Team managing the impact VC fund for Paris-based MAIF Avenir have joined Capital Croissance, a French private equity investment platform and entrepreneurs club, and renamed to Ternel.
The team managing a €150m impact VC fund for Paris-based MAIF Avenir, the venture capital arm of French insurer MAIF, have joined Capital Croissance, a French private equity investment platform and entrepreneurs club and renamed to Ternel. The news of the team’s transfer and rebrand came as the company announced the launch of a second €120m fund.
The new fund, named Ternel II, will invest in 30 European start-ups, mainly at the seed to series A stage, with an investment thesis centered on the regenerative economy.
Mohamed Abdesslam, managing partner at Ternel, told Impact Investor his team would start fundraising towards the end of the year and hoped to attract both institutional investors, such as banks, insurers and family offices, as well as private investors from among the 450 plus entrepreneurs that belong to Capital Croissance’s entrepreneurs club.
Abdesslam said that MAIF, as the sole investor in the existing fund, which has been renamed to Ternel I, had already committed to invest 25% of the value of the new fund, between €25 and €30m.
He explained that in the interim, with a residual investment capacity in Ternel I of €20m for new investments and €20m for reinvestment into existing holdings, his team would focus on completing investments in the first fund. This, he said, would include adding seven new portfolio companies on top of the existing 28 in the fund, targeting the themes of climate tech, future of work, digital health, responsible consumption and ethical data.
The addition of the Ternel team and the Ternel I fund increases Capital Croissance’s assets under management to €950m.
Bringing private equity and venture capital closer together
Abdesslam said the purpose of Capital Croissance was “to raise money from entrepreneurs for entrepreneurs” but that both impact and venture capital (VC) had been missing from the platform’s business activities.
“When we started talking with them two years ago, they didn’t have impact or a VC on board, so our proposition was very complementary,” he said.
“At the same time, joining Capital Croissance brought us three benefits; access to a large investor pool of limited partners, access to back office functions, a middle office and resources such as branding as well as expert advice for our portfolio companies, and last but not least, improved liquidity.”
Abdesslam said he believed that the search for liquidity more broadly would see the areas of private equity and VC converge in the future.
“Our conviction is that the search for greater liquidity will see VCs seek to work more closely with private equity funds in the future.”
Last year, Capital Croissance announced the launch of the Gaia Energy Impact Fund II in partnership with Gaia Impact, a French impact investment advisory firm, and other partners, targeting investments in the decentralised and renewable energy value chain. Ternal and Gaia Impact now constitute the private equity platform’s impact VC business arm, in addition to its buy-out and growth capital business arm and a fund of funds and co-investment business arm which it manages with other partners.
Regenerative risk-capital
Ternel II, whose investment thesis is based on the principles of the regenerative economy, will target companies and technologies responding to the challenges of climate change, biodiversity, circularity and waste, health, land and natural resource management, the provision and promotion of decent work, and governance and distribution of value, with ticket sizes ranging from €500,000 to €5m.
Abdesslam said: “With Ternel, we are initiating a new phase in our approach to impact venture capital, adopting a viewpoint inspired by regenerative businesses. Our goal is to support organisations determined to restore balance in our world, without needing to compromise between financial performance and environmental impact, between economic growth and social cohesion.”
Ternel said it had developed what it called a ‘regenerative framework’ to measure impact and economic performance and had a ‘regenerative advisory board’ in place that would oversee the fund’s regenerative mission and provide support to its investee companies.
Highlighting what he called the “real shortcomings” of VC investment in terms of the environment, including backing energy intensive technology; social issues, such as the lack of inclusiveness and diversity, and “human issues related to the lack of digital accessibility, data ethics and algorithmic bias”, Abdesslam said: “The response offered by some [VCs] is still very siloed – limited to a CO2 focus or a thematic focus – or far from a modern discourse on performance.”
“We have been working in the European impact ecosystem for over 10 years, and wanted to create a VC that could maximise the positive contribution of the start-ups it supports and give each of them the means to regenerate the ecosystems around them, strike a balance between all stakeholders, and support models where positive impact and performance feed off each other.”
