Axeleo Capital, a prominent French venture capital firm, has recently announced the launch of its €125 million Green Tech Industry I fund, aiming to drive innovation in Europe’s green technology sector. This initiative underscores the growing emphasis on climate tech as a pivotal component in addressing environmental challenges and fostering sustainable development.
Context and Background
Established in 2017, Axeleo Capital has built a reputation for supporting B2B software and greentech startups across Europe. With nearly €300 million in assets under management, the firm has made over 70 investments and achieved 18 successful exits within the past 24 months.
The European climate tech landscape has witnessed significant growth, with investments reaching record levels. In 2023, Europe’s share of global climate tech venture capital reached a record high of 43%, doubling in just four years.
Despite this progress, a financing gap persists for industrial and innovative startups, particularly those transitioning from research and development to full-scale operations. Axeleo Capital’s new fund seeks to address this gap by providing the necessary resources and expertise to support these startups during their critical growth phases.
Details of the New Fund
The Green Tech Industry I fund is dedicated to financing innovative and resilient green technologies across Europe. It targets sectors including:
- Energy: New renewable energies and storage solutions.
- Chemicals and Materials: Biomaterials and plastics recycling.
- Agriculture and Food: Bio-based fertilizers and pesticides.
- Mobility: Electric motors and the decarbonization of air and sea transport.
The fund plans to make 15 to 20 investments, with individual investment amounts ranging from €3 million to €10 million. By combining financial support with industrial expertise, Axeleo Capital aims to assist startups in establishing their first facilities and scaling their operations, thereby contributing to the development of Europe’s green industrial sector.
Investment Strategy
Axeleo Capital’s Green Tech Industry I fund is designed to bridge the financing gap for industrial startups transitioning from research and development to full-scale operations. The fund plans to make 15 to 20 investments across Europe, with individual investment amounts ranging from €3 million to €10 mil.
By combining financial support with industrial expertise, Axeleo Capital aims to assist startups in establishing their first facilities and scaling their operations, thereby contributing to the development of Europe’s green industrial sector.
Key Backers and Strategic Partners
The Green Tech Industry I fund is backed by several major investors:
- Révolution Environnementale et Solidaire fund: Financed by Crédit Mutuel Alliance Fédérale’s societal dividend, this fund focuses on supporting environmental and solidarity initiatives.
- Bpifrance and the Fonds National de Venture Industriel (FNVI): Managed by Bpifrance on behalf of the French government as part of the Plan France 2030, these entities aim to foster industrial innovation and support the ecological transition in France.
- Veolia Group: A global leader in optimized resource management, Veolia has committed €30 million to the fund, aligning with its mission to accelerate the ecological transformation of industries in Europe.
The collaboration with these strategic partners not only provides substantial financial backing but also brings valuable industry expertise and networks, enhancing the fund’s capacity to support startups in the green technology sector.
First Investment and Impact
The fund’s inaugural investment is in Sweetch Energy, a French startup specializing in osmotic energy—a renewable and controllable energy source generated from the salinity gradient between freshwater and seawater.
This investment will finance the development of Sweetch Energy’s first electricity production demonstrator using their innovative INOD® technology, currently being developed in the Rhône delta.
By supporting Sweetch Energy, Axeleo Capital aims to advance the commercialization of osmotic energy, contributing to the diversification of renewable energy sources in Europe.
Leadership and Expertise
The Green Tech Industry I fund is spearheaded by a team of seasoned professionals:
- Guillaume Sarlat: Serving as Venture Partner, Guillaume brings over two decades of experience in technology and greentech sectors, with a background in investment banking and venture capital.
- Marc Lechantre: As a Partner, Marc contributes more than 16 years of expertise from the automotive industry, having held roles in production, strategy, and international management with the Stellantis group.
- Sandra Dubos: Recently appointed as Investment Director, Sandra holds a degree in biochemistry and possesses over 15 years of experience in technology, including six years in venture capital focusing on deep tech, chemistry, and healthcare.
This multidisciplinary team combines financial acumen with industrial insights, positioning the fund to effectively support startups in scaling their operations and contributing to Europe’s green industrial transformation.
Future Outlook and Potential Impact
Axeleo Capital’s Green Tech Industry I fund is poised to play a pivotal role in advancing Europe’s ecological transition. By targeting investments in sectors such as energy, chemicals and materials, agriculture and food, and mobility, the fund aims to foster innovations that address pressing environmental challenges. The support provided to startups at critical stages of development is expected to accelerate the commercialization of green technologies, thereby contributing to the reduction of carbon emissions and the promotion of sustainable industrial practices across the continent.
Conclusion
The launch of the Green Tech Industry I fund by Axeleo Capital marks a significant milestone in the venture capital landscape, emphasizing a strong commitment to supporting green innovation in Europe. Through strategic investments and the provision of industrial expertise, the fund is set to empower startups to overcome scaling challenges and drive the development of sustainable technologies. As the fund progresses, its impact is anticipated to resonate across various industries, reinforcing Europe’s position as a leader in the global effort toward ecological transformation.
