Credit Suisse-backed climate VC 2150 returns to market sophomore fund

Urban decarbonisation VC 2150, incubated by Nordic real estate manager NREP, closed its first fund on €268m in 2021 – the largest known VC fund in this sector.

Urban decarbonisation-focused venture capital firm 2150 has launched its second fund, New Private Markets has learned. The exact target for Fund II is not known; however, a source familiar with the fundraise said 2150 hopes to raise more than Fund I, which closed on €268.2 million in October 2021.

2150 was set up and incubated by Nordic Real Estate Partners, a real estate firm with €20 billion in assets under management and a reputation for its sustainability efforts (NREP has set a 2028 net-zero target, for example).

The debut fund, which had a €200 million target, is focused on climate technologies for real estate. It is the largest venture fund in this sector known to NPM.

Among its LPs are a number of high-profile institutions including Credit Suisse’s Climate Innovation Fund, a pooled fund-of-funds investing capital from the Swiss bank’s wealth clients; the BMW Group; the BMW Foundation; Toyota’s venture investing fund Woven Capital; Norway’s sovereign climate investor Nysnø; and Denmark’s sovereign climate investor the Green Future Fund.

The first fund has struck 16 deals so far in companies around carbon capture, biodiversity measurement and low-carbon cement.

For its second fund, however, NPM understands that 2150 is expanding its investing remit. Fund II will consider start-ups addressing the decarbonisation of the energy, industry and transport sectors, according to a source familiar with the fundraise. The source noted that these themes still contribute to 2150’s original mission of decarbonising urban settings, while allowing 2150 to access interesting opportunities further afield.

2150 declined to comment on fundraising matters.

Self-imposed carbon tax

2150 has voluntarily introduced a carbon tax for the firm’s own emissions, head of sustainability Peter Hirsch told NPM last month. The commitment involves pledging €100 per tonne of carbon dioxide emissions for Scopes 1, 2 and 3 of 2150’s operations – excluding emissions associated with portfolio companies. The €100 per tonne will be paid to projects scaling nature-based carbon sequestration and carbon credit generation projects.

NPM asked why 2150 is paying its self-imposed carbon tax in this way rather than buying certified carbon credits. “This is the most additional use of the capital,” Hirsch said. “There’s not enough supply of [certified, gold standard] carbon credits. They’re really hard to find. We’d rather focus on building up that industry than taking those away.”