New climate fund targets "rebuilding the physical economy"
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Gigascale Capital, the VC firm founded by ex-Meta CTO Mike Schroepfer, just announced a new $250 million fund to back startups "rebuilding the physical economy for climate impact."
Why it matters: It marks an evolution of the climate-focused firm Schroepfer launched in 2023 that supports early-stage startups.
- The new fund is Gigascale's first backed by outside institutions and organizations (which it didn't immediately name).
The big picture: The combo of rapid electrification, industrial re-shoring, AI and extreme weather is "exposing the limits of physical systems built for a different era," Monday's announcement states.
- Gigascale is focusing on where constraints are "most acute," like clean energy, automation, grid infrastructure, and supply chains to support them.
Driving the news: The new institutional fund unveiled Monday is already deploying capital.
- The portfolio includes Heron Power, the advanced transformer startup founded by former Tesla exec Drew Baglino; micro-reactor startup Radiant; and rare earth magnet recycler Solcoa.
State of play: Part of the investment thesis is that climate benefits of new tech are an offshoot of better performance that breaks through into the market.
- "Solar went from 40 gigawatts a year to 600 in a decade because it got cheaper, not because it got more virtuous," Schroepfer said in a statement.
What's next: While Gigascale works with early-stage startups, it plans to "opportunistically" complement this strategy, "enabling the firm to support founders from first check through scaled deployment," the rollout states.
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