Goldman Sachs AM raises $1.6 billion for its first Horizon Environment and Climate Solutions fund

Goldman Sachs Asset Management (“Goldman Sachs”)  today announced the final close of Horizon Environment & Climate Solutions I (“Horizon  Climate” or “the fund”). The fund, which closed at over $1.6 billion, is Goldman Sachs’ inaugural direct private markets strategy dedicated to investing in climate and environmental solutions.  This is the first in a series of “Horizon Funds” through which Goldman Sachs will partner with clients to invest in key sustainability trends. 

The fund is a global, growth-oriented private equity strategy that seeks investments in companies focused on innovative environmental and climate transition solutions. The fund focuses on five themes that underpin Goldman Sachs’ approach to climate transition – Clean  Energy, Sustainable Transportation, Waste and Materials, Sustainable Food and Agriculture,  and Ecosystem Services. These themes represent sectors where Goldman Sachs has observed secular demand and growth opportunities for cost-effective solutions needed by organizations seeking to achieve sustainability goals. 

The fund is managed by the Sustainable Investing Group within Goldman Sachs which was established in 2020. The investment professionals in the Sustainable Investing Group bring decades of experience investing in sustainability and seek to harness the expansive resources of the Goldman Sachs platform to source differentiated investments and accelerate value creation for portfolio companies.  

Goldman Sachs is one of the world’s largest managers of private markets impact capital and has an extensive history of transformative private markets investments in the space, in particular through its Private Equity and Infrastructure strategies.  

“Horizon Environment & Climate Solutions I represents the transformative power of private capital to help scale cutting-edge technologies that will make a meaningful impact in the race to net zero. We are grateful for the support of our clients in partnering with us on this inaugural  fund and are excited for the journey ahead as the focus on sustainability increases in  importance across our investing businesses".

Julian Salisbury, Chief Investment Officer for Asset & Wealth Management at Goldman Sachs.

Horizon Climate is augmented by a proprietary Corporate Network, which convenes sustainability leaders from global corporations to discuss sustainability needs and solutions, providing the fund with unique thematic insights and a better understanding of the objectives associated with corporates’ sustainability journeys. The fund also leverages Goldman Sachs’proprietary operating platform, the GS Value Accelerator, to work with portfolio companies to build enduring businesses and create incremental value.  

The fund intends to work closely with management teams to enhance the impact and will report on the impact in each portfolio company and for the fund as a whole. It is positioned as Article 9 under the Sustainable Finance Disclosure Regulation. 

“Goldman Sachs has been investing in transformative environmental and climate solutions since 2005. Since then, we have witnessed major changes in the technologies that enable more efficient and sustainable business practices, and the appetite from users to adopt them. Today, as the imperative to transition to a more sustainable economic growth  model gathers pace, we are excited to continue backing leading businesses in this space as  they develop and scale the environmental and climate solutions of tomorrow".

Ken Pontarelli, head of Sustainable Investing for Private Markets within Goldman Sachs Asset  Management.

Horizon Climate has already committed nearly $1 billion across 12 portfolio companies at the forefront of climate and environmental innovation. These investments span markets in North  America and Europe and include, among others, leading manufacturers in lithium-ion batteries,  sustainable packaging materials, and high-quality recycled cotton fibers, as well as businesses aiming to increase efficient water usage in agriculture and increase energy efficiency in commercial and industrial buildings.  

The fund exceeded the initial fundraising target to close on $1.6 billion, including commitments from some of the world’s largest and most sophisticated investors.  

Goldman Sachs supports sustainable economic growth and financial opportunity, which is foundational to the firm’s work on net zero where growth capital is needed to support the transition to a lower carbon economy. The firm has set a ten-year goal of $750 billion in sustainable finance activity by 2030, of which Goldman Sachs has achieved approximately $300  billion.