Transition VC Launches New Fund for Energy Transition Startups

Transition VC, a venture capital firm concentrating on energy transition, has initiated its second fund with a target size of Rs 1,500 crore (approximately $150 million), significantly expanding its initial fund size, which closed at Rs 700 crore. The Bengaluru-based firm confirmed the final closure of its first fund at Rs 700 crore (around $77 million) in December last year, surpassing its original target of Rs 400 crore. The fund received backing from a variety of institutional investors, corporate entities, family offices, strategic partners, and industry experts.

Investment Plans for Fund II

Fund II aims to invest in 20 to 23 hardware and deep-tech startups along the energy demand and supply value chain, with investment amounts ranging from $2 million to $5 million. Transition VC noted that Fund I has achieved a 57% internal rate of return (IRR) and has provided over 3X multiple on invested capital (MOIC) within three years.

Successful Track Record with Fund I

Through Fund I, Transition VC supported 17 startups, including CIMware, Comminent, Matel, EMO, Hydgen, Dynolt, and Promethean, and has plans to develop a portfolio of up to 25 companies. With the new Fund II, the firm will persist in its focus on energy transition startups while also broadening its interests to advanced manufacturing and application engineering.

Exploring New Opportunities

The firm will also consider investments in semiconductors, nuclear energy, geothermal technologies, and next-generation energy infrastructure, specifically targeting startups that demonstrate proven technical viability and early commercial success.

The fund’s launch aligns with increasing investor enthusiasm for industrial deep-tech and climate technologies. Over the past year, multiple investment firms have introduced dedicated funds aimed at supporting startups focused on clean energy, decarbonisation, and advanced manufacturing technologies.

Co-founded by Raiyaan Shingati and Mohammed Shoeb Al, Transition VC invests in early-stage engineering-led startups across electrification, energy storage, industrial decarbonisation, alternative fuels, and next-generation manufacturing.