Algebris Launches Climatech Fund for Green Tech Startups

Algebris Investments, a global asset management firm, has launched its new venture, Algebris Climatech, a fund focused on investing in climate and deep tech startups operating in the energy, materials, industrials, and food sectors. The initiative is a significant milestone for Algebris, as Climatech is the firm's first venture capital fund, marking its commitment to fostering sustainable and transformative solutions for a greener future.

The launch of Algebris Climatech follows a successful debut from the firm in its private equity fund, called Algebris Green Transition. This focuses on sustainable transformation investments. Algebris Green Transition generated huge interest and ended up raising €380 million in commitments by the final close in September 2024. The two funds are managed under Algebris' green transition-focused unit, based in Milan and launched in 2021. This unit has emerged rapidly as one of the important vehicles in promoting Italy's, as well as Europe's, greater transition toward sustainable and environmentally oriented solutions.

The fund has committed around €60 million in first close of Algebris Climatech, based on strong first-round support. The firm will target raising around €100 million for the total fund. It is worth highlighting that CDP Venture Capital - through its Technology Transfer Fund and Green Transition Fund-PNRR - is acting as a corner stone investor. The funds drawn from assets created under the framework of NextGenerationEU, led by the European Union, support innovativeness, sustainability, thereby fitting squarely with what Algebris Climatech envisions for.

The Article 9 fund placed under the scope of SFDR of the EU, Algebris Climatech represents the culmination of a chain of commitments of the highest kind to sustainable investments. The fund plans to develop a focused portfolio of 15 to 20 companies, targeting startups with robust growth potential and the ability to establish themselves as category leaders in their respective industries. In its selection process, the fund will prioritize promising projects sourced from university research and other innovative hubs. Once onboarded, portfolio companies will be given the support needed to transition from development stages to market expansion, thereby driving meaningful impact within their sectors.

A seasoned team led by Marco Turchini, Investment Director at Algebris, along with Managing Partner Alessandro Santo and Partner Stefano Ferrari, will oversee the management of Algebris Climatech. The leadership trio is experienced in venture capital, sustainable investments, and growth in small and mid-sized businesses.

Commenting on the launch, Turchini said: "We are proud to launch the first venture capital initiative of Algebris Investments. We believe that Algebris Climatech is uniquely positioned to seize remarkable opportunities in Europe's climate and deep tech sectors, thanks to our extensive experience and synergies within the wider Algebris group. Algebris prides itself on investing in strategies in the Italian mid-caps space as well as the green transition.

Turchini also pointed to the bigger vision for the fund, emphasizing how it can contribute to the success of its portfolio companies but also contribute to the growth of Italy's small business sector. He said, "Our goal is to build an international venture capital platform, which is founder friendly and supportive of Italy's small business growth.

This focus on Italy and its role in green transition aligns with Algebris broader strategy. The firm has always sought to leverage its expertise and network to drive meaningful change within the Italian market while extending its impact on a global scale.

The creation of Algebris Climatech is a manifestation of the increasingly important role played by venture capital in the facilitation of sustainability and innovation. It is during a time when the world focuses increasingly on climate change and technological advance in policy and business strategies, that funds such as Climatech are needed in order to ensure that innovative, groundbreaking research leads to practical solutions that can scale.

Additionally, the investment qualifies as Article 9 investment and, as such, satisfies very strict ESG standards, with all the commitments for the sustainability that comes along with it. By focusing on sectors such as energy, materials, industrials, and food, Algebris Climatech addresses some of the most pressing challenges of our time, such as decarbonization, resource efficiency, and transition to more sustainable food systems.

The partnership with CDP Venture Capital also speaks well to the cooperative nature of this initiative. Using resources and skills from both public and private sources, the fund will look forward to amplifying impacts and creating change in a very systemic manner. The assets within NextGenerationEU further fortify its base to provide strong financial support for innovating projects according to the EU's green and digital priorities.

As Algebris Climatech sets off on its journey, it is taking with it the potential to alter the European landscape in climate and deep tech innovation. The fund itself not only positions itself as a critical actor in green transition but also shows the example of how venture capital can be placed at work to create that sustainable future by focusing on high growth startups that have the capacity to lead in their fields.

With its great take-off and audacious vision, Algebris Climatech is an effort to bring about a change by pushing ahead the plight of the fight against climate change while supporting the growth of the next generation of innovators and entrepreneurs.