At Sweden Sustaintech Venture Days (1–2 December 2025), we had the pleasure of being joined by Craig Douglas, Founding Partner at World Fund, for a fireside chat that cut straight to the heart of Europe’s climate-tech challenge: scaling innovation into impact. The discussion also coincided with the Nordic launch of the Green Finance Institute’s “Nordic Cleantech Scale Finance Playbook” and offered a first look at World Fund’s upcoming report, “The Series B Funding Gap in European Climate Tech.”
Europe is world-class at early-stage innovation. It invests more than the U.S. at seed and Series A levels and produces a greater number of climate-tech startups overall. Yet as these companies reach larger rounds, moving towards series B and beyond, the funding gap becomes painfully clear. Craig explained that this gap emerges precisely when companies are ready to scale. The problem isn’t a shortage of money: Europe’s pension funds are larger than those in the U.S. What’s lacking is the willingness and structure to allocate that capital to venture. Institutional investors contribute only about 30% of European VC capital, compared to 70% in the U.S., and pension funds allocate just 0.02% to VC versus 2% in the U.S.: a 100-fold difference.
“We’re not short of capital,” Craig said. “We’re short of putting it in the right place.”
Hear more about this in our interview with Craig here.
The Nordics exemplify this paradox. The region produces an impressive number of startups, yet graduation rates from seed to Series A and B lag behind both U.S. and European averages. Companies that do make it to later-stage rounds often succeed, usually with leadership from international investors. But the number of funds capable of supporting €20–100 million rounds has not kept pace with the doubling of early-stage startups in recent years. “If CorPower Ocean had raised €100 million at Series A, they’d likely be commercial today,” Craig noted.
Beyond capital, there are other hurdles to scaling. The Nordic Cleantech Scale Finance Playbook highlights gaps in capability, communication, and coordination. Many startups struggle to deliver first-of-a-kind industrial projects on time, and entrepreneurs often speak the wrong “language” when approaching banks versus venture capitalists. Meanwhile, fragmented policy signals slow investment and deployment, leaving investors uncertain about the long-term landscape. Craig emphasized the need for consistent, long-term policies to guide both capital and innovation.
For Europe to unlock its climate-tech potential, Craig emphasised a dual need:
More ambitious, larger venture funds — and regulatory or structural incentives that encourage institutional investors to actively participate in venture markets.
When asked for the single most impactful intervention, Craig was unequivocal: reform the rules governing private capital for institutional investors. Even a modest shift could unlock enormous funding for climate-tech growth. As he concluded, Europe doesn’t have a startup problem, it has a commercialization problem. Solving it could be one of the most compelling financial opportunities of the decade.
