Singapore-based circular economy investment management firm Circulate Capital has achieved $220 million in the first close of its second climate fund.
The first close represents more than 70% of its $300-million targeted fund size, according to an announcement.
Returning LPs include The Coca-Cola Company, Danone, Dow, Procter & Gamble, British International Investment, Proparco, International Finance Corporation (IFC), and family office Builders Vision.
New allocators to join the fund include the Emerging Markets Climate Action Fund, co-managed by Allianz Global Investors and the European Investment Bank; Dutch pension fund through Achmea Investment Management’s Impact Platform; Impact Fund Denmark; SIFEM and Australian Development Investments; along with family offices and impact investors, including Stella (the investment entity of the Heinz Hermann Thiele family foundation); Clotho Family Office, Netherlands-based impact specialist Wire Group; and Fondation Prince Albert II de Monaco.
Circular Capital’s first fund raised $188 million.
The firm has started deployment from the second fund into circular supply chains and recycling solutions across South and Southeast Asia, with a focus on plastic solutions and packaging, as well as electronics and apparel.
Key markets include India, Indonesia, Thailand, Vietnam, the Philippines, and Malaysia.
Circular supply chains have moved from a niche sustainability theme to a strategic priority, driven by tightening regulation, ongoing supply chain disruptions, and consumer brand commitments. The global economy consumes more than 100 billion tonnes of raw materials each year, yet only 7.2% is recirculated, leaving supply chains vulnerable to both price swings and material scarcity.
Circular Capital said that plastics alone represent a $100-billion opportunity for cumulative investment in collection and recycling infrastructure by 2030.
“Building circular supply chains takes long-term commitment and strong collaboration across the value chain. scaling inclusive recycling systems is essential to keep materials in use, strengthen local ecosystems, and build more resilient supply chains,” said Jean-Yves Krummenacher, Global Chief Procurement Officer at Danone, one of the existing LPs.
Rob Kaplan, Founder and CEO of Circulate Capital, added that the circular economy “is a sophisticated asset class” that can deliver liquidity to private equity investors.
Since 2020, the firm has added nearly 900,000 tonnes of annual collection and recycling capacity across its Asia portfolio.
Fund I has recently sold Recykal, an India-based digital waste management platform. The firm also completed partial exits from plastic packaging recycler Lucro and food-grade plastic recycling firm Srichakra Polyplast.
Looking ahead, the second fund aims to finance close to two million tonnes of collection and recycling capacity. Over a ten-year horizon, these investments are expected to prevent a cumulative 30 million tonnes of unmanaged waste; avoid or reduce more than 50 million tonnes of CO2 emissions, with at least 50% of the portfolio aligned to 2x gender smart investing targets on exit.
