Venture capital firm back by Paul Polman closes £59m for climate innovations

Pictured: The Systemiq Capital team

The new announcement builds towards a final close target of £169m that is expected to happen next year. The first funding round, which launched in 2018 has already deployed around £25m in capital towards climate solutions and companies.

Systemiq Capital, which was set up in 2018 by Paul Polman, Jeremy Oppenheim, Systemiq and Irena Spazzapan, is targeting solutions for sustainable food and material production, clean transport, climate finance and restoration projects. Existing portfolio companies include those working in synthetic biology and regenerative land use.

The London-based firm is investing across Europe, connecting innovators with a network of corporates, investors and policymakers to enable solutions to scale up. Investors to date include Lombard Odier, Andre Hoffman and The Grantham Foundation for the Protection of the Environment.

Paul Polman said: “We are finally starting to see momentum for a cleaner, fairer, more resilient economy build across business, in finance, among governments and in wider society, and the big question is how can we accelerate these shifts? Making sure the best climate tech innovations are ready and available is key.

“From developing the home chargers that are essential for getting people into electric vehicles, to pioneering short haul hydrogen flights, these are the start-ups that can catapult our climate ambitions while securing exceptionally healthy returns. But in order to grow, these businesses need more than ‘cash and contacts.”

Polman is backed by Oppenheim, a former World Bank Economist, who led McKinsey’s global climate practice for more a decade, and founded system change company, Systemiq. Spazzapan is also supporting the venture capital lending her experience as a former Goldman Sachs commodities executive.

Investment and innovation are viewed as two huge drivers towards a net-zero future.

In the UK alone, it is estimated that up to £400bn needs to be unlocked and funnelled into green infrastructure to meet the 2050 national target.

PwC, on behalf of the Global Infrastructure Investment Association (GIIA), has warned that £40bn investment per year is required over the next decade in low-carbon and digital infrastructure.  This would be double the capital allocation of the UK’s Infrastructure Delivery Plan, which in 2019 called for more than £20bn of annual private investment in the energy, water and telecoms sector.

Fortunately, venture capital investment into climate-related technology is growing five times faster than the average rate of all other industry investments. In total, $16.3bn was invested into climate tech across data, carbon capture and storage (CCS), the built environment, industrial process, agriculture, transport and energy in 2019.

While climate tech still only accounts for 6% of the venture capital market, its representation has grown by more than 3750% in absolute terms since 2013, according to PwC.