Kiko Ventures is announcing it has created a $450 million venture capital fund focused on cleantech investments.
The goal is to support transformative cleantech. It comes as the global investment in cleantech reached an all-time high of $40 billion in 2021. And events during 2022 have further increased momentum for sustainable technologies. The timing is important as many funds are considering pulling back on investments because of the expected downturn in the economy and high inflation.
However, there are structural constraints on the existing funding landscape. The ecosystem lacks the flexibility required to optimally address the climate challenge. London-based Kiko Ventures’ team has spent decades investing in climate tech and backed world-leading businesses including Ceres Power, First Light Fusion and Oxbotica.
Kiko’s evergreen structure provides exceptional flexibility and strong, long-term alignment with climate tech entrepreneurs.
Launched by the FTSE 250-listed investment firm IP Group, Kiko Ventures is a new investment platform designed to support and grow the category-leading climate tech champions of the future. The team plans to deploy $245 million over the next five years using IP Group’s flexible capital platform. Kiko will launch with existing assets, valued at over $215 million, as well as a number of new investments already made under the Kiko strategy that are yet to be announced. IP Group provided all the money.
Kiko benefits from IP Group’s evergreen structure: through which returns from exits can be recycled into new opportunities, allowing for a true evergreen portfolio without crossover between fund vehicles and with a very long time-horizon.
With an increasingly urgent solution required to avert the most damaging aspects of climate change, Kiko Ventures is seeing a resurgence of climate tech investment across the world. Figures from Climate Tech VC suggest global investment reached an all-time high of $40 billion last year.
Recent events in Europe have also focused attention on the need for energy sources that are more sustainable. However, most investors in cleantech operate traditional fund structures or need to adhere to the commercial agendas of corporate venture capital (CVC), imposing constraints on the existing financing landscape.
The Kiko Ventures’ founding team combines the established IP Group cleantech team, led by veterans Robert Trezona and Jamie Vollbracht, with new partner Arne Morteani, who previously spent 14 years helping to build one of Europe’s leading cleantech VC funds. The whole team has dedicated their careers to climate tech and the three partners have navigated two economic cycles as investors in the space.
This team has now designed Kiko Ventures, which leverages IP Group’s evergreen platform to take a more flexible approach, without the short time horizons, fixed capital constraints, and narrow mandates that are common in the industry. Kiko is therefore exceptionally aligned with entrepreneurs wanting to build category-leading companies for the long term. The team aims to enrich the existing ecosystem and become a reliable partner, to both entrepreneurs and fellow investors, in building a regenerative future.
As an evergreen platform without a fixed 10-year investment mandate, Kiko Ventures can be a flexible investor, able to do what’s required. It can be entrepreneurial through venture creation of new companies, invest at Seed and Series A/B stage or choose to capitalize on opportunities in the public capital markets.
The team has global experience in operating across all these stages. As one of the largest climate-tech investors in Europe, Kiko Ventures will primarily invest directly, and on occasion indirectly through selected funds. It will combine this structural flexibility with a focus on thematic areas where it can build deep expertise and value.
“I believe in the transformative power of climate technologies and have worked my whole career to elevate ideas from the lab into practical usable solutions that can make our world a better place,” said Robert Trezona, founding partner of Kiko Ventures, in a statement. “We’ve launched Kiko to unleash the full power of human ingenuity by uniting ideas, expertise and capital to unlock a sustainable future. To do this, we’ve created an investment model of truly flexible capital that empowers change, rather than hindering it.”
The team has historically made ambitious investments in high-conviction areas. Examples include fuel cell firm Ceres Power, which the team helped to take to unicorn exit; First Light Fusion, which recently achieved a world’s first fusion result; and Oxbotica, a pioneer in autonomous mobility software supplying some of the world’s largest companies like BP and ZF.
Jamie Vollbracht, founding partner of Kiko Ventures said in a statement, “My realization about the urgency of the climate crisis came shortly after leaving University and I decided to devote my career to doing what I could to help. I found I was most useful in commercializing innovative clean technologies and have sought to develop better ways to help those technologies flourish ever since. Kiko brings together all the insight I’ve been fortunate to glean over the past two decades and I hope it will make an outsized positive impact on the journey to a sustainable future.
Over two decades, the team has taken hands-on operational and investment roles steering innovative businesses through tough economic climates, including the first cleantech boom and bust and the Covid-19 pandemic. In addition, most of the team started out with successful research careers in climate tech and so combine commercial experience with an understanding of the deep technologies behind many of the most transformative innovations.
Through IP Group, Kiko Ventures has a global footprint and a network of high-level contacts from labs to board rooms. The team is in frequent communication with some of the world’s leading scientists and entrepreneurs, as well as a wide range of industry and capital markets leaders.