As COP30 approaches, investors are zeroing in on nature-based solutions as critical levers for meeting climate and biodiversity goals. Nature-based solutions, once dominated by donors and NGOs, are beginning to attract new types of capital.
ImpactAlpha has tracked more than 30 limited partners that have invested in the past year in funds supporting regenerative agriculture, reforestation, carbon sequestration, ocean restoration and other nature-based strategies.
Corporate and institutional interest
The private sector has a pivotal role to play in financing the protection and restoration of natural resources and biodiversity. A 2024 report by the UN Environmental Programme Finance Initiative found that private finance for nature has increased from just $9.4 billion in 2020 to more than $100 billion last year. Corporations and institutional investors have been key to that growth.
Microsoft’s Climate Innovation Fund and CalSTRS are anchor LPs in Just Climate’s $175 million Natural Climate Solutions strategy. The fund is investing in reforestation and ecosystem restoration projects with commercial and climate upside.
Invest-NL committed to Regeneration.VC’s second fund, which targets early-stage climate innovations in consumer sectors. The portfolio includes companies working on compostable materials, carbon-negative packaging, and regenerative textiles.
Milkywire’s Climate Transformation Fund, which recently backed Nigerian biocard producer Releaf Earth, has received corporate funding from Klarna, Salesforce and Spotify. The fund supports carbon removal projects often overlooked by traditional investors.
Climate Asset Management’s twin vehicles – the Nature-Based Carbon Fund and the Natural Capital Fund – launched with capital from HSBC, Gothaer Asset Management and corporate backers GSK, Tokyo Gas and Carrier. Combined, the two funds aim to deploy over $1 billion into conservation, restoration and sustainable land use globally.
Catalytic capital
It’s mostly development finance institutions and philanthropic investors who are providing early, often concessional or catalytic, support for nature-based investment funds in emerging markets. The Global South houses the world’s most biodiverse and climate-vulnerable areas, but fund managers working in these markets still have difficulty attracting mainstream commercial capital.
The Inter-American Development Bank’s IDB Invest has backed EcoEnterprises Fund’s fourth fund, which builds on the firm’s thesis of financing Latin American businesses in sustainable agriculture, agroforestry, ecotourism, aquaculture and climate resilience. EcoEnterprises is also backed by Wire Group, a Netherlands-based impact fund of funds backed by family offices.
The US International Development Finance Corp., IDB Lab and the Green Climate Fund are LPs in Regenera Ventures’ first fund, which invests in regenerative agriculture and also supports Indigenous and smallholder farmer land stewardship in Mexico and Central America. The
Also backed by IDB Lab and the Green Climate Fund is KPTL’s Amazonia Regenerate Accelerator and Investment Fund, which invests in bioeconomy startups and projects in the Amazon Basin.
In the Andean Amazon, DF Impact Capital and Sorenson Impact Foundation invested NESsT’s Lirio Fund and IMPAQTO Capital to support Indigenous- and women-led rural enterprises. Fundación Aliados, which supports biodiversity-based businesses led by Indigenous and local communities, has raised capital from the EU, the McKnight Foundation, the World Wildlife Federation, IDB Lab and other institutional and philanthropic partners.
In Africa, Acumen’s Resilient Agriculture Fund was seeded by a $25 million first-loss commitment from the Green Climate Fund, helping unlock an additional $33 million from Proparco, FMO, Open Society Foundations, the Children’s Investment Fund Foundation and Global Social Impact.
One Acre Fund, which serves smallholder farmers in Africa, has received funding from the Audacious Project, the Gates Foundation, Bezos Earth Fund, Cartier Philanthropy, CF Industries and the now defunct USAID.
Finally, the Global Fund for Coral Reefs, managed by Pegasus Capital Advisors, is one of the few commercial-scale funds focused on ocean ecosystems. Anchored by the Green Climate Fund, the fund supports blue economy projects aligned with Sustainable Development Goal 14: life below water.
