Avaana Capital Secures $70 Mn For Its Climate & Sustainability Fund

Climate-focussed venture capital firm Avaana Capital has raised $70 Mn for its first close in Avaana Climate and Sustainability Fund. The VC firm is targeting a total corpus of $100-125 Mn for the fund.

The fund will focus investments in three sectors including energy transition and resource management, mobility and supply chains, sustainable agriculture and food systems.

The fund has attracted renowned institutional investors such as Small Industries Development Bank of India (SIDBI), Self Reliant India (SRI) Fund, the UK India Development Cooperation Fund (UKIDCF) and marquee corporates such as Godrej Group, Murugappa, Torrent, Tsadik, and Bellerive Capital, among others, Avaana Capital said in a statement.

Led by Anjali Bansal, Swapna Gupta, and Shruti Srivastava, Avaana Climate and Sustainability Fund will further invest in tech-driven and innovative climate solutions, looking to solve climate risk mitigation, adaptation and resilience building.

“With significant global capital flowing, supportive policies, corporate interest and wealth of entrepreneurial talent in the climate sector, India’s climate-tech story is rapidly progressing. At Avaana Climate and Sustainability Fund, we evaluate over 200 new climate opportunities every quarter,” Anjali Bansal, founding partner of Avaana Capital, said.

Founded in 2018, Avaana Capital backs startups that work on sustainable supply chains across industries, clean transport, sustainable input platforms, climate-resilient processes, precision agriculture, circular economy platforms as well as alternative materials and chemicals.

The firm’s portfolio includes the likes of FarMart, Terra.do, Turno, NinetyOne Cycles, Sentra.World among others.

As the climate tech sector is gaining more and more attention from investors, Bengaluru-based boutique investment advisory firm CaHa Capital recently launched a climate tech and climate finance-focussed venture studio, VAIA Climate Studio, to build startups from scratch and then invest in them and scale.

As per a report, the climate tech market, which was pegged at over $12.5 Bn in 2021, is expected to grow at a CAGR of around 24% between 2022 and 2028.