Virescent Ventures surpasses $260m portfolio, eyes $200m Fund II

VC Virescent Ventures has announced a remarkable milestone, with its specialized portfolio now exceeding $260 million.

The Australian climate tech VC, manages a portfolio exceeding $260 million, supporting 33 innovative climate tech businesses. Established in 2022 by the Clean Energy Finance Corporation (CEFC), Virescent Ventures plans to raise a new fund (Fund II) of approximately $200 million, aiming to further catalyse private sector investment in Australian climate tech. Fund II’s goal is to deploy $200 million or more over the next five years across key thematics, such as clean energy transition, food and agriculture, circular economy, and mobility.

Virescent Ventures’ focus has been on Series A or seed stages (with just a few late stage investments). The Virescent Ventures active investment philosophy can add significant value to founders and teams by helping them grow and scale their solutions.

As of January 23, 2024, Virescent Ventures’ managed CEFC portfolio is allocated to these thematics:

Clean energy transition: ~$115 million (44%)

Food and agriculture: ~$28 million (11%)

Circular economy and industry: ~$53 million (20%)

Mobility and smart cities: ~$48 million (18%)

Remaining 7% allocated to specialist seed funds and incubators ($18 million).

The portfolio spans various sectors, technologies, and processes addressing global climate transition challenges. Recent investments include $2.6 million in battery recycling startup Renewable Metals. Virescent Ventures focuses on Series A or seed stages and believes the Australian climate tech industry offers attractive returns.

Kristin Vaughan, Managing Partner of Virescent Ventures, said: “Ben Gust, Blair Pritchard, and I are very proud to have built such a robust and high-performing portfolio after actively investing in climate tech together as Partners for almost six years.

“We are also proud of our heritage with the CEFC and appreciative of the continued support and investment from one of the world’s largest ‘green banks’. It has played an important role in advocating for, and catalysing investment into, climate transition and decarbonisation solutions. Our combined depth of experience and talent in climate tech, combined with the 140+ experts within the CEFC, is an important and unique advantage.

“We are also particularly excited to work towards doubling the size of this portfolio with the support of additional local and global institutional and private investors into our upcoming Fund II. The valuations within our current portfolio remain resilient, with portfolio companies continuing to grow and outperform through difficult market conditions. This validates our investment strategy and belief that climate tech VC is a commercially attractive alternative investment.”

The CEFC has a minority shareholding in Virescent, with CEO Ian Learmonth leading as non-executive director and Investment Committee member. 

CEFC CEO Ian Learmonth said: “The climate tech sector has enormous potential to accelerate the transition to net zero. With no single solution to the complex challenge of economy-wide decarbonisation, the diverse range of sectors covered by CEFC climate tech investments will be critical in our race to net zero. Homegrown innovators can also help Australia capitalise on the sustainable economy of the future.

“The Virescent Ventures team has an outstanding track record developing and managing an exciting portfolio of climate tech companies. We look forward to continuing to work with them as they pursue their first close and bring much-needed capital and expertise to the sector.” 

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