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Exclusive: BlackRock-Temasek JV raises $1.4B for first fund

Illustration of a carbon molecule, US currency and geometric shapes

Illustration: Natalie Peeples/Axios

Decarbonization Partners, a joint venture between BlackRock and Temasek, closed its debut fund with $1.4 billion.

Why it matters: The tie-up between two of the world's biggest investors is putting heavy financial power behind startups aiming to tackle the climate change crisis head-on.

The big picture: Decarbonizing the global economy requires building tons of new infrastructure, from green steel mills, to novel energy storage, to battery and hydrogen production plants.

  • Those expensive projects often struggle to raise money as they expand from pilots to commercialization.

The latest: Decarbonization Partners is bringing serious capital and investment influence to that challenging stage of growth by targeting late-stage venture capital and growth equity investments with its inaugural fund.

Case in point: The fund's portfolio companies include battery recycler Ascend Elements; silicon battery materials maker Group14; hydrogen producer Monolith; and thermal energy storage startup Antora.

  • "Addressing the climate crisis requires innovation at scale, as well as significant and sustained financial resources," Temasek CEO Dilhan Pillay said in a statement. "No single entity can do it on their own."

Driving the news: Decarbonization Partners closed Fund I this month, concluding a two-year raise that exceeded the fund's initial $1 billion target.

  • It's invested in seven companies so far and ultimately expects to back 15-20 as lead and follow-on.
  • The fund is being managed by BlackRock. Investors include Allstate, BBVA, KIRKBI, Mizuho Bank, MUFG Bank, and TotalEnergies.

👀 What we're watching: Decarbonization Partners said at its launch in 2021 that it would raise a series of late-stage venture and growth equity funds. We're keeping an eye out for what follows Fund I.

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