‘Significant acceleration of LP interest’ in climate drives €860m Lightrock close

Lightrock Climate Impact Fund was oversubscribed, closing €60m above its original hard-cap as LP appetite for impact strategies surges.

Lightrock, an impact firm launched by Liechtenstein’s LGT Group, has closed its inaugural climate fund on €860 million, €60 million above its original hard-cap.

The close comes amid a “significant acceleration of LP interest for climate impact strategies”, in the current environment, Kevin Bone, partner at Lightrock, told New Private Markets. “Climate has shot to the top of LPs’ agendas over the last 12 months as global crises crystallise the importance of impact investing… Regulatory mandates around reporting and allocations have also added to the momentum around it,” he said.

Lightrock Climate Impact Fund (LCIF) was formally launched nine months ago. Bone noted that the timeframe is “quite abbreviated for fundraising of this scale”.

LCIF was oversubscribed, exceeding its €600 million target. The vehicle secured commitments from new and existing investors, including Lightrock’s anchor investor LGT Group and its private banking clients.

New backers include: Thai energy group GULF, First Swedish National Pension Fund (AP1), New Zealand charitable foundation Bay Trust, Netherlands-based climate technology investment form Carbon Equity, Temasek’s GenZero platform, European asset manager Golding Capital Partners, US charitable foundation Grantham Foundation, German family-owned investment holding Haniel, Australian pension fund NGS Super, Austrian insurer UNIQA, and Dutch impact investor Wire Group.

LGT’s commitment to the fund was made ahead of its official launch. Bone said this was an important “differentiator” for LCIF as it allowed Lightrock to show potential investors “what we do, as opposed to what we plan to do”.

LCIF will make initial investments of €10 million to €40 million in growth-stage companies, “driving net-zero innovations” in Europe and North America. It will invest along five themes: energy transition, decarbonisation of industries, sustainable transportation, sustainable food and agriculture, and enabling technologies and services.

Lightrock has already made seven investments in companies operating across these themes. “These assets are warehoused for the fund,” the firm said.

LCIF is classified as an Article 9 Fund and each portfolio company will report on its impact on a regular basis. LCIF companies will also use Lightrock’s “proprietary approach to impact assessment and management”, the firm said.

The close of LCIF follows an active fundraising period for Lightrock, which closed its Latin America-focused growth fund on $300 million in May and Lightrock Growth Fund I on $900 million in 2021.