Funds Seeking to Tackle Plastic Wastes Attracting Investors

Date: June 23, 2021

Source: News Room

Circulate Capital (Singapore) and Closed Loop Partners (New York) are raising capital, including from large companies, to back investments working to reduce and recycle plastic waste. They are among a small but growing number of firms investing in companies that contribute to the circular economy, a business model that seeks to eliminate waste that organizations produce, continuously reuse products and materials and regenerate natural systems.

There are an estimated 30 private-market funds, including private-equity, venture and debt strategies focused on the circular economy in the first half of 2020, up from just three in 2016, according to a report last year from the non-profit Ellen MacArthur Foundation.

Closed Loop, which managed around $164 million in regulatory assets at the end of 2020, invests across private-equity, venture capital, debt and infrastructure funds. Circulate, founded in 2017, in 2019 raised $106 million for its Circulate Capital Ocean Fund, backed by a handful of large multinational corporations that include Coca-Cola Co., Danone SA, Procter & Gamble Co. and Unilever PLC.

Unilever, which has backed funds managed by Circulate and Closed Loop Partners, aims to cut in half the amount of virgin plastic it uses by 2025 and plans to collect and process more plastic packaging than it sells. Coca-Cola, also a backer of Circulate's Ocean fund, aims to make all of its global packaging recyclable by 2025 and to use at least 50% of recycled packaging material by 2030, among other goals.

Closed Loop is currently pitching investors on several funds, including the Closed Loop Circular Plastic Fund, which targets recycling technologies, equipment and infrastructure deals across North America. aims to grow the fund to $100 million, according to a press release.

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