Synopsis
Circulate Capital has successfully raised $220 million in the first close of its second fund, surpassing its initial target. This new fund will invest in circular supply chains and recycling ventures across South and Southeast Asia, focusing on plastics, packaging, electronics, and apparel. The firm aims to scale its operations and deliver both financial and impact returns.The second fund has exceeded the size of Fund I, which was $188 million.
A circular economy refers to a system that minimises waste by reusing, recycling, and regenerating materials.
Through Fund II, the firm aims to back circular supply chains and recycling ventures across South and Southeast Asia, with a focus on plastics and packaging, along with electronics and apparel.
“Our track record of successful exits demonstrates that the circular economy is no longer just a subset of ESG or sustainability. It is a sophisticated asset class that can deliver liquidity to private equity investors,” said Rob Kaplan, founder and chief executive of Circulate Capital.
The firm has fully exited digital waste management platform Recykal. It has also made partial exits from Lucro, a recycler specialised in plastic packaging, and Srichakra Polyplast, a food-grade plastic recycler.
“With Fund II, we are ready to scale and capture the massive growth potential inherent in these high-velocity economies, to build businesses that deliver financial and impact returns for our investors,” Kaplan added.
Circulate Capital will invest the new fund in key markets, including India, Indonesia, Thailand, Vietnam, Philippines, and Malaysia. The firm's investment focus includes expanding mature plastic recycling streams, building nascent markets for other plastic materials such as polyolefins, advancing innovation in paper-based packaging alternatives, and recovering critical and rare earth materials from recyclable electronics and batteries.
The capital for its second fund was raised from corporates such as The Coca-Cola Company, Danone, Dow, and Procter & Gamble along with institutions such as British International Investment, the French development finance institution (DFI) Proparco, and the International Finance Corporation (IFC).
Circulate Capital also brought in new institutional backers, including the Emerging Markets Climate Action Fund, co-managed by Allianz Global Investors and the European Investment Bank, as well as a Dutch pension fund via Achmea Investment Management’s Impact Platform.
The fund has completed more than 30 deals across South and Southeast Asia and the Latam region and has over $480 million in assets under management.
