BXVentures, a New York-based climate venture studio, has announced a new fund of up to $250 million to back early stages climate tech start-ups.
The studio seeks out budding technologies that can be established as companies and helps in building them into commercial entities.
The fund will invest in start-ups that are at the early stages of development with a heavy focus on research and development.
The final figure for the fund will be between $200 million to $250 million but BXVentures declined to comment on how much has been raised so far or who its backers are.
BXVentures, through its offices in Montreal, New York and Brussels, will seek technologies that are “trapped” at universities where it can often be hard to get a business case for the tech off the ground.
According to BXVentures, it has partnered with McGill University to finance clean tech developed at the Canadian university that can be spun out as a start-up and commercialized.
Under the agreement, McGill gets a mix of equity and royalties on the commercialization of the IP.
BXV Advisory, the venture studio’s advisory arm, assists in scouting investments at universities that hold great promise in climate tech.
“As the escalating effects of climate change become increasingly apparent, accelerating lab-to-market adoption of innovative climate technology solutions is becoming increasingly paramount,” Romain Decorps, managing partner at BXVentures, said.
“In contrast to the traditional VC model, venture studios create companies from scratch and provide both capital and operational support. This strategy has historically resulted in higher equity stakes and a higher success rate for the underlying companies, which ultimately enables a compelling opportunity to dramatically increase climate impact by bringing meaningful technologies to market,” he said.
Daniel Malek, another managing partner at BXVentures, said its approach helps in “de-risking” technologies that other VCs may be reluctant to invest in.
“As an illustration of its process, leveraging its partnership with McGill University, BXVentures is getting ready to announce the spin-out of groundbreaking climate technology focused on revolutionizing long duration energy storage,” Malek said.
That start-up is Fex Energy. Some of BXVentures’ previous investments include Thermo Power Systems, which it said is tackling energy wastage in industrial settings by converting heat into usable energy. It was spun out of UCLouvain in Belgium.