Avaana Capital closes $135 million climate fund, targets early-stage start-ups

Avaana Capital, one of India’s leading climate-focused venture capital firms, has announced the final close of its Avaana Climate and Sustainability Fund at $135 million.

The Avaana Climate and Sustainability Fund targets early-stage start-ups, leveraging technology to develop scalable solutions for climate mitigation, adaptation, and resilience—essential to India’s net-zero journey. The fund focuses on three key sectors responsible for 90% of India’s carbon emissions: energy and resource management, mobility and supply chains, and sustainable agriculture and food systems.

The fund has garnered strong backing from prominent institutional investors, notably the Green Climate Fund (GCF) in its first direct investment in India, underscoring the pivotal role of tech-driven innovation in advancing low-carbon and climate-resilient development. Other major supporters include the US International Development Finance Corporation (DFC), the UK Government’s UK-India Development Cooperation Fund (UKIDCF), the Self Reliant India (SRI) Fund, Small Industries Development Bank of India (SIDBI), Azim Premji Trust, and several large corporations.

Anjali Bansal, Partner, Avaana Capital, commented “India is at a pivotal moment in its climate action journey. The support we’ve received from leading global and domestic institutional investors underscores the importance of innovation in driving climate action and delivering long-term impact. The Avaana Climate & Sustainability Fund will help build the next generation of climate-first companies to transform key sectors and make meaningful progress toward a sustainable future.”

Since its inception in 2018, Avaana has backed over 20 startups, including FarMart, Ninety One Cycles, Kazam, Eeki Foods, Aerem, Sentra, Eggoz, TurnO, Terra.do, and Dharaksha.

India, as one of the world’s most climate-vulnerable nations, holds a critical position in global climate solutions. With a population of over 1.4 billion and the world’s sixth-largest economy, estimates suggest the country will require over $10 trillion in investment by 2070 to meet net-zero goals and address climate risks. Avaana’s investments aim to meet this urgent demand by driving innovation that cuts emissions, enhances resource efficiency, and accelerates India’s transition to a low-carbon future.

Kavita Sinha, Director, Division of Private Sector Facility, Green Climate Fund, said, “GCF is proud to make its first investment in a climate venture fund in India through Avaana’s Climate and Sustainability Fund. Avaana’s focus on transformative technologies in critical sectors like food and agriculture, energy, mobility, and similar climate ventures will provide climate aligned solutions to people and support India’s climate ambitions. This aligns with GCF’s vision of catalysing meaningful climate solutions as this partnership will accelerate India’s net-zero journey and create scalable models for other emerging markets facing similar challenges.”

Adding to this, Sally Taylor, Minister Counsellor, British High Commission, said “The UK Government’s development investments in India support innovative Indian businesses to develop products and services that will accelerate sustainable, inclusive growth. We are pleased to be deploying our funds through Avaana to enable them to back those pioneering enterprises harnessing technology to develop new climate solutions to address the climate crisis.”

R.K. Singh, Chief General Manager, SIDBI said “At SIDBI, our focus has been on creating pathways for climate responsive enterprise eco system to thrive in India. The Avaana Climate and Sustainability Fund aligns perfectly with our mission by supporting innovative, climate-tech startups that are key to India’s transition to a sustainable, low-carbon economy.”