If you want to solve climate change, there are few better places to start than cities. Jacob Bro, co-founder and partner at 2150, describes the city as a beautiful vampire squid that sucks in all resources. Cities aggregate an estimated 80% of global prosperity and GDP, but they also account for 70% of emissions, along with the majority of waste and other downsides of modern life.
Many investors have raised large funds to tackle climate change, measuring success by financial returns and carbon reductions. 2150 does the same, but it begins by looking specifically at the problems and opportunities within cities to find fertile ground for investments. By examining everything we consume and build to make urban centers operate, you can identify the key technologies and bottlenecks. Bro argues that sustainability, when done well, is simply better business—it is cheaper, faster, and more independent from geopolitics.
This dual focus has helped 2150 raise a new second fund of €210 million. The capital comes from a range of institutional investors and family funds, including Chr. Augustinus Fabrikker, Church Pension Group, the Danish sovereign fund EIFO, Fund of Funds Carbon Equity, Novo Holdings, Islandbridge Capital, Security Trading Oy, and Viessmann Generations Group. This new fund brings the European firm’s total assets under management to €500 million. The fund has 34 limited partners in total.
So far, 2150 has invested in seven companies from the new fund. These include AtmosZero, which makes industrial heat pumps; GetMobil, an e-waste recycling startup; Metycle, a scrap and recyclable metals marketplace; and MissionZero, a direct air capture startup. Three other investments have yet to be announced. In total, the firm plans to invest in 20 companies from this second fund. Most startups will be raising Series A rounds, with initial checks totaling around €5 million to €6 million. Half of the fund will be reserved for follow-on investments.
The partners plan to look for a range of startups, similar to their previous strategy. They are particularly excited by opportunities in data centers and automation, areas spurred by the recent surge in AI. However, they see AI as more than just an energy investment opportunity. The impact is also societal. Europe is expected to lose 100 million people by 2040 due to an aging population, with countries like the Netherlands already having half their population over age 50. Industrial automation can help maintain productivity, generate GDP, and fund pensions for this demographic.
Bro notes that a focus on industrial applications is logical, as cities are ultimately supplied by industries of all sizes. This focus appears to be paying off. According to Hernandez, 2150’s portfolio companies mitigated one megaton of carbon emissions last year. The fact that a small venture capital fund can achieve that scale of impact in just four years, alongside commercial traction, confirms they are on the right path.