners/startups/
For its corporate partners, Climate Tech Partners offers direct access to the best global innovative technologies that align with the corporate partner’s climate goals, from progressing decarbonisation goals to creating business opportunities. Corporates can choose to invest through Climate Tech Partners or just actively engage in supporting startups without committing capital.
For more see: https://climatetech.partners/corporate-partnerships/