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CEFC seeds cleantech VC firm to ‘crowd in’ private sector investors

Virescent Ventures – 70% owned by CEFC executives – now manages CEFC’s A$200m venture allocation and is fundraising another A$200m.

The Clean Energy Finance Corporation, a A$10 billion ($7.2 billion; €6.4 billion) investor backed by the Australian government, has created a venture capital firm “to crowd in additional private sector capital into the cleantech sector”.

CEFC executives Ben Gust, Kristin Vaughan and Blair Pritchard jointly own 70 percent of the new firm, Virescent Ventures. CEFC owns the remaining 30 percent, New Private Markets understands.

Virescent is targeting A$200 million for its debut fund. CEFC is expected to be an anchor investor in this vehicle, according to a statement. Virescent is also assuming management of CEFC’s Clean Energy Innovation Fund, the vehicle for its A$200 million venture allocation.

“The cleantech sector in Australia has not been the focus of many venture capital funds and Virescent Ventures will help address that,” CEFC said in a statement to New Private Markets.

“CEFC has previously been approached by groups seeking to invest in the Innovation Fund but the structure of the fund meant that this was not possible. The launch of Virescent Ventures means private capital can now be invested alongside the CEFC to further support its investment strategy in the cleantech sector.”

The investor told New Private Markets: “CEFC will continue to invest in cleantech transactions where our capital can make a difference, drawing on capital from CEFC core portfolio and/or by investing through Virescent Ventures.”

CEFC’s innovation fund has deployed A$150 million so far into 21 venture-stage companies. CEFC also has a mandate to invest in externally-managed funds in private equity, renewable energy infrastructure, agriculture and real estate. The investor has previously committed A$80 million to IFM Investors’ decarbonisation growth fund, A$80 million to Adamantem Capital’s second buyout fund and A$50 million to Gunn Agri Partners’ second fund.