Sustainability ratings business EcoVadis becomes latest FinTech unicorn

Sustainability ratings business EcoVadis has raised $500m in a funding round, which makes it the latest sustainability impact unicorn.

This funding round, which EcoVadis claims is the largest equity fundraising for a sustainability data SaaS company to date, brings its total equity raised to $725m.

UK-based private equity firm Astorg and BeyondNetZero, General Atlantic’s climate investing venture, served as the lead investors. Other contributions came from Singapore-based GIC and Princeville Capital’s Climate Technology Fund.

With the capital, the FinTech company hopes to scale-up globally, deepen its AI and machine learning capabilities, make strategic acquisitions and more.

Its services are used by over 95,000 businesses across 200 industry categories and 175 countries, leveraging it to monitor and improve the sustainability performance of their own business and trading partners. Its use cases include Scope 3 carbon emissions management, private equity, ESG-linked loans, supply chain finance, third-party risk and resilience and more.

It has been a strong year for EcoVadis, with its revenue growing by 50% and its team reaching 1,300 people.

BeyondNetZero managing director Rhea Hamilton said, “We believe EcoVadis has all the critical elements to make global impact and a meaningful contribution to the net zero transition, including a high-quality business model, strong leadership, innovative technology and a bold vision for driving ESG-oriented transformations across supply chains and industries.

“We are excited to back EcoVadis as the company enters a new phase of growth and look forward to partnering with its management team as we aim to further accelerate the company’s global expansion and climate impact.”

The FinTech company previously raised $200m from CVC Growth Partners II in January 2020 and $30m from Partech in 2016.

ESG is becoming a hot topic for financial institutions. A report from FT Adviser claims that 77% of UK banks, investment managers and financial advisers plan to hire an ESG specialist as they prepare for the UK’s new rules on sustainable investments.

More venture capital firms are also interested in ESG opportunities. According to FinTech Global’s data, Plug and Play Tech Center and Crowdcube have been the most active investors into ESG FinTech as of 18 May 2022.

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