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India’s first energy transition-focused venture capital firm, Transition VC, has launched a fund with a target corpus of ₹4 billion ($48.9 million), which includes a greenshoe option of ₹2 billion ($24.4 million).
The Bengaluru-based firm will invest in electric mobility, green hydrogen, energy storage, net zero in buildings, and climate tech. With ticket sizes ranging from $500,000 to $1 million, it aims to support up to 40 early-stage startups over the next three years.
The fund will allocate 25% of the corpus to global startups. For its international investments, Transition VC has a strategy to invest in developed market products that could be introduced to an emerging market like India.
The firm recently received approval from the capital markets regulator Securities and Exchange Board of India. It intends to mark the fund’s first close by the end of the calendar year 2022.
Raiyaan Shingati, Co-founder & Managing Partner of Transition VC, said, “Climate Change & Energy Transition is a business opportunity, as they demand reinvention of every segment of the industry. We are at the beginning of a new era! Major shifts like this don’t come around that often, but we are starting to see one now, and it’s going to shape how people consume energy for decades to come.”
Transition VC claimed that its maiden fund is seeing growing interest from Indian and global high-net-worth individuals, family offices, and corporates specialized in strategic investments.
The fund is looking at an invite-only pool of investors who understand the domain well and are aligned with its vision, the VC firm said.
The recently concluded United Nations Climate Change Conference (COP27) highlighted the need for global investments of $4 trillion per year in renewable energy until 2030 to achieve net zero emissions by 2050.
According to Mercom’s 9M and Q3 2022 Funding and M&A Report for Storage, Grid, and Efficiency, global corporate funding for energy storage, smart grid, and energy efficiency companies in the first nine months (9M) of 2022 increased by 66% to $25 billion compared to $15.1 billion raised in 9M 2021.