Sarmayacar Launches $40 Million Climaventures Fund to Tackle Pakistan’s Climate Crisis

Sarmayacar Launches $40 Million Climaventures Fund

Lahore, Pakistan – Sarmayacar, a Lahore-based venture capital firm, has today announced the launch of its Sarmayacar Climaventures Fund, a groundbreaking initiative aimed at addressing Pakistan’s climate emergency. The fund, which has secured $15 million in anchor funding from the Green Climate Fund, will invest in local ventures offering scalable and impactful solutions to the country’s growing climate challenges. The total target for the fund is $40 million.

The Green Climate Fund, a global initiative established by the United Nations to help developing countries reduce greenhouse gas emissions and adapt to climate change, is backing this ambitious project, which aims to drive innovation in critical areas such as energy generation and transition, e-mobility, water and waste treatment, recycling, and agritech.

Rabeel Warraich, CEO and founder of Sarmayacar, emphasized the urgency of the situation, pointing to the devastating floods of 2022 that claimed over 1,700 lives and caused nearly $15 billion in damages. “Addressing Pakistan’s climate emergency requires an approach that fosters entrepreneurial innovation,” Warraich said. “Our fund will back founders who are building localized, scalable climate solutions for the country. We hope to spawn an entire climate venture ecosystem by leveraging our experience and connectivity both in the country and beyond.”

The Sarmayacar Climaventures Fund is the first domestic venture capital initiative in Pakistan to adopt a thematic approach focused exclusively on climate change. Warraich revealed that the firm has already identified a pool of around 200 potential companies, with plans to back approximately 15 to 20 businesses through the fund.

A Catalyst for Broader Investment

Warraich acknowledged that the $40 million target is only a fraction of what is required to address Pakistan’s climate challenges but believes the fund will act as a catalyst to attract significantly larger investments from other players, both domestic and international. “We recognize that $40 million is not going to be anywhere near enough to address Pakistan’s climate change needs,” he noted. “But we can be the catalyst that unlocks much greater sums for businesses with a role to play.”

Indeed, there is significant global interest in climate finance, with the Climate Policy Initiative’s Global Landscape of Climate Finance 2023 report revealing that global climate finance doubled to $1.27 trillion in the past year. However, much of this funding does not reach developing markets like Pakistan, despite their acute vulnerability. Pakistan ranks as the eighth most climate-vulnerable country in the world, according to the Global Climate Risk Index.

Sarmayacar’s Track Record of Success

Sarmayacar is no stranger to pioneering efforts in Pakistan’s venture capital space. The firm launched Pakistan’s first venture capital fund in 2018, a $25 million initiative anchored by the International Finance Corporation. That fund has since catalyzed more than $800 million in investments into Pakistani startups and scale-ups across sectors such as fintech, e-commerce, healthtech, and logistics. Warraich believes the Sarmayacar Climaventures Fund can have a similar multiplier effect in the climate space.

A Focus on Inclusivity and Diversity

In addition to tackling climate change, the Climaventures Fund is also committed to promoting diversity and inclusivity. “We are committed to fostering inclusivity within our investments by supporting women-led ventures and initiatives that promote diversity in entrepreneurship,” Warraich said. He added that the fund aims to create a vibrant ecosystem of entrepreneurs, industry leaders, experts, and investors through networking events, collaborative projects, mentorship, and operational support.

A Call for Global Participation

As the fund builds on its initial backing from the Green Climate Fund, Sarmayacar will be seeking additional investments from development finance institutions, international climate-focused private equity and venture capital funds, as well as family offices and endowments with a mandate for impactful investments.

With climate change posing an existential threat to Pakistan, the Sarmayacar Climaventures Fund represents a significant step forward in the country’s efforts to combat this growing crisis. By supporting homegrown solutions and fostering entrepreneurial innovation, the fund aims to position Pakistan at the forefront of climate action in the developing world.

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