Morning Richard,

Last week, we reported that Bill Gates had flown to Berlin to discuss Germany’s climate tech future. At the event, which was attended by politicians, startup founders and state banks, Gates spoke about his experience funding capital-intensive climate technologies in the US. 

Gates’ approach to climate tech is three-fold. There’s the Breakthrough Energy Fellows programme, a two-year initiative to help early-stage founders develop their technologies. Then there’s Breakthrough Energy Ventures, a VC fund. Last, there’s Breakthrough Energy Catalyst, an investment platform which funds large demonstration projects and FOAKs (first-of-a-kind projects). The VC arm, Breakthrough Energy Ventures, raised a new $555m fund in January. Scroll on to see the European companies it has backed.

Elsewhere, I was at Cleantech Capital Day in Helsinki this week, where there was lots of discussion about how different parts of the capital stack can edge closer together to fill in the funding gaps for infrastructure startups. Commercial banks are yet to get comfortable with the emerging asset class — and there were questions on whether state banks can step further into the fold. In today’s newsletter, we’ve got the latest stats on debt financing in the Nordics — which saw a major ramp up in Q1.

But! Before you scroll on, if you’re a woman working at a startup or scaleup, please take our latest reader survey. We want to learn more about women's workplace experiences in the startup ecosystem — and will share our findings soon. It’s entirely anonymous.

— Freya Pratty, senior reporter

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The Gates-backed European companies

Breakthrough announced a new $555m fund in January. It’s since invested in two European companies, bringing its portfolio on the continent to nine.

Mission Zero

UK-based Mission Zero builds direct air capture machines, which remove carbon from the air. Breakthrough led the company’s seed round in 2020 and followed on in its £21.8m Series A earlier this year.

Heart Aerospace

Swedish electric plane startup Heart Aerospace secured backing from Breakthrough earlier this year, in its $107m Series B round. The company hopes to get its plane in the air by 2028. 

Blue World Technologies

Blue World develops methanol fuel cells for the automotive industry. Breakthrough backed the company in its €37m Series B round in 2022.

Dioxycle

Paris-based Dioxycle has developed a system that turns carbon dioxide into chemicals such as ethylene, which is used widely in the production of textiles and plastics. Breakthrough backed the company in July 2023, in a $17m Series A, alongside Lowercarbon Capital.

H2site

H2site builds tech that can produce hydrogen on site for businesses that need it as a fuel. Breakthrough participated in the company’s Series A round in 2022. 

Reactive Technologies

London’s Reactive Technologies is working on electricity grid stabilisation tools. It received backing from Breakthrough in a $15m raise in 2021.

44.01

44.01 is working on using rocks to capture carbon dioxide from the air. The process accelerates a natural mineralisation reaction. 44.01, which is working on its tech in Oman, secured backing from Breakthrough in 2021 as part of its seed round.  

Bloom Biorenewables

Bloom Biorenewables uses natural materials found in biomass to create cost-competitive products as an alternative to petroleum. Its tech can extract valuable chemicals from biomass waste and convert them into sustainable packaging solutions. Breakthrough backed the company in 2021, in its €3.9m seed round.

Quell Therapeutics

One of Breakthrough’s healthtech investments, Quell engineers regulatory T-cells which can help fight disease, to boost patient immune systems. The company, which has secured a partnership with AstraZeneca, received backing from Breakthrough in its $156m Series B round in 2021.

Find more details on the companies here, along with the European startups backed by Gates' other vehicle, the Bill and Melinda Gates Foundation.

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Nordic climate tech needs €15bn

A new report compiled by Tesi, a Finland-based investment company, estimates the Nordic climate tech ecosystem needs to raise €15bn over the next five years. The figure is based on the number of companies at each growth stage and historical funding rounds.

The same study also estimates Nordic VC and PE investors with climate tech mandates have €6bn in their coffers to invest over the next five years.

“Few Nordic investors have the resources to finance the largest growth leaps, so the role of European and global investors are particularly essential, especially in later funding rounds,” says Jakob Sandell, research manager at Tesi.

Elsewhere, a new study from Cleantech for Nordics shows the increasingly pivotal role debt financing is taking in the region. In the first quarter of 2024, the total amount of debt secured by climate companies in the Nordics surpassed the figure for the entirety of 2023.

B2B SaaS: Here’s how to avoid the chopping block

In a challenging economic climate, where companies are scrutinizing their spend, SaaS tools are often the first to be cut back. Our latest report offers invaluable insights from Europe’s software masters on not just surviving, but thriving, amidst the current market lull. 

German battery recycling startup Cylib raised €55m in a Series A funding round led by European climate tech VC World Fund and Porsche Ventures, the venture arm of the sports car manufacturer. Bosch Ventures, Germany’s €1bn deeptech and climate tech fund (DTCF) and NRW.Venture participated along with existing investors Vsquared Ventures, Speedinvest and 10x Founders.

• The all-equity deal will enable Cylib — which recycles lithium-ion batteries — to start scaling its technology at an already-secured brownfield industrial facility in Germany, near Aachen, where the company is based.

Enspired, a Vienna-based company which helps owners of energy storage assets — such as battery facilities — to sell on their power capacity, has secured a €25.5m Series B round. The round shows that as more renewables are hooked up to the electricity grid, investors are cottoning on to the opportunity around the energy storage market. 

Zurich-based 8inks, which has developed coating technology for lithium-ion battery production to reduce battery production costs, raised €3m in pre-seed funding. Founderful led the round and was joined by investors including Übermorgen Ventures.

Berlin-based hexafarms, which develops software for indoor commercial food production, raised €1.3m in pre-seed funding. Speedinvest led the round and was joined by investors including Mudcake and Techstars.