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Introducing the MCJ Collective Opportunity Fund
It’s been about 14 months since we announced our investment fund, MCJ Collective. Since then, we have deployed over $9m, and backed 45 of some of the very best climate tech companies out there across stages, sectors, and geographies.
Here are a list of the ones that have been publicly announced:
It’s been a real honor to have so many of these founders and investors believe in us. Not only have they made room in rounds that are often oversubscribed for our little checks, but many of them have gone on to become LPs in our fund as well. From the anecdotal feedback we’ve gotten from the portfolio (and the referrals of other founders raising money!), it is clear that in many cases we’ve also been able to punch above our weight class for help, given our perch with MCJ and access to such a diverse and strategic mix of information and people. Increasingly, it isn’t just us that is able to help, it's the broader MCJ ecosystem: the LPs, the guests from the show, the member community, and increasingly the portfolio companies themselves. With 45 climate tech startups and growing in the MCJ portfolio, there is almost always a founder in the portfolio ready to help another portfolio company with what they need, whether it is selling into common customers, hiring, questions about bookkeeping, issues with the board, industry questions, or anything else that might come up.
We’ve already had quite a few significant up-rounds in the portfolio, even though it’s just over a year old. With our rolling fund structure, each quarter is a new fund which means we technically have no follow-on reserves. When a portfolio company raises a new round that we’d like to join, we’ve been able to write subsequent ~$250k checks from the Core Fund portfolio out of the current quarter’s fund. Increasingly, we are coming across opportunities where we have both the access and the desire to go much deeper than $250k, based on what we have seen working closely with these companies from the inside. But the Core fund is intentionally diversified, and as such, we have no mandate to write larger checks and tip the balance of any one quarter’s fund heavily towards a single company. Our only option for going heavy into a company today is to do an SPV. But passing a hat around for an SPV is time consuming for our tiny team, and the market is often moving too quickly. We had a sense this would be an issue before the Core Fund even launched :)
This has led us to announce the MCJ Collective Opportunity Fund, for which we are currently accepting commitments. The MCJ Collective Opportunity Fund will activate on January 1, 2022, and will seek concentrated exposure to climate tech companies that are on a proven trajectory. Initially the fund will target 1-3 investments per quarter at $1mm+ per investment. This strategy will likely evolve as we learn more about our ability to gain the allocation we seek in the companies and rounds we are targeting and more about the volume of investments in which we seek to participate.
We view the MCJ Opportunity Fund as complementary to the existing MCJ Collective Core Fund, the latter of which seeks to provide broadly diversified and stage-agnostic access to the climate tech startup ecosystem through a strategy of 10-12 investments per quarter in the $100k-$250k range per investment.
We are excited about the MCJ Opportunity Fund and with how it aligns with our overall investment strategy at MCJ Collective. Broadly speaking, we seek to gain access to the most promising climate solutions, help companies accelerate their progress through the MCJ platform, earn our keep, and participate throughout the companies’ lives as they mature. And given our value prop is so people-centric, we’ve found that the MCJ capital platform can scale from pre-seed to series D and beyond. We’ve been humbled by the many later stage companies that have made room on their cap tables for little MCJ, including Lilac, Arcadia, AMP Robotics, Crusoe Energy, Leap, and LevelTen Energy, to name a few that have been announced. We will be announcing several more in the coming weeks and months.
You can learn more and, if you are an accredited investor, apply to become an LP of the MCJ Opportunity Fund here. We’ll begin investing out of this vehicle on January 1.
Jason, Cody, Thai, and David