Manon Sarah Littek is co-founder of the Green Generation Fund and first winner of the new KfW Capital Award in the “Best Female Investor” category. The venture capital fund Extantia Capital has been named “Best Impact Investor”. KfW Stories met Manon Sarah Littek and Sebastian Heitmann, partner at Extantia, to gain some insight into the VC brand in Germany.
Ms Littek, you and your business partner Janna Ensthaler launched the Green Generation Fund this summer with a fund volume of 100 million euros, which was regarded as a great success in the market. What is your investment focus?
MANON SARAH LITTEK With the Green Generation Fund, we focus on the categories of food tech and green tech. We will no longer achieve the 1.5-degree climate target, and according to experts, the 2-degree climate target is already at risk without any change in course. The planet is also showing us its limits in terms of resource consumption and biodiversity. We need to act now. We are convinced that innovations in the areas of green tech and food can create significant solutions and are therefore the most important topics of our time. Our investment focus is strongly influenced by the backgrounds of Janna Ensthaler and myself. As a food investor, I have been active as a general partner since 2016 and through my investments I have been able to help shape the food revolution in Europe and the USA from the very beginning. So my investments will continue to focus strongly on the agrifood sector in the area of Advanced Alt Protein, Biomass and Precision Fermentation as well as Cell Cultivation and Food-as-a-Medicine. Janna Ensthaler has been an entrepreneur in the classic tech sector for a long time. In green tech, she has so far invested primarily in platform and software business models.
Dr Manon Sarah Littek
Manon Sarah Littek was given the KfW Capital Award in the category of Best Female Investor 2022. Littek holds a PhD from FU Berlin and studied at Oxford University. Together with serial founder Janna Ensthaler, she founded the Green Generation Fund impact fund, which has already raised 100 million euros from over 30 investors after an oversubscribed first closing. The Green Generation Fund invests in food tech and green tech start-ups at the seed stage. Littek is a pioneer in food tech and has been a lead investor in Europe, the US and Israel for 15 years. She was CEO of Katjesgreenfood and Managing Director of DLD Ventures (Hubert Burda Media). She sits on the Supervisory Board of Upfield, the world’s largest plant-based food company.Read more
Do you still have to compromise on returns if you invest in green tech or food tech?
LITTEK No, quite the contrary. Solutions in food tech and green tech affect the most critical ecosystems of our time. Think about climate change, the finite nature of natural resources, but also supply chain and food security as the world population increases: to have a positive impact here, extreme progress is required in both areas. In contrast to most generalist impact funds, our investments are more focused and we expect returns comparable to those of established tech funds. Investor interest is high.
You invest in America, but always with an eye on Germany. Your registered office is in Berlin. How do you rate the start-up scene in Germany – in comparison to the USA and other countries as well?
LITTEK In the world of food tech, Germany is regarded worldwide as an engine for innovation and progress, thanks to strong universities such as TU Munich, RWTH Aachen and cooperation with research institutes such as the Fraunhofer Institute. We see significantly more depth in development at an early stage, especially with deep-tech and biotech approaches. In addition, a strong scene of angel and seed investors has established itself here. Compared to Asia and the USA, however, we are still lagging behind significantly in terms of capital. Growth capital is still lacking in Germany.
KfW Capital is honouring outstanding personalities from the venture capital (VC) ecosystem with the KfW Capital Award, which is being presented for the first time this year. Specifically, with the KfW Capital Award Best Female Investor, KfW Capital honours female VC investors who, among other things, successfully invest in start-ups and innovative technology companies in Germany. The KfW Capital Award Best Impact Investor focuses on female and male investors who have defined impact as an integral part of their investment strategy and invest in start-ups and innovative technology companies in Germany, among other things.Read more
You have been interested in healthy food for decades, and are vegetarian yourself. You also have a strong professional connection to the topic of food tech. Why did you make this particular topic your profession?
LITTEK That’s true. I was interested in my nutrition as a child, and asked a lot of questions. I became a vegetarian when I was four years old. My conviction in purely plant-based products began when it was about animal welfare. Later, I focused on a healthy lifestyle and then added topics such as climate and nutrition. That explains my affinity. As an investor, I see that food is the largest market in the world. At the same time, our population continues to grow, and we can see that most of the world’s resources will eventually be depleted. There are many exciting innovations and technologies with a real impact in this area that pique my interest, and I am thrilled by the rapid development of recent years and months.
From the jury's statement
“Dr Manon Sarah Littek brings extensive investment and portfolio management experience to the table and has proven over many years that she is a very successful investor who always manages to identify outstanding business ideas and entrepreneurial personalities. For more than six years, she has primarily invested in the food tech sector, in companies that mainly focus on more sustainable and healthier nutrition and thus positively transform consumer behaviour.”
Can you explain to us what is particularly exciting in the food tech sector at the moment?
