Backing startups across the UK that are looking to launch tech solutions tackling the biggest industry problems while maintaining a climate focus, Elbow Beach, the climate impact seed investor has achieved the first close of its second fund valued at £63million.
Through its Enterprise Capital Funds programme, the British Business Bank, the British state-owned economic development bank, contributed £50million to this fund. Over the next four years, Elbow Beach will use this fund to accelerate the scaleup, development and export potential of some of the nation’s best early-stage technologies. £40million of the fund will be available for immediate deployment.
Jon Pollock, Elbow Beach CEO and managing partner, said: “Elbow Beach is on a mission to ensure Britain remains a global leader in climate technology innovation, and we’re going to help support the next generation of founders who are driving real transformational change.
“The UK has a huge advantage in the development of new technologies that help to deliver better outcomes for customers through cheaper, more secure or higher performance solutions which are also decarbonising. We’re really looking forward to working with the British Business Bank’s team to deploy this fund and partner with brilliant entrepreneurs providing customers with better, more cost-effective solutions at scale.
“The backing from the British Business Bank is a real vote of confidence in Elbow Beach’s investment strategy and in Britain’s entrepreneurs.”
The fund’s overarching objective is to back technologies that will make a meaningful impact by solving big problems, enabling industries to become more efficient and cost-effective while transitioning to low-carbon operations. Its strategy includes investment in automation and AI, carbon capture, electrification, and low-carbon materials. The fund will primarily seek to back climate tech companies, including university spinouts and companies that have received Innovate UK grant funding.
British Business Bank’s contribution
The British Business Bank’s Enterprise Capital Funds programme is key in helping to develop and maintain effective venture capital provision in the UK, lowering the barriers to entry for emerging fund managers. The programme has backed 47 funds, representing more than £2.3billion of finance and helps those fund managers specifically targeting early-stage businesses with long-term growth potential.
Christine Hockley, managing director and co-head of funds, British Business Bank, said: “We are pleased to make this commitment to Elbow Beach as they back startups pioneering technology solutions to global climate challenges. Our Enterprise Capital Funds programme is key in helping to develop and maintain effective venture capital provision in the UK, lowering the barriers to entry for emerging fund managers.
“Our commitment to Elbow Beach builds on the programme’s track record and will help early-stage founders in the climate impact sector across the UK to build their businesses.”
Mark Sims, senior director, funds, British Business Bank, said: “Hardware climate tech companies at pre-revenue level experience an equity gap in the UK due to the lack of venture capital investors with the right expertise to evaluate them. Furthermore, continued innovation is required to tackle the significant challenges of climate change. By committing to Elbow Beach’s Climate Impact Fund, we are filling this equity gap whilst backing high growth climate tech companies that are developing the technologies required to help the UK achieve Net Zero.”
