The clean energy and climate tech VC firm Emerald Technology Ventures is rolling out a €250 million (~$264 million) fund focused on institutional investors, Axios has learned.
Why it matters: Emerald has traditionally focused on corporates, but those firms tend to have less capital than institutional investors — and startup valuations are soaring, forcing investors to bring more cash to the table.
The details: Emerald's new European Transformation Fund will focus largely on — you guessed it — Europe, with a target investment size of €10-€15 million (~$10.6-$15.8 million), managing partner Gina Domanig tells Axios.
That's potentially slightly larger than Emerald's typical target investment of about €10 million.
The fund will seek to allocate about 40%-50% of its investments in energy companies, with the rest aimed at water, industrial technology, food, agriculture, mobility, robotics and advanced materials and packaging,
Catch up fast: Emerald has about €1 billion (~$1.1 billion) in assets under management and under advisory. About €370 million (~$390 million) of that amount is under management, Domanig says.
The firm's existing funds have focused on corporates and largely targeted climate startups within industrial tech.
"This is the first time that we have been working with institutional investors since they all exited stage-left at the financial crisis last time," Domanigsays, referring to the cleantech 1.0 bubble in the mid-aughts.
Flashback: In April, Emerald announced the launch of a €200 million (~$217 million) venture fund focused on the sustainable packaging supply chain.
What they're saying: "Institutionals cut much bigger checks,” Domanig tells Axios.
"The deals that we're doing, the companies could scale if they had more cash — particularly European deals, because European financing rounds are typically smaller than U.S. financing rounds," she continues.
At the same time, Emerald is keeping an eye toward a potential correction in sky-high startup valuations, especially in the U.S.
What's next: The first meetings with potential investors took place this week.