Ecosia launches World Fund to back climate tech founders

Ecosia, the search engine that uses its ad revenue to plant trees, has launched a 350 million euro ($405 million) venture capital fund focused on the climate crisis.

The so-called World Fund will invest in the “next generation” of founders looking to tackle the issue, Ecosia said, and will measure its success on “climate returns” as well as financial returns.

“Our goal is to solve climate change,” Ecosia CEO Christian Kroll told CNBC ahead of the launch on Tuesday, just days before the COP26 climate summit.

“We’ve been doing that at Ecosia for a long time by planting trees,” Kroll said, adding that the company has planted 136 million trees so far. “But that alone won’t be enough to solve climate change.”

Research published Tuesday shows that climate tech start-ups have raised more money so far this year than they have in any other year, with $32 billion pumped into start-ups tackling climate change around the world since the start of 2021.

The Ecosia search engine has 15 million monthly active users and it expects to report annual revenues of 25 million euros ($29 million) this year. The size of its user base pales in comparison to Google, however, which has billions of users.

Kroll said Ecosia is “extremely well connected to a lot of climate start-ups” but it’s unable to support them with the money it’s generating through its search engine.

“Our promise to our users is that if you search with us we use the money for tree planting,” he said. “If we were to put that into risky start-ups and it then doesn’t work out then it wouldn’t be so well received.”

He hopes that setting up a separate VC fund that raises capital from alternative sources will help to eliminate this issue.

Bill Gates, the billionaire co-founder of Microsoft, said in an interview that aired Wednesday that climate tech will produce eight to 10 Teslas, a Google, an Amazon and a Microsoft. The people at Ecosia have a similar view, believing that the most valuable companies of the next decade will be those enabling a decarbonized world.