On Thursday, global venture capital investor Energize Ventures announced that it is joining one of Canada’s largest institutional investors, the $290 billion (or thereabouts, in U.S. greenbacks) alternative assets giant Caisse de dépot et placement du Québec (CDPQ), on a new co-investment partnership. Under terms of the partnership, CDPQ will commit up to $125 million over the next three years in ventures devoted to accelerating the digital transformation of energy and sustainable industry verticals.
They’re already good friends
The co-investment deal expands CDPQ’s existing relationship with Energize Ventures. CDPQ is a Limited Partner in Energize Ventures I, and an anchor Limited Partner in Energize Ventures II.
As part of this agreement, Energize and CDPQ will share industry knowledge around climate and sustainable investments, emphasizing digital innovations that advance the energy transition. Examples of aligned investment focus areas include technologies aimed at addressing climate change, electrifying mobility, accelerating the deployment and adoption of renewable energy, and more.
“The energy transition is accelerating even faster than our predictions,” said John Tough, managing partner of Energize Ventures. “With this change comes a tremendous opportunity for innovative companies serving critical infrastructure, mobility, renewables and other sustainable industries to emerge and capture outsized market share. As a leading institutional investor with deep expertise and reach in the sustainability space, CDPQ is the ideal partner to invest alongside us in digital solutions that accelerate this critical transformation.”
“As part of its long-standing commitment to invest in solutions that address climate change, CDPQ is leveraging opportunities with strategic partners to direct more capital towards innovative investments and sustainability initiatives,” said Mario Therrien, Head of Investment Funds and External Management at CDPQ. “We selected Energize as our partner because they have demonstrated an ability to identify leading energy investments while also supporting a cleaner and durable future.”
Since 2017, CDPQ has committed to reducing its portfolio’s carbon footprint by 25 percent per dollar invested by 2025. By doing so, CDPQ became the first institutional investor in North America to set a greenhouse gas intensity reduction target covering all its asset classes. Climate is now factored into all its investment decisions, affording it an essential position to make its portfolio more sustainable. Over the last two years, CDPQ’s portfolio of low-carbon assets has increased 95 percent, to $34 billion.
Portfolio hits
Energize Ventures invests in digital technologies that accelerate the sustainable transition of energy and industry, with a focus on software and business model innovations. Energize Fund I has invested nearly $200 million across 14 companies to date. Portfolio companies include climate risk analytics firm Jupiter, localized autonomous vehicle maker Optimus Ride, drone management platform DroneDeploy, and the largest free electric car charging network in the U.S., Volta Charging. Energize Ventures invests at the Series A, B and C stages, preferring to lead investment rounds, with initial bite sizes of $5-15 million.
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