Climentum Capital - Our genesis story
June 27, 2024
Climentum Capital is an Article 9 fund investing in early stage European climate tech companies that solve critical sustainability problems for industries. With offices in Copenhagen, Berlin and Stockholm, we provide catalytic capital to companies in late Seed and Series A rounds, enabling them to pass key inflection points and scale rapidly.
As an Article 9 fund using a dual carry structure with strong financial and environmental impact targets, Climentum Capital stands out in its commitment to only investing in companies that can deliver significant greenhouse gas emissions reductions.
This is the story of how we came to launch our Article 9 fund.
Turning an idea into reality
The original spark for Climentum Capital can be traced back to Oxford University, where Morten was exploring dual carry models as part of an executive programme on impact investing. After studying these models in theory, Morten decided that he wanted to develop one in the real world.
This is when he began assembling the rest of the team - Malin, Dörte and Stefan - to build our VC fund. We all came from diverse backgrounds but were united by our shared vision: Investing in champions of decarbonization.
We got off to a rough start with the COVID-19 pandemic hitting Europe, but we proceeded to build Climentum Capital against the uncertain macroeconomic backdrop and decided on fundamentals while learning to operate in a highly effective remote-first manner.
One of our earliest decisions was that an Article 9 fund was the right format for Climentum Capital, meaning that all of our investments must create sustainable impact. We share a determination to only invest in tech that will transform the very fundamentals of an industry, and Article 9 is the best format for this.
Coming back to Morten’s early insights, we also employed a dual carry model from the start, aligning and incentivizing financial performance and climate positive impact. This drives us to deliver fully commercial impact investing returns. Few other funds use dual carry models like we do: Most funds designed with a dual carry model determine impact on a case-by-case basis for each investment, resulting in moveable targets. We have a fixed portfolio-level hard target of 1 MtCO2e, which is auditable to established standards.
Another defining aspect of Climentum Capital is that we focus on hard tech. To abate enough CO2 to significantly limit climate change, we can’t rely on software solutions. VCs need to invest in hardware and deep tech solutions, but the solutions to many pressing industry challenges are overlooked and underfunded. We believe that we have the dedication and expertise required to fill this gap and support high-performing companies to generate great returns for our investors. By solving real industry problems, the hard tech companies in our portfolio will create impact at scale, while macro trends hold the promise of outsized returns.
Assembling a powerful team
It was important to us all that we build a team with shared values, a high-energy dynamic, and the right mix of skills. Today, our core team of four - Malin, Dörte, Morten and Stefan - is a group of equal partners. Each one of us makes up a key piece of the puzzle:
Malin is the deal-making machine. Her broad investment experience, vast network and specialist skills in understanding board work and how to assess and grow companies make her a powerhouse when it comes to deal sourcing, deal execution and portfolio support.
Dörte is excellent at due diligence. Her non-emotional approach to business enables her to consistently ask the right questions and focus on the details and facts of a situation to come to the smart decision and identify the right climate tech startups for us.
Morten is a valuable asset when activating capital from large infrastructure or pension funds and structuring complex financing rounds with equity, debt and grants, which is essential for hard tech companies. His nearly two decades in institutional investment mean he understands institutional investors’ mindsets and speaks their language, giving him a unique skill for attracting crucial funding for our portfolio companies.
Stefan is a strategist with an inherent skill for assessing impact. He maintains a clear perspective and draws on in-depth market knowledge throughout the investment process and the portfolio work with companies. He uses his extensive network in the impact and grant ecosystem to support our portfolio companies.
A pioneering Article 9 fund
From JOLT building next generation electrodes for electrolysers, insect farming technology provider Entocycle accelerating a global transition to sustainable protein, to one.five closing the loop on the circular economy with its recyclable packaging solution, we’re already funding many pioneers’ journeys.
Our support isn’t just financial. We invest in the teams and technology we really believe in, so we dedicate a lot to guiding them on their startup journeys however we can. We construct and sometimes lead follow-up funding in often complex rounds with equity, debt, grants and even in SPV structures. We support building the right team and hiring important resources like CFOs and operational experts. Or we offer valuable guidance for rapid industrial scaling - most recently for Novatron Fusion, which is on track to deliver the world’s first commercial nuclear fusion reactor. In addition we provide help on the impact side, updating life cycle assessments, making impact oriented business decisions and communicating the impact story in the right way.
Our plan for the future is to continue using our unique experience and network in hard tech to support our portfolio companies while investing in new companies that we know have the emissions reduction and financial potential to transform their industries and create a world where all industries are sustainable, low-carbon and circular.
