Climate-Focused VC Firm Expands Investment Strategy Across Energy Transition, Advanced Manufacturing and Semiconductors
Transition VC, a Bengaluru based venture capital firm focused on energy transition technologies, has launched its ₹1,500 crore Fund II (approximately $150 million) to invest in early-stage energy and deeptech startups. The new fund is more than double the size of its maiden fund, reflecting growing investor confidence in climate technologies and industrial innovation.
The announcement comes months after the firm completed the final close of Fund I at ₹700 crore, significantly exceeding its original target of ₹400 crore. With the new fund, Transition VC aims to accelerate investments in startups developing next-generation energy infrastructure, advanced manufacturing technologies, and industrial deeptech solutions.
What Is Transition VC’s New Fund?
Transition VC’s Fund II has been launched with a target corpus of ₹1,500 crore and will focus on supporting 20 to 23 startups working across the energy demand and supply value chain.
The firm plans to make investments ranging from $2 million to $5 million per startup, primarily targeting hardware-driven and deeptech companies with demonstrated technical feasibility and early commercial traction.
The fund will continue backing founders solving critical challenges in clean energy, industrial decarbonisation, and electrification while expanding into emerging engineering intensive sectors.
How Has Transition VC Performed So Far?
Transition VC has reported strong early performance from its first fund.
According to the firm, Fund I has generated an Internal Rate of Return (IRR) of 57% while delivering a more than three-times Multiple on Invested Capital (MOIC) within just three years.
The firm’s debut fund closed at ₹700 crore (around $77 million) in December last year, attracting capital from institutional investors, corporate partners, family offices, strategic investors, and industry leaders.
So far, Transition VC has invested in 17 startups, with plans to build a portfolio of up to 25 companies under Fund I.
Its existing portfolio includes startups such as CIMware, Comminent, Matel, EMO, Hydgen, Dynolt, and Promethean, spanning multiple areas of energy innovation and industrial technology.
Which Sectors Will Fund II Focus On?
While energy transition remains the firm’s primary investment theme, Fund II significantly broadens its investment mandate.
In addition to supporting startups working on:
- Electrification
- Energy storage
- Industrial decarbonisation
- Alternate fuels
- Next-generation manufacturing
the fund will also actively explore opportunities in several emerging technology sectors, including:
- Advanced manufacturing
- Application engineering
- Semiconductors
- Nuclear energy technologies
- Geothermal energy
- Next-generation energy infrastructure
The expanded strategy reflects increasing demand for engineering-led innovation capable of supporting India’s long-term energy transition and industrial competitiveness.
Why Is Investor Interest Growing in Climate DeepTech?
Global investors are increasingly directing capital toward climate technologies as governments and industries accelerate decarbonisation efforts.
Beyond renewable energy generation, attention is shifting towards enabling technologies such as advanced materials, energy storage, semiconductor innovation, industrial automation, and next-generation manufacturing.
These sectors require significant engineering expertise and longer development cycles but also offer opportunities to build globally competitive technology companies.
Over the past year, several venture capital firms have launched dedicated climate-focused investment vehicles aimed at supporting startups developing solutions for clean energy, sustainable manufacturing, and carbon reduction.
Transition VC’s second fund reflects this broader trend of increased institutional interest in climate and industrial deeptech investments.
About Transition VC
Transition VC was co-founded by Raiyaan Shingati and Mohammed Shoeb Ali with the objective of supporting engineering-led startups building technologies for the future of energy and manufacturing.
The firm primarily invests in early-stage companies developing innovations across electrification, battery technologies, industrial decarbonisation, alternative fuels, and advanced manufacturing systems.
By combining technical expertise with long-term capital, the firm seeks to help founders commercialise breakthrough technologies capable of addressing large industrial and sustainability challenges.
Outlook
With a target corpus of ₹1,500 crore, Transition VC’s second fund positions the firm among India’s larger sector-focused venture capital funds dedicated to climate and industrial innovation.
As demand for clean energy infrastructure, advanced manufacturing, and deep engineering solutions continues to rise, startups operating in these sectors are expected to attract increasing investor attention.
For founders building hardware-intensive and science-driven technologies, the launch of Fund II expands access to specialised growth capital designed to support long development cycles and large-scale commercialisation.
The fund also signals growing confidence in India’s ability to build globally competitive deeptech companies that can contribute to the country’s energy transition and manufacturing ambitions.
