Spain’s publicity to local weather change helps Madrid-based VC Seaya shut €300M local weather tech fund

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In keeping with a latest Dealroom report on the Spanish tech ecosystem, the mixed enterprise worth of Spanish startups surpassed €100 billion in 2023. Within the newest affirmation of this upward pattern, Madrid-based VC fund Seaya has closed Seaya Andromeda, an “Article 9” €300 million local weather tech fund primarily based out of Madrid.

Article 9 refers back to the EU’s Sustainable Finance Disclosures Regulation Act, which places the onus on funding companies to make sure their investments have a constructive impression on society or the atmosphere. 

Seaya has been round for 12 years, primarily specializing in mission-driven startups in Europe and LatAm. The brand new “Andromeda” fund will put money into development corporations focusing on power transition, decarbonization, sustainable meals worth chains, and the round financial system.

The agency mentioned the brand new local weather fund will deploy between €7 million and €40 million as a primary test; will retain capital for follow-ons; and plans to make 25 investments by the top of 2027. Thus far, 5 investments have been produced from the fund (see under).

Seaya was launched again in 2013 by former non-public fairness investor Beatriz González, who bought into local weather and sustainable investing after backing a recycled clothes line. She beforehand labored for Morgan Stanley, Excel Companions and Darby Abroad Investments within the U.S. After that she grew to become a director of Telefónica’s pension fund, main its different belongings program.

Beneath González, Seaya has invested in local weather tech corporations, together with Biome Makers, Readability.ai, Crowdfarming, Descartes, RatedPower, Samara, and electrical automotive charging stations firm Wallbox (which went public on the New York Inventory Trade in 2021). 

Over a name, I requested González if she thought there’s a explicit benefit in having a fund out of Spain tacking local weather tech, given the nation’s proximity to among the worst results of a altering local weather, corresponding to excessive warmth, drought, wildfires and storms.

“It’s an excellent query,” she mentioned. “If you consider power transition and decarbonization, coming from Southern Europe, notably Spain, we do see that we’re higher suited to two causes. One is as a result of Southern Europe is having extra excessive warmth waves. So clearly, there’s way more social consciousness. However we additionally suppose that now we have aggressive benefits within the industries that we’re focusing on.

“We’ve been pioneers in renewable power, so now we have the expertise and now we have the massive corporations within the manufacturing of auto components. So now we have a giant industrial base. The identical with agriculture and actual property publicity. So we do consider that now we have the trade experience and expertise coming from Southern Europe, particularly, and Spain, that does give us a little bit of benefit.”

I additionally requested what sort of experience they’ve that can permit them to make deep tech funding selections about local weather tech.

“Now we have a few engineers so now we have that in-house experience, however in our LP community now we have massive European Union banks like Santander which do challenge finance for power or factories. So getting access to that information helps us do the due diligence and transfer a lot quicker.”

So far, Seaya has used that information to put money into a number of related corporations. Spain-based augmented-reality ability coaching answer Seabery, for instance, developed AR software program and {hardware} for coaching welders, that means they don’t want to make use of actual welding to coach, thus decreasing carbon emissions by 95% per welding session.

It has additionally invested in U.Ok.-based AI-powered waste administration startup Recycleye in February 2022, which builds robots to kind garbage for recycling. 

In San Francisco, the agency invested in Pachama, a local weather tech firm that makes use of information to confirm the standard of carbon credit and allow the launch of latest carbon credit score initiatives. 

The information of the brand new fund follows different indicators of the Southern European funding renaissance. Solely final week, Plus Companions launched in Barcelona, aiming to drum up a $30 million to $50 million fund.

The annual “State of European Tech” report for 2023 additionally discovered Spain’s ecosystem to be in fourth place total and mentioned it had the highest variety of startup fundings final yr.