NEW YORK & SINGAPORE--(BUSINESS WIRE)--Decarbonization Partners, a partnership between BlackRock and Temasek focused on investing in next-generation private companies that support the acceleration of decarbonization and the transition to a net-zero economy, today announced the final close of US$1.40 billion for its inaugural late-stage venture capital and growth private equity investment fund, The Decarbonization Partners Fund I (the “Fund”), surpassing its fundraising target of US$1 billion.
In addition to commitments from BlackRock and Temasek, the Fund has attracted a diverse set of over 30 institutional investors representing 18 countries, including public and private pension funds; sovereign wealth funds; insurance companies; corporates and family offices across North America, Europe and Asia Pacific.
Investors in the Fund include, among others, Allstate, BBVA, KIRKBI, Mizuho Bank Ltd., MUFG Bank Ltd., and TotalEnergies; and capital commitments from a number of Singaporean institutional investors. The diversity and depth of the investor base reflects the global nature of the opportunity around climate investing, which directly aligns with Decarbonization Partners’ global focus.
“This successful fundraise demonstrates the unique strength of our team and platform, which we’ve been building for the last two years. Clients have shown conviction in our ability to execute our strategy of supporting the acceleration of decarbonization and the transition to a net-zero economy through our investments,” said Dr. Meghan Sharp, Global Head of Decarbonization Partners. “Decarbonization Partners was deliberately set up as a purpose-built entity that can uniquely convene and collaborate with key players in the climate ecosystem: innovative companies, large corporates, co-investors, clients and later-stage capital providers. I’m extremely proud to be leading this business alongside our global partners.”
Launched in 2022, Decarbonization Partners has established itself as one of the leading climate technology investing platforms globally and is focused on developing an ecosystem of sophisticated investors who seek to accelerate capital deployment into the emerging climate tech asset class. The global team of investors also brings strategic, financial, operational, and technical expertise along with deep pools of capital to support Decarbonization Partners’ portfolio companies.
“There is enormous demand for energy infrastructure as many countries seek to transition to lower-carbon sources of power while also achieving energy security. Decarbonization Partners brings together the best of Temasek and BlackRock to identify generational investment opportunities in climate technology that we believe will help to bring down the green premium, enable a more affordable energy transition, and generate long-term financial returns for our clients,” said Larry Fink, Chairman and CEO of BlackRock.
“Addressing the climate crisis requires innovation at scale, as well as significant and sustained financial resources to enable that. No single entity can do it on their own. We’re pleased and encouraged to see many other partners and investors coming on board for Decarbonization Partners’ inaugural fund. Their participation will support the acceleration of innovative solutions for real-world decarbonization at scale,” said Dilhan Pillay, Chief Executive Officer, Temasek. “Such collaborations and collective efforts are critical as we strive to accelerate progress towards our global net zero ambition.”
The Fund’s dual-purpose investment strategy seeks to generate attractive long-term financial returns while investing in companies that are driving intentional, material and measurable decarbonization outcomes. Decarbonization Partners, a SFDR Article 9 fund, invests in companies with de-risked technologies that are ready to scale and can benefit from BlackRock and Temasek’s complementary platforms and deep access.
The Fund has already invested capital into seven companies that span several innovative decarbonization technologies. This includes investments in sustainable materials, including for improved performance in li-ion batteries, clean hydrogen, science-based carbon management services, low-emissions battery recycling, EV fleet management, and thermal energy storage for industrial applications. The team has built a robust pipeline of proprietary deal flow, which it will continue to execute on the coming months. To learn more about Decarbonization Partners’ portfolio companies, click here.
The Decarbonization Partners team has grown to over 25 members, including experienced venture capital and growth equity investment and portfolio management professionals across offices in New York, San Francisco, Singapore, London, Paris and Houston. The team was intentionally constructed to provide portfolio companies with trusted value-add partners who bring significant technical and operational experience.
About Decarbonization Partners
Decarbonization Partners is a joint venture between Temasek and BlackRock focused on late-stage venture capital and early growth private equity investing in next-generation companies that provide solutions and technologies to help accelerate global efforts to achieve a net zero global economy by 2050. Decarbonization Partners combines Temasek and BlackRock's complementary platforms and expertise in sourcing and underwriting private investments, portfolio and risk management, and sustainable technology and analytics. Decarbonization Partners invests in a wide range of companies that have proven technology and need capital to scale. The partnership targets multiple sectors, including Carbon Capture, Storage and Utilization, Bio and Low Carbon Products, Next Generation Energy, Advanced Mobility, Carbon Management Services and Digital Transformation. The partnership reflects BlackRock and Temasek's shared commitment to help build more sustainable and resilient portfolios, while also contributing to consistent, long-term financial returns that benefit their clients and stakeholders.
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Lack of available investments: The Fund will be competing for exposure to investments in a highly competitive market, against other funds, as well as individuals, financial institutions, strategic players and other investors, some of which may have greater resources than the Investment Manager. There can be no assurance that the Fund will be able to locate, attain and exit investments that satisfy its investment objectives, or that the Fund will be able to fully invest its committed capital.
Restriction on Withdrawal: The Fund is not intended to be a short-term investment and has no certainty of returns. Commitments to the Fund are generally not transferable or redeemable and Investors will be committed to the Fund for its duration and may not be able to withdraw from their participation prior to the expiry of the Fund.
Investments in equity securities: The value of equities and equity-related securities can be affected by daily stock market movements. Other influential factors include political, economic news, company earnings and significant corporate events.
Interest Rate Risk: The fund invests in fixed interest securities such as corporate or government bonds which pay a fixed or variable rate of interest (also known as the ‘coupon’) and behave similarly to a loan. These securities are therefore exposed to changes in interest rates which will affect the value of any securities held.
Start-up or Venture Portfolio Companies: The Fund expects to focus on investing in the venture capital space or in start-up companies. Investments in portfolio companies that are newly formed, less mature than their competition, or that are engaged in business in a rapidly evolving industry involve a particularly high degree of business and financial risk, are considered highly speculative and may result in the loss of the Fund’s entire investment. Early-stage investments may require substantial additional capital to support growth or to maintain their competitive position. Such capital may not be available on attractive terms from private sources. The Fund’s capital is limited and may not be adequate to protect the Fund from dilution in multiple rounds of funding. The public market for early-stage companies is highly volatile. Such volatility may adversely affect the ability of portfolio companies to raise capital when needed, the ability of the Fund to dispose of investments and the value of the Fund’s investment securities on the date of sale or distribution.
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