Europe’s climate tech ecosystem is booming, but a lack of growth capital is keeping innovative startups from scaling.
Some 28% of European venture investments go to deep tech startups addressing critical challenges, yet just 3% of those companies successfully raise Series B or C rounds. At the crucial Series B stage, where startups move from prototype to scale, European founders are often forced to seek capital outside of the 27-nation bloc.
Kembara, a deep tech and climate growth fund managed by Spanish venture capital firm Mundi Ventures, is looking to address the funding gap.
Kembara last week announced a €750 million ($892 million) first close towards a €1 billion ($1.3 billion) target it hopes to clinch within nine months, Yann de Vries, Kembara’s co-founder and general partner, told ImpactAlpha. The fund, which was anchored by a €350 million ($417 million) commitment last year from the European Investment Fund, drew investments from European sovereign wealth funds, large foundations, banks and corporations.
With the convergence of AI, quantum computing, robotics and synthetic biology, Europe finds itself at “a tipping point,” De Vries said. “There are major waves of innovation that are all coming together, and they are accelerating innovation like never seen before. This will have a massive impact on our daily life, on our economies and on our geopolitics.”
Kembara will target Series B and C rounds, investing from €15 million ($18 million) to €40 million ($48 million) in 20 promising companies active in AI, advanced computing, robotics, clean energy and sustainability, advanced materials, space and dual-use defense technologies. Total investment could rise to €100 million ($119 million) per company.
Deep tech renaissance
Series B is “the sweet spot,” De Vries said, with companies already in early product development and ready to scale. “If a company does well, you can almost triple the valuation.”
“Europe is at the beginning of a second Renaissance,” said Javier Santiso, Mundi Ventures CEO and founder of Kembara. “The original [Renaissance] had the Medici family to fund innovation; similarly Europe’s deep tech champions today also need significant local growth-stage capital at scale.”
European climate tech startups faced a Series B funding shortfall of $13.5 billion between 2020 and 2024, according to a 2025 report by German VC World Fund. This deficit may jeopardize not only the European economy but also its sovereignty and resilience, World Fund warned.
Deep tech is “where the biggest problems are going to be solved. This is where the biggest returns are going to be made. And this is where sovereignty is also going to be decided, because Europe has finally realized that they are not in control of these core technologies,” De Vries said.
