🌍Newsletter - December 2024
Welcome to the 12th edition of the AFI Ventures’ newsletter.
As a reminder, AFI Ventures (fund managed by Ventech) is an impact VC fund that invests in pre-seed/seed startups with a strong environmental and social ambition, producing a systemic change. We invest once a month in France & Europe tickets ranging from €250K to €500K.
Each month in this newsletter, you'll find a summary of 2 articles on the impact ecosystem that have caught our attention, fundraisings realised by impact startups in France, and news from our portfolio. 💚
👀 What Caught our Eye
Reinventing Leather Through Science - Faircraft
by Camille Wong
Founded in 2021, Paris-based startup Faircraft is pioneering lab-grown leather, positioning itself at the intersection of luxury and sustainability. Recently, the company raised €15M, to scale its groundbreaking technology.
The Science of Lab-Grown Leather
Faircraft produces leather "in vitro" using a novel process:
Cell Cultivation: Starting with a skin biopsy, cells are cultured in a bioreactor.
Growth Process: Over four weeks, the cells form sheets of leather-like material, which are then tanned in a simplified process.
This approach boasts an environmental footprint ten times smaller than traditional leather production, offering a scalable solution for eco-conscious luxury.
Market Context and Competitors
Faircraft operates in a competitive landscape alongside startups like Qorium (Netherlands) and Vitrolabs (USA). Unlike plant-based or synthetic alternatives, Faircraft replicates the structure and texture of animal leather, appealing to high-end brands.
Scaling Challenges and Partnerships
Currently producing a few square meters per month, Faircraft aims to open its first factory within three years. However, the journey to industrial-scale production is fraught with challenges, including cost optimization and automation.
Despite these hurdles, the startup collaborates with several luxury brands, recently crafting a prototype handbag indistinguishable from traditional leather.
A Sustainable Luxury Future
With two patents and a focus on energy efficiency, Faircraft is at the forefront of sustainable innovation in the luxury industry. While the road ahead requires navigating industrialization and market demand, its approach could be reshaping the future of leather.
Faircraft’s first handbag.
The Strategic Role of Energy Flexibility in Grid Stability
Real-Time Adjustments
“Consume better, consume less, while supporting the energy transition and ensuring system stability,” summarizes Sébastien Pialloux, Vice President Flexibility Retail at Engie. Innovations like connected thermostats are proving instrumental, allowing radiators to adjust temperature without noticeable discomfort to users. Engie offers these smart thermostats, mandatory by 2027, as a way to reduce peak demand and lower consumer energy bills.
Elax Energie, led by founder Thomas Tirtiaux, contributes by piloting 24,000 connected water heaters, storing energy equivalent to 200 MWh. These act as a “giant thermal battery,” improving grid flexibility while optimizing individual consumption patterns.
Shaping Consumer Behavior
Both Engie and Elax Energie highlight the importance of consumer engagement. For water heaters, Elax Energie emphasizes savings and maintaining comfort to gain user consent. Similarly, Engie integrates consumer participation through programs like Ecodéfis+, rewarding customers for reducing consumption during peak hours.
Angela Sutan, a behavioral economics professor at ESSEC, notes that behavior change is more effective when mental effort is minimized. “Default options” reduce decision fatigue, encouraging adoption. Additionally, consumers are more motivated by potential losses than by equivalent gains, a factor critical in designing energy programs.
Leveraging Technological Innovation
Technological advancements complement behavior-driven strategies. Engie’s new “Ma Recharge Intelligente” program introduces smart charging stations for electric vehicles, offering automatic charging during off-peak hours and reducing costs by 28%. Similarly, Elax Energie’s connected water heaters save users approximately €95 annually, with plans to expand to private households.
Angela Sutan stresses the importance of seamless integration: key solutions must be simple and turnkey to ensure widespread adoption.
A Broader Shift in Perspective
Energy flexibility is not just about savings or technology—it signifies a societal shift. Viewing energy as a service rather than a product emphasizes its value and encourages conservation. As both consumers and technology evolve, energy flexibility will play a pivotal role in achieving a sustainable, stable energy future.
🍃 AFI Ventures - Main Highlights
AFI Ventures’ Public Investments in November
Faircraft 🇫🇷 - (€15M / Kindred Ventures, Heirloom, Blue Wire Capital, AFI Ventures, CapHorn) In-vitro leather as a sustainable alternative to traditional animal leather.
Investment rationale:
Market opportunity €400B global leather market, primed for disruption by sustainable solutions.
Proven Impact 10x lower environmental footprint.
Expert founding team Founders Haïkel Balti and César Valencia bring deep expertise in biophysics and material sciences.
Early Traction: Secured partnerships with leading luxury brands for co-developing innovative applications.
Recent News from our Portfolio
Bohr Energie signs a commercial partnership with Enogrid - link
Entroview launches its first product to enhance battery State of Health diagnostics - link
Estuaire announce that Erin Smith has joined Estuaire as Business Developer - link
Inarix joins forces with DER AGRARHANDEL, Germany's largest private agricultural trade association - link
💰 Early-Stage Impact Rounds in France
Faircraft (€15M / Kindred Ventures, Heirloom, Entrepreneur First, Blue Wire Capital, Saké Bosch, AFI Ventures, CapHorn) produces an exciting substitute to leather, by creating the material in-vitro from just a few cells.
Hubcycle (€12M / ETF Partners, Raise, Techmind, Daphni, Citizen Capital, Swen Capital Partners, Bleu Capital) transforms industrial plant-based side-streams into valuable ingredients, creating new, sustainable value chains for clients, consumers, and the planet.
Primaa (€5.0M / Cenitz, Leia Capital, Clery, Business Angels) develops AI-powered software to rapidly and accurately detect cancer biomarkers.
Serenysun (€3.0M / Terra Nea) builds local renewable energy communities for sustainable energy transitions.
Trace For Good (€3.5M / Hi Innov, Ankaa Ventures, CentraleSupélec Venture, Seed4Soft ) offers supply chain traceability and CSR data management software.
Theremia (€3.0M / Eurazeo, Salica Investments, Tiny VC, Entrepreneur First)
develops an AI platform to personalize medical prescriptions based on patients' physiological characteristics.
Zen Modular (€1.3M / Unicraft, Kanopee) delivers fast, eco-friendly, and cost-effective modular construction solutions
Solteo (€1.5M / Axeleo Capital, Kima Ventures, Campus Fund) provides a platform to optimize the management of solar panel installers.
Valueco (€1.5M / 115K, Techstars, Business Angels) offers a solution to measure the financial impact of corporate ESG commitments.
Survoltage (€1.5M / Business Angels) provides a tool to monitor and adjust electricity consumption efficiently.
PimpUp (€1.7M / Business Angels) delivers weekly fresh French fruits and vegetables at the best price.
GR33T (€320K / Business Angels) engages employees in challenges to promote environmental policies and workplace well-being.
🤝 Our Team
Charles Fourault - charles@afi.ventures
Constantin de Chaudenay - constantin@afi.ventures
Juliette Lelievre - juliette@afi.ventures
Don't hesitate to reach out if you're an impact entrepreneur or just interested in any of these topics. 🍃