Gigascale Capital raises $250 million to back climate tech amid sector slump
Gigascale’s second fund, which includes institutional investors, focuses on early-stage startups developing solutions for critical energy and material shortages.
Gigascale Capital, the venture firm established by former Meta Chief Technology Officer Mike Schroepfer, has successfully raised a $250 million fund for its second iteration. This vehicle is specifically earmarked for early-stage investments in climate technology, with a strategic focus on energy generation, grid infrastructure, and critical minerals. The fund distinguishes itself by bucking the prevailing market trend of waning investor interest in the climate tech sector.
Schroepfer attributes the fund’s thesis to surging electricity demand driven by artificial intelligence and broader electrification, noting that existing solutions such as natural gas turbines face significant waitlists extending into the early 2030s. The firm’s investment philosophy prioritises commercial viability, seeking solutions that are cheaper, faster, and more reliable. Gigascale’s portfolio already includes notable entities such as Commonwealth Fusion Systems, Heron Power, Mill, and Form Energy.
The announcement was made on Monday, with the original report published on 1 June 2026. Gigascale emerged from Schroepfer’s study of climate technology conducted during the COVID-19 pandemic, leading to the founding of the firm. The new fund is the first to include institutional investors and maintains an early-stage focus, building on previous investments made over the last three years.
Climate tech has always been a wide-ranging sector, but recent years have seen a shift towards energy and infrastructure, largely influenced by AI’s power requirements. Solar power and battery storage have previously dominated clean power conversations, but Schroepfer identifies opportunities beyond these established technologies. The concept of "bring-your-own power" is emerging as a competitive advantage for energy-intensive industries seeking to bypass grid congestion.
Schroepfer highlighted that natural gas turbines currently have waitlists extending into the early 2030s, creating an opening for startups offering alternative power solutions. In energy-intensive industries, providing power independently is viewed as a long-term competitive advantage. Startups that can supply power cheaper or more flexibly can win on those merits alone, according to Schroepfer.
Gigascale also expects its energy investments to extend beyond generation, citing grid infrastructure, critical minerals, and physical AI as other areas where the company will look for opportunities. Schroepfer stated that the companies backed by the firm win because they are cheaper, faster, and more reliable, noting that climate impact is the result of better-performing systems.
The specific breakdown of the $250 million fund across different sub-sectors is not detailed, nor has the exact composition of the institutional investors participating in this second fund been disclosed. The timeline for when these investments will begin to yield measurable climate impact is also not specified.
