GREEN GROWTH FUND 2 (GGF2)
GGF2 is targeting best-in-class energy and resource-efficient companies in the EU that make a real difference economically and environmentally and actively supports them to grow globally. Our approach is highly profitable, investing into surging growth markets, providing the basis for the strong financial returns investors can expect from this fund. Our target companies are in the growth or early growth stage. They will have a proven technology and typically a proven business model which they will look to expand globally. We will invest typically between €5m – €30m across several rounds and usually hold a minority position with strong contractual controlling, veto and exit rights. We plan to have a portfolio of 12-15 companies where we typically take a lead investor role either on our own or together with other investors, which ideally should also bring strategic value to the portfolio companies e.g. by having ties in key markets. Our portfolio companies will be based in the EU, typically within two hours of travel from Berlin in Germany or Scandinavia, where we have an established network and relationships. Moreover, they should have the ability and ambition to grow globally. This region also is among the most advanced globally in terms of energy-, transport- and agrarian transition which is currently underway in the global “green industrial revolution” and thus we are likely to find global champions in this new industrial revolution in this region.
The financial objective for the portfolio is to deliver a gross return of 3x on the company level. Some companies are expected to deliver considerably higher returns while some may fail. On top of that, all companies need to deliver a real environmental impact; in most cases a reduction of CO2 emissions. On an overall fund level, the aim is to deliver investors a financial return of more than 20% per annum, a multiple on capital called of more than 2x and a net positive environmental impact.
Over the past decade, WAM has developed several investment strategies in relation to listed assets (equities and bonds), addressing the opportunities and risks of the green industrial revolution. These strategies have been tested via investments by the family office via its long-term investment vehicle “REEF”. Subject to raising about €50m of seed capital for each strategy, they could be made available to professional investors as hedge funds or to the public as mutual or “UCITS” funds. This would be desirable as it would contribute to the “democratization” of “impact investing” and “divest-invest” strategies. We thus welcome offers or leads to raise the required seed capital.
The Climate Endowment funds follow a dual bottom-line investment strategy of achieving both sustainable long-term financial returns & reduction of 1% of current global CO₂-emissions over 30 years. By applying the endowment model similar to the large US university endowments, we seek to capture the illiquidity premium by investing (>60%) in illiquid alternative asset classes. The aim is to build a highly diversified portfolio leading to an attractive risk-return-impact profile: diversified across private/public asset classes, debt/equity capital structures, industries, and countries. The Climate Endowment team consists of experienced investors, entrepreneurs and technology experts who assess, select and manage investment risks well to ensure solid returns.