Green Fund

SmartCap Green Fund is on a mission to supercharge the supply of venture capital to Estonian Greentech companies

SmartCap Green Fund’s principal objective is to contribute to development and adoption of innovative green technologies by investing in innovative and/or research-intensive green technology companies and infrastructure projects through venture capital funds and private equity funds with infrastructure strategy. For this purpose, investments shall be made into funds to diversify the availability of equity capital that drives the future of sustainable innovation and resilience, also to promote the environmental objectives provided in EU Taxonomy for sustainable activities

SmartCap Green Fund will focus its fund investments to back venture capital and private equity fund managers with a strong focus on innovative early-stage, later-stage or infrastructure companies and projects.

SmartCap intends to invest in already operating or soon to be established investment funds, to which SmartCap Green Fund would make an investment within the range of €5 to €30 million per fund.

Specific requirements and restrictions for the funds:

SmartCap seeks to invest in venture capital and private equity funds with infrastructure strategy that aligns with our mission and demonstrates a clear commitment to advancing Estonian greentech ecosystem.

  • Already operating or soon to be established venture capital or private equity fund with a significant focus on innovative and/or research-intensive green technologies or infrastructure companies. The closing of the fund where SmartCap Green Fund commits to invest must take place before mid-2026.
  • The fund shall primarily invest in equity and quasi-equity instruments.
  • The fund manager shall demonstrate their contribution and value-add of their investment strategy to Estonian green transition. The fund shall invest at least SmartCap Green Fund’s investment amount into Estonian greentech companies or infrastructure projects that contribute to at least one of the environmental objectives provided in EU Taxonomy for sustainable activities.
  • No state aid is provided by SmartCap. SmartCap Green Fund invests pari passu with independent private investors, requiring that at least 30% must be invested by independent private investors at the same time and under the same terms as SmartCap Green Fund.

Sustainability Alignment

The investment into Estonian greentech companies or infrastructure projects shall contribute to at least one of the environmental objectives provided in EU Taxonomy for sustainable activities:

  • Climate change mitigation and adaptation;
  • Water resource protection;
  • Circular economy initiatives;
  • Pollution prevention and reduction;
  • Biodiversity and ecosystem restoration.

Additionally, these investments must comply with the “Do No Significant Harm” (DNSH) Technical Guidance (2021/C58/01), ensuring that financed activities do not negatively impact environmental objectives.

Funds and their managers that fit the mandate of the SmartCap Green Fund will be assessed throughout the investment process as SmartCap considers, among other elements, the following aspects:

  • Team composition and profile: track record, joint working experience, relevant expertise and experience, competencies, and capacity.
  • Investment strategy: validity and viability, including relevance to SmartCap Green Fund objectives and consistency with the fund manager team’s profile, competitive advantage, model portfolio, potential value-add to portfolio companies, deal sourcing and existing pipeline.
  • Fund terms and conditions: legal and organisational structure, viability and sustainability of the fund manager and fundraising status and outlook.

SmartCap Green Fund shall remain open until mid-2026 as long as it has uncommitted resources available that are allocated for fund investments, however, investments will be made only in funds that hold at least their initial closing before mid-2026.

SmartCap may amend the investment terms at any time and reserves the right, at its sole discretion, to cancel or discontinue SmartCap Green Fund’s investments in venture capital and infrastructure funds in its entirety at any time.

See our Investment Process and Responsible Investing sections, to learn more about our approach to investing.

If you think your fund is a fit, get in touch.

SmartCap Green Fund is financed by the European Union NextGenerationEU Recovery and Resilience Facility funds.