February 1, 2023

Inside Poland’s plan to create Europe's new climate tech giants

PFR Ventures says that its green fund is the first of its kind in Europe

Zosia Wanat

6 min read

Małgorzata Walczak, investment director at PFR Ventures

Poland wants in on the climate tech boom — and it has a cunning plan to help it invest in the green giants of the future.

Poland’s state-owned fund of funds PFR Ventures has invested €55m across four green VC funds which have pledged to actively search for Polish climate tech startups to back.

PFR Ventures claims that its initiative, dubbed PFR GreenHub, a separate fund that aims to back VCs investing in startups tackling climate challenges and energy transformation, is the first of its kind in Europe. 


So far, it’s backed Lithuania’s Contrarian Ventures, French VC Eurazeo’s Smart City fund, US VC General Atlantic’s BeyondNetZero fund and Poland’s Montis Capital — and it plans to invest in at least two more funds in the upcoming months.

“I would like to see how climate tech companies start to emerge in Poland. Because now, there are very few of them… When it comes to climate tech in Europe, we’re on a very low level,” says Małgorzata Walczak, investment director at PFR Ventures, who is responsible for the scheme. 

“Our dream is that in five, six years, we could have the international headquarters of great companies with climate tech strategies, and that we will attract those international investors to our VCs.”

‘Big change’

Investment in climate tech has been booming across Europe in recent years: in 2022, it reached a record high of $15.9bn, according to Dealroom. And despite the overall slowdown in tech, climate tech investment has held firm on the continent. 

VCs have been educated: they know what climate tech is and why it’s worth being in, and have one or a few startups from this sector in their portfolio

But in Poland, the largest market in central and eastern Europe, investment in climate tech is still quite small. It reached just $39.8m in 2022 — despite the country’s high carbon emissions and skyrocketing air pollution levels. Some Polish startups — like air pollution tracker Airly — have caught the attention of international investors, but most are still very early-stage.

VC interest is shifting, however, thanks to upcoming EU regulations, skyrocketing energy prices and the fact that European climate tech startups are now starting to attract some big investment rounds. 

Agnieszka Maciejowska, founder of carbon footprint tracker Plan Be Eco, says that when she was raising her pre-seed round two years ago, investors would frown upon her plan, asking if it made business sense. “When I talked about impact business the majority of investors thought that I want to build a well in Africa,” she says.

Now, she’s raising a seed round and says “everything has changed”. 

“VCs have been educated: they know what climate tech is and why it’s worth being in, and have one or a few startups from this sector in their portfolio.” 

When we started to talk about it in 2016 no one knew what impact was. Now, the market has evolved

There are more Polish funds that specialise in climate tech — such as impact VC Simpact and  Montis Capital — and generalist VCs are now also more open to investing in climate.

That’s in part because the attitude of their investors — the limited partners, or LPs — has also shifted. 


“When we started to talk about it in 2016 no one knew what impact was. Now, the market has evolved, and people can judge our performance and our portfolio companies,” says Krzysztof Grochowski, partner at Simpact, which raised its second fund of 100m złoty (€21.2m) in 2022. 

He says that raising the latest fund was, nevertheless, “hard work". 

“In the first conversations, ‘impact’ drove the investors away, rather than attracted them. After the second, third, fourth contact when we showed what it was really about, it became like a magnet.” 

Help from abroad

“The focus of regional VCs on climate tech is noticeably bigger than a few years ago,” says Łukasz Skarka, investment director at EIT InnoEnergy, a vehicle that invests EU money in startups. “But there are a couple of big asterisks that we need to add.” 

Polish VCs lack the experience of some of their European peers, he says, when it comes to the climate tech sector in particular, and also later-stage companies.

As a result, PFR Ventures has so far invested mostly in foreign funds with more extensive experience in climate tech — under the condition that they make their “best efforts” to invest in Poland. The VCs it invests in will have to hire a partner in Poland, for example, and their senior management will have to visit the country every quarter.

“The success is the permanent presence of these VCs here, so that our VCs could learn from them how to do these investments: they’ll be the window to the world,” Walczak says. 

Tomas Kemtys, a partner at Contrarian Ventures, one of the VCs PFR Ventures has invested in, says that he is sure Poland can create climate tech ventures, just like other western European ecosystems. 

“The key factors which appeal to us generally are a strong academic base which breeds great labour markets for climate tech companies, growing investor appetite for climate tech, with generalist funds building out expertise in climate tech, as well as a growing and maturing tech ecosystem more widely,” he says.

Struggle continues

Despite this growing interest, Polish founders — like many of their peers around Europe— struggle to find VCs who invest in hardware. 

Szymon Barabasz, founder of Swapp!, which produces refill stations for cosmetics and cleaning products, has been raising a 5m złoty (€1m) seed round for more than a year now, with no success. 

“We made an incorrect assumption that if we have great clients, big partnerships, great product, revenue and the market is growing, it would be no problem for us to raise a second round. And it turned out that we were wrong.” 

If we want to solve the problem of single use plastic, we won’t do it with software

He says investors aren’t ready to back hardware products. “If we want to solve the problem of single use plastic, we won’t do it with software — and this means costs, this means [problems with] scalability, and Polish investors are very afraid of it.” 

Skarka from EIT InnoEnergy says that he sees a big difference between investors’ appetite for hardware and software projects — and that that is an opportunity for PFR.

“This is a place for PFR Ventures — under the condition that they’ll choose good operators and will give them a mandate to engage with hardware with all responsibility of what’s linked to that,” he says.

The ecosystem is also lacking advanced deeptech solutions. Maciej Majewski, CEO at Accelpoint, a CEE accelerator that recently launched Poland’s first ever climate tech acceleration programme, says that only 25% of the startups that take part in the scheme have come out of universities. He thinks that percentage should be a lot higher.

“[In Poland], we have technical and scientific skills but [aren’t so good at] commercialisation,” he says. “In climate tech we should look through deeptech solutions. We need to take advantage of much more advanced knowledge, which exists at the universities, but they can’t really commercialise it.”

If PFR GreenHub isn’t an answer to all these problems, it’ll at least put “fire” into the sector, says Walczak.  

“If we put money on this, if we share specialised knowledge from VC funds that invest in that sector, if it’s stable and sustainable, then it’ll pick up,” she says. “We’ll set a trend: we will stop thinking only about returns while doing these investments because, really, we won’t be able to breathe with money in the future.”

Zosia Wanat

Zosia Wanat is a senior reporter at Sifted. She covers the CEE region and policy. Follow her on X and LinkedIn