A $45 million regenerative economy fund is launched with Leonardo DiCaprio

A fledgling venture capital firm has announced the final close of its first $45 million funds, backed by an all-star roster of strategic advisers also investors, adding actor Leonardo DiCaprio also circular economy pioneer William McDonough. Regeneration.VC is a seed and series investment firm that focuses on circular and regenerative approaches to consumer industries.

Why is this segment being highlighted? Consumer supply chains, according to Smith, account for 45 percent of global emissions. At the same time, he claims that climate-friendly apparel and consumer packaged goods represent a $4.5 trillion business opportunity. The fund prioritizes design (packaging and materials), use (products and brands), and reuse (reverse logistics and marketplaces).

"Consumers have power," says Michael Smith, co-founder, and general partner. "Through our purchasing decisions, we can significantly improve the planet."

McDonough's work on the circular economy, reusing or extending the life of materials in products, was a significant inspiration for the fund. (McDonough is now serving as a strategic advisor.) For the fund, this means investing in companies that manufacture or use such materials and upcycling, repairing, and reselling items.

A "circular technosphere," in which technology permits materials to move also circulate throughout the supply chain, also a "regenerative biosphere," or natural systems for absorbing carbon, such as trees, a carbon cycle flow, in which things are returned to the earth, regenerate the soil.

According to Smith and Dan Fishman, co-founder and general partner, various changes in regulations and consumer sentiment are leading to significant changes in the behavior of large brands. Numerous important corporations, ranging from Nike to Unilever, have already committed to circular strategies by 2030.

Furthermore, the EU recently issued regulations regarding circular economy plans, and multiple states in the United States are working on circular-economy-related rules. To keep up, "big corporations know they have to do something," Smith says. "And this is an important way to participate in that process."