LITTEK One major focus in the market right now is still – quite rightly – alternative protein sources. This is because mass farming and traditional agriculture are responsible for a third of the climate crisis, they consume 70% of the fresh water and take up 40% of the land. As the world's population increases from 8 to 10 billion people, we will have to massively transform traditional agriculture if we want to feed everyone and still preserve the planet. The biggest levers here are non-animal alternative proteins and a transformation of agriculture into a sustainable and regenerative form. Our portfolio company Neggst is also active here – and is developing the first plant-based egg with a shell. Neggst, incidentally, is a spin-out from the Fraunhofer Institute. There are also exciting new technology developments regarding new protein in the area of Precision Fermentation and mycelium. Instead of being made by cows, milk proteins are produced in steel containers by microorganisms as the “mother”, such as at our portfolio company Change Foods. This form of production is important especially in the crisis because it represents an independent regional supply chain and is resistant to all weather influences. Many sovereign wealth funds in the Middle East and Asia are currently investing heavily in this area. Otherwise, I consider topics such as Food-as-a-Medicine, regenerative agriculture and solutions for the bioeconomy as central for the coming years.
In October, you received the KfW Capital Award for “Best Female Investor”. What can you tell us about becoming a successful investor?
I read a lot and very widely, and I'm generally a curious person. This is important because it is the only way to gain the market knowledge you need to understand today’s problems and the trends of tomorrow. This is what being an investor is all about. You have to have a good feel for future trends, i.e. anticipate the business models of the future. You also need a fine rapport with people. Ultimately you need perseverance, especially at the beginning of your career.
Mr Heitmann, you invest in climate tech with Extantia. What is your investment focus?
SEBASTIAN HEITMANN To pursue a clearly defined ambition, we convert our impact into avoided or withdrawn CO2e. Here, the “e” stands for “equivalent”; this is important if other greenhouse gases such as methane are the focus of the measures. Two issues are decisive: the impact must be achieved on a certain scale. Our aim is that a technology we invest in must have the potential to save or remove at least 100 MT of CO2e by day X. This is ambitious considering that Germany emits approximately 800 MT/year. So we are looking for the big solutions.
The timing of the impact is also very important to us: we must prevent certain climate tipping points from being reached, because afterwards, everything becomes much more complicated and expensive. We follow a well-known but slightly modified principle. We call it the time value of CO2e. One tonne of CO2e that we avoid or remove today is worth much more than if it were to happen in 2040. Both issues create an investment focus that places great importance on the transformation of existing infrastructures.
The winner of the KfW Capital Award for Best Impact Investor is the VC fund Extantia Capital, whose name is derived from the Latin existentia (existence). Extantia Capital only invests in start-ups that make a significant technological contribution to reducing CO2 emissions with their product. As an impact fund, Extantia Capital expects the same returns as conventional VC funds. Its team includes four other partners.Read more
Let’s look at your portfolio: what is the most innovative idea for you?
It’s difficult to choose as all companies are working on very relevant topics. If I may interpret the question as to which companies have the greatest potential impact, then that would be companies working on the development of new energy sources. Our basic problem today is that not all electrons in the grid are generated in the same way and currently there are not enough base-load capable renewable energy sources. For example, our portfolio company “GA Drilling” works in the area of geothermal energy, and the start-up “Reversion” in the area of biomass/biogas – both are companies that use very innovative technology to feed more green electrons into the grid whenever the sun is not shining or the wind is not blowing.
You personally have been working in the field of climate tech for a long time. What has changed the most over the years when it comes to dealing with investors?
My observation is that a new generation of investors is increasingly taking the reins. This generation has grown up with the problem of global warming and is willing to act. In addition, thanks to the excellent work of thousands of scientists, there is now an overwhelming body of data that rules out any other conclusions. If we fail to decouple our prosperity from CO2e consumption, we will face serious problems.
From the jury's statement
“Extantia’s team is fully committed to driving decarbonisation and thereby mitigating climate change. The personal and professional experience of the team in the areas of investments, company building and portfolio management, as well as the focus on climate tech and Extantia Capital’s commitment to the VC ecosystem, show that ‘impact’ is an inherent part of their strategy. Extantia Capital has demonstrated in an outstanding way that market conformity and a focus on sustainability are not mutually exclusive, but harmonise well and will be increasingly dependent on each other in the future.”
Germany as an investment location – what do you consider its strengths and weaknesses?
Germany offers an ideal breeding ground in the area of climate tech. With the large number of technical universities and institutes such as Leibniz, Helmholtz, Max Planck and Fraunhofer, we have a long tradition of cutting-edge research in the high-tech sector. In terms of scaling, we also have outstanding companies from SMEs to the DAX group that know how to industrialise solutions. What we have not yet sufficiently succeeded in doing is bringing this knowledge to successful commercial spin-offs. The next Amazons and Googles will be climate-tech companies, and Germany can play a global pioneering role here.
With Extantia, your team has been given the KfW Capital Best Impact Investor award – what do you think makes a good “impact” fund?
Transparency and measurability should be a priority. The team should be measured and remunerated based on the achievement of the impact goals. In the end, however, as is so often the case, it is the individual team members and the motivation of each and every one of them that make the difference. We try to act on the subject with little ideology and a good sense of pragmatism. Proscriptions and restrictions are not effective enough at global level. Our role is to help new technologies break through and give existing industries the necessary impetus in the transformation.
Published on KfW Stories on 10 November 2022.