SUMMARY
- Avaana Capital has closed a $135 million fund focused on climate and sustainability startups.
- Initially targeting $100-125 million, it had its first close at $70 million in June 2023.
- Through this fund, Avaana Capital plans to invest in 20-25 early-stage companies.
Avaana Capital, a Mumbai-based early-stage investment firm, has closed a $135 million fund focused on climate and sustainability startups. This specialized fund, initially targeting $100-125 million, had its first close at $70 million in June last year.
Through this fund, Avaana Capital plans to invest in 20-25 early-stage companies, with an average first cheque size ranging from Rs 10 crore to Rs 30 crore. The firm intends to double down on successful investments.
According to Avaana Capital’s founding partner, Anjali Bansal, “The biggest investment opportunities, and subsequently returns, come from innovations in areas that are undergoing large transitions. If you look at the two mega trends playing out in the world right now … first is artificial intelligence and everything that comes with it, and the second is climate change.”
Avaana Capital will provide early-stage capital to startups with a “core innovation” focus on areas surrounding energy transition, supply chain, resources, industrial decarbonization, and food systems.
The fund has several prominent limited partners, including the GCF (the world’s largest climate financing fund), the US International Development Finance Corporation, the UK Government, the Self Reliant India Fund managed by SBI Ventures, the Small Industries Development Bank of India, and the Azim Premji Trust, among others.
Avaana Capital has already backed six startups through this new fund, including Kazam (electric vehicle charging solutions), Sentra World (ESG platform for industrial businesses), and Eeki Foods (agritech startup).
According to Tracxn, startups in the climate-tech space raised nearly $2 billion in funding in 2023 across 226 rounds, and have already raised $1.2 billion through 137 rounds so far in 2024.
