Cycle Capital and Demeter: Euro 160m for new Circular Innovation Fund
Dusseldorf/ Paris — Cycle Capital and Demeter, leading cleantech-focused asset managers, announced the successful first financing close for their new Circular Innovation Fund (“CIF”) of $160 million and €150 million, respectively, with participation from anchor investor L’Oréal.
Anchor investor L’Oréal is contributing 50 million euros through its sustainability program L’Oréal for the Future. The fund also benefits from a broad range of investors, including strategic investor Axens, family offices such as Haltra and Claridge, as well as private investors and the fund managers.
Through this fund, the fund managers are pooling their resources to scale circular, sustainable and profitable growth solutions from North America, Europe and Asia that positively contribute to climate change mitigation and the circular use of resources in a variety of sectors, including new materials, packaging, recycling and waste, logistics, eco-efficient processes and design. The fund will leverage the investment managers’ experience in venture capital, private equity and infrastructure in the cleantech sector to address the growing need for market-ready solutions and provide capital for talented, entrepreneurial teams to implement these innovations.
The CIF is a sustainable innovation fund classified as “Article 9″ under the EU Regulation on sustainability-related disclosure requirements in the financial services sector. The Fund’s robust, reliable, and innovative impact measurement methodology includes due diligence and ongoing monitoring of critical non-financial metrics, including greenhouse gas emissions reductions, resource use, and diversity within portfolio companies’ investment horizons. Fund managers’ compensation is also based on the achievement of a selection of predefined impact targets.
- “In a context of ’now or never,’ as stated in the latest IPCC report, private companies like L’Oréal must play a greater role in supporting solutions that are critical to the future of our planet and humanity. At L’Oréal, we believe that impact investing is a powerful tool to address the biggest environmental challenges and accelerate the necessary green transformation. Through the Circular Innovation Fund, we are joining forces with other committed players to scale circular and profitable solutions for sustainable growth.” — Alexandra Palt, Chief Corporate Responsibility Officer and CEO of Fondation L’Oréal.
Investments in early-stage venture capital funds
Following the initial closing, CIF announces indirect investments in two early stage funds focused on circular innovation — the U.S. Closed Loop Venture Fund II and the European Circular Bioeconomy Fund (“ECBF”).
Founded in 2014, Closed Loop Partners is a New York-based investment firm that includes venture capital, growth capital, private equity and catalytic capital, and an innovation center focused on advancing the circular economy. The company’s venture capital arm, Closed Loop Ventures Group, launched in 2017 with one of the first venture capital funds to invest in early-stage disruptive companies developing breakthrough solutions to accelerate the transition to a circular economy. In 2021, the Group launched its second risk fund to build on this strategy. To date, the team has made more than 30 investments in both funds, targeting high early-stage returns.
ECBF is the first venture fund to invest exclusively in high-growth companies in the European bioeconomy, including the circular economy. The fund aims to make sustainable investments in our future and accelerate the transition from a fossil-based to a bio-based economy. In this way, ECBF supports companies with high innovation potential, attractive returns and sustainable impact.
CIF will also sponsor a global acceleration program through a partnership with Cycle Momentum. The program provides support for seed/series A stage startups with cohorts in Europe, North America and Asia over 3 years.
The CIF investment team is actively exploring a variety of investment opportunities and welcomes inquiries from and collaborations with founders and co-investors.
About Cycle Capital
Cycle Capital is a sustainable investor and a leading private cleantech venture capital investment platform with $600 million in assets under management. With offices in Montreal and Toronto, as well as Qingdao, China, and a presence in New York and Seattle, Cycle Capital invests throughout North America and China in growing and commercially successful companies that have developed technologies to reduce greenhouse gas emissions and optimize resources and processes. Cycle Capital is the founder of the Cycle Momentum Accelerator and Canadian co-chair of the Beyond the Billion Initiative — an international campaign to mobilize a consortium of investors to support women founders. cyclecapital.com.
Demeter is a large European investment platform dedicated to ecological change. Demeter manages over 1 billion euros and has already made 200 investments since 2005. Demeter invests between 1 and 30 million euros to support companies at all stages of development: innovative startups, high-growth SMEs and infrastructure projects. The 38-strong team works in Paris, Lyon, Bordeaux, Grenoble, Metz, Madrid and Düsseldorf. Demeter is a responsible and committed investor and signatory to numerous initiatives such as PRI (Principle for Responsible Investment), CDP (Carbon Disclosure Project), iC20, The Shift Project and gender diversity initiatives. All new Demeter funds are classified as “Article 9″ under the framework of the new European regulation on sustainability-related disclosure requirements in the financial services sector. www.demeter-im.com.
For over 110 years, L’Oréal, the world’s leading beauty care company, has been dedicated to one thing: fulfilling the beauty desires of people around the world. Our goal to create the beauty that moves the world defines our approach to beauty as inclusive, ethical, generous, and committed to social and environmental sustainability. With our broad portfolio of 35 international brands and our ambitious sustainability commitments under our L’Oréal for the Future program, we offer the best in quality, efficacy, safety, honesty and responsibility to everyone around the world.