The UK Infrastructure Bank (UKIB) has pledged up to £50 million ($64 mln) to a first-of-its-kind venture capital fund seeking to create and scale businesses that harness nature and climate solutions developed by British research institutes.
Launched in Nov. 2023 by the London-headquartered investor Greensphere Capital, the Gaia Sciences Innovation fund will collaborate with over 4,000 researchers from the University of York, the Sainsbury Laboratory, the Royal Botanic Gardens, and the University of East Anglia, among others.
“We need to scale investment in natural capital if it is going to deliver on its net zero promise in the UK. This deal will help,” said John Flint, CEO of the UKIB.
“Our funding will support the commercialisation of the science, data, and technology, which is so crucial. This will, in turn, generate investor confidence, creating opportunities for nature investment, while also boosting skills and innovation in a nascent green sector.”
UKIB’s financing will be conditioned upon the amount of private sector investor commitments, the British state-owned development bank said in a statement.
An additional £15 mln investment was announced by Franks Mars, board member of the family-owned food giant, who will join the fund’s advisory committee as a chair, while Greensphere allocated £1.3 mln.
The investor – which has £200 mln in assets under management – aims to raise $150 mln for the fund.
“Our primary objective is to create value for our investors and partner institutes,” said Divya Seshamani, managing partner of Greensphere Capital.
“We are honoured to work with some of the most knowledgeable investors in the market, like the UK Infrastructure Bank and the Mars family, who are aligned with our values of people, planet, and profit.”
UNLOCKING FINANCING
The Gaia Sciences Innovation Fund said it will invest in innovative solutions that enhance land and water-based ecosystems, including natural pest control, green fertilisers, and products for soil health improvement.
As well, it will support initiatives that ease pressures on ecosystems, including the development of alternatives that displace drivers of deforestation, such as meat, dairy, and palm oil.
Green fintech will also play a critical role, with the fund eyeing investments in technologies to measure, monitor, and verify biodiversity and climate impacts.
That includes environmental DNA (eDNA) collection and sequencing, sensors for tracking water and soil health, computational genetics, and AI for assessing climate and nature-related risks.
Recently, technology-driven assessments have emerged as a key means to unlock resources towards nature conservation and restoration, and help close the biodiversity financing gap.
Bridging this gap is widely regarded as one of the top priorities for meeting the Kunming-Montreal Global Biodiversity Framework target to protect 30% of land and sea by 2030.
The UN Environment Programme estimated that harmful funding to nature amounts to $7 trillion annually, whereas funding with a positive impact in 2022 reached only $200 billion.
According to a separate study, the UK alone should ramp up funding towards biodiversity by at least £44 bln.
By Sergio Colombo – sergio@carbon-pulse.com
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