Climate Insider Brief:
- Mackinnon, Bennett & Company (MKB) has closed $145 million for its third cleantech fund, MKB Fund III, with contributions from Canada Growth Fund (CGF), Caisse de dépôt et placement du Québec (CDPQ), Investissement Québec (IQ), and Business Development Bank of Canada (BDC).
- MKB Fund III will invest in North American growth-stage businesses specializing in emission-reduction technologies, targeting sectors such as clean energy, mobility, the built environment, and industrials.
- This new fund follows MKB Fund II, which closed at $175 million in 2021, and highlights a continued commitment from key investors to support the development and expansion of Canadian cleantech ventures.
Montréal-based growth equity firm Mackinnon, Bennett & Company (MKB) has successfully closed $145 million in funding for its third cleantech-focused venture fund, MKB Fund III. This substantial financial backing comes from a consortium of prominent government investment agencies and public institutions.
The Canada Growth Fund (CGF), which was established with a $15-billion mandate to boost Canadian clean technology businesses, is investing $50 million into MKB Fund III. Additionally, both Caisse de dépôt et placement du Québec (CDPQ) and Investissement Québec (IQ) are contributing $35 million each. The Business Development Bank of Canada (BDC), a Crown corporation that has previously led MKB’s funds, will provide the remaining $25 million.
MKB Fund III will concentrate on North American growth-stage companies that are developing and commercializing emission-reduction technologies. The fund’s strategic areas of interest include clean energy, mobility, the built environment, and industrials. This targeted approach aims to address the critical capital needs of emerging cleantech ventures and facilitate their expansion.
The official statement from CGF marks the first formal announcement of MKB Fund III, following an earlier private report by Private Capital Journal, which noted an initial $158 million closing for the fund in March 2024. The BDC, CDPQ, and IQ have been key supporters of MKB’s previous funds, with MKB Fund II closing at $175 million in 2021, exceeding its original target of $150 million.
BDC Senior Vice-President Paula Cruickshank highlighted the fund’s importance, stating, “The Fund’s orientation on late and growth-stage opportunities responds to a critical need in the Canadian market, supporting the often-complex capital requirements of homegrown cleantech ventures and facilitating their expansion. This is exactly the kind of market gap BDC is designed to address.”
The CGF’s involvement is part of its broader mandate to scale Canadian clean technology enterprises. In its 2023 budget, the federal government announced that the Public Sector Pension Plan Investment Board (PSP Investments) is managing the CGF. Notably, last week, the CGF committed $137 million CAD to the Burnaby-based cleantech company Svante through a convertible note.
MKB’s existing portfolio features notable investments in carbon removal startup CarbiCrete, electric scooter company Bird, and traffic management company Miovision. In April 2023, Telus acquired MKB’s stake in Miovision for $52 million.
As MKB Fund III sets its sights on accelerating the growth of promising cleantech ventures, it reflects a growing recognition of the vital role played by strategic investment in fostering innovative solutions to global environmental challenges.
SOURCE: Betakit
Featured Image: Credit: Stacey Newman via Getty Images
