Focus on investors as new list shows 50 most impactful climate VC investors

It is inarguable that most people will be happy if much of what happened in 2020 is not repeated in 2021 but there are exceptions. 2020 was a good year for sustainable investing and 2021 has already continued this trend.

Swedish impact investor, Norrsken Foundation, have scheduled an innovative 8-week impact accelerator supporting startups where investors, entrepreneurs and advisers meet in Stockholm; Budbee, the Swedish-based firm who specialise in green last-mile delivery logistics have raised €52m venture capital; Vivent, the Swiss agricultural technology startup raised funds from an impact fund.

Within the green economy, climate tech – tackling climate change with technologies which will reduce carbon emissions – is a sector whose time really has arrived. Investors have been eager to get involved leading to a five-fold increase in European investment in climate tech over the last five years. A report published by PwC in July revealed that, globally, climate tech investments had grown at five times the rate of the Venture Capital (VC) market over the past seven years.

Not only growing in terms of the number of climate tech firms, the reach of those firms is also expanding and one of the more exciting newcomers is now providing a guide to the investors doing most in the sector. Contrarian Ventures, the Lithuanian early-stage energy transition focused VC fund, is launching Climate 50 - an annual list that aims to recognise the most globally impactful climate VC investors.

Rokas Peciulaitis, founding partner at Contrarian, summarises the timing of the list and its rationale appositely: “The world’s carbon budget is finite [and] running out at an accelerated pace and there is no plan(et) B”.

The ranking is derived from ten metrics: six direct metrics based on the investment activity of the investor (e.g. number of investments in new companies, number of unicorns – companies with a valuation in excess of $1bn – in the portfolio) and four indirect metrics which look at their non-investment activity (e.g. brand awareness, inclusiveness policies). Each metric carries its own weight with the direct metrics comprising 75% of the total investor score.

To build visibility and encourage participation, the Climate 50 will allow the public to vote for the 135 funds chosen by Contrarian and announced on January 15th with these votes providing one of the indirect metrics. Voting is allowed until the end of February. The list is then whittled down to the 50 who will comprise the Climate 50 to be announced in March.

Contrarian hope that the list will not just provide a league table but also define what “a great investor is in the climate [community and] act as a reference point for entrepreneurs”.

Of the 135 companies listed, 40 are European with all but five of the remainder from America. Included among the current top 10 European firms (before the public votes are factored in to the rankings) are BP Ventures and Shell Ventures – indicative of how companies which were once giants of the fossil fuel sector are transitioning.

The other 8 in the top 10 European firms are: Aster, ETF Partners, High-Tech Gründerfonds, Next47, Future Energy Ventures, Norrsken VC, Demeter Partners and Future Positive Capital with the company behind the list, Contrarian Ventures, currently ranked 11th of the European firms.

Currently ranked first overall is the American-based Energy Impact Partners who include Ring, the home security innovators among their portfolio.