• $220 million raised at first close, exceeding 70% of $300 million target and surpassing the firm’s previous $188 million fund
• Fund targets financing nearly two million tonnes of recycling capacity across South and Southeast Asia
• Investments projected to prevent 30 million tonnes of waste and reduce over 50 million tonnes of CO2 emissions over ten years

Circulate Capital has secured $220 million at the first close of its second Asia-focused fund, positioning itself ahead of a challenging global fundraising environment and reinforcing investor appetite for circular economy infrastructure in emerging markets.

The raise already exceeds 70% of the fund’s $300 million target and outpaces the firm’s first fund, which closed at $188 million. The new vehicle, Circulate Capital Asia Fund II, will deploy growth capital into recycling and circular supply chains across South and Southeast Asia, targeting sectors where material recovery remains underdeveloped but demand is accelerating.

The strategy reflects a broader shift among institutional investors who are increasingly treating circularity as core infrastructure rather than a niche sustainability allocation.

Global Investors Double Down on Circularity

The fund attracted a mix of multinational corporates, development finance institutions, and institutional investors, underscoring the convergence of commercial and climate priorities.

Returning investors include The Coca-Cola Company, Danone, Dow, and Procter & Gamble, alongside development finance institutions such as British International Investment, Proparco, and the International Finance Corporation. Builders Vision also renewed its participation.

New capital came from the Emerging Markets Climate Action Fund, backed by Allianz Global Investors and the European Investment Bank, as well as Achmea Investment Management, Impact Fund Denmark, SIFEM, and Australian Development Investments. Family offices and impact investors further diversified the base.

Jean-Yves Krummenacher, Global Chief Procurement Officer at Danone, said, “Building circular supply chains takes long-term commitment and strong collaboration across the value chain. Our reinvestment in Circulate Capital through Asia Fund II reflects our belief that scaling inclusive recycling systems is essential to keep materials in use, strengthen local ecosystems, and build more resilient supply chains. Through this partnership, we see an opportunity to develop solutions that create lasting value for people, industry, and the planet.”

Keith Cleason, President, Packaging & Specialty Plastics at Dow, said, “Circulate Capital’s initiative has delivered tangible impact in areas key to progressing circularity across the ecosystem, such as expanding capacity of mechanical recycling and enabling flexible recycling. Dow remains committed to bringing together ideas from across the value chain to deliver new solutions in circularity, and we look forward to continued collaboration as Fund II builds on this momentum in South and Southeast Asia.”

Targeting High-Growth Markets With Structural Gaps

Fund II will focus on key markets including India, Indonesia, Thailand, Vietnam, the Philippines, and Malaysia, where rapid consumption growth is outpacing waste management infrastructure.

The investment pipeline spans scaling PET recycling, developing markets for polyolefins, advancing paper-based packaging alternatives, and recovering valuable materials from electronic waste and batteries.

Chris Wu, Vice President of Investments at Builders Vision, said, “Participating in Circulate Capital’s Fund II is a natural next step for us, given the firm’s proven track record and our existing partnership. What truly sets Circulate apart is their combination of deep regional expertise across South and Southeast Asia and strong relationships with multinational corporations. Paired with a rigorous approach to impact measurement and a clear ability to cultivate proprietary deal flow in the region, they have developed a distinctive advantage in sourcing high-quality opportunities in the circular supply chain. We look forward to continuing to build alongside a team that is demonstrating how addressing the plastic crisis can be both scalable and commercially compelling.”

Peter Ellersiek, Co-lead Portfolio Manager at the Emerging Market Climate Action Fund, said, “We decided to support Circulate Capital with EMCAF because their specialist focus enables a clearly differentiated market positioning and delivers tangible value to portfolio companies and investors alongside strong environmental impact.”

Circular Economy Moves Into Core Investment Strategy

The momentum behind Fund II reflects deeper structural drivers reshaping global supply chains. The world currently consumes more than 100 billion tonnes of raw materials annually, yet only 7.2% of those materials are cycled back into the economy.

This imbalance is exposing manufacturers to price volatility, supply disruptions, and tightening regulation. At the same time, plastics alone represent a $100 billion investment opportunity in recycling and collection infrastructure by 2030.

Governments across Asia are increasingly aligning industrial policy with circular economy objectives, viewing domestic recycling capacity as both an environmental priority and a lever for economic resilience.

RELATED ARTICLE: BackBay Communications Promotes George Spencer to Head of Impact Investing & ESG Team

Proven Track Record Strengthens Investor Confidence

Circulate Capital’s Asia platform has built a measurable track record since 2020, adding nearly 900,000 tonnes of annual recycling capacity across its portfolio.

The firm has also demonstrated exit capability, including a full exit from Recykal, an India-based digital waste management platform, and partial exits from Lucro and Srichakra Polyplast, both focused on complex plastic recycling.

Rob Kaplan, Founder and CEO of Circulate Capital, said, “Circulate Capital is the first and only private markets manager to bet exclusively on circular supply chains across South and Southeast Asia. Our track record of successful exits demonstrates that the circular economy is no longer just a subset of ESG or sustainability. It is a sophisticated asset class that can deliver liquidity to private equity investors. With Fund II, we are ready to scale and capture the massive growth potential inherent in these high-velocity economies, to build businesses that deliver financial and impact returns for our investors.”

Scaling Impact Alongside Returns

Fund II is targeting nearly two million tonnes of additional recycling capacity. Over a ten-year horizon, the firm projects its investments will prevent 30 million tonnes of unmanaged waste and avoid or reduce more than 50 million tonnes of CO2 emissions.

At least half of the portfolio is expected to align with gender-smart investing criteria at exit, reflecting the growing integration of social metrics alongside environmental performance.

For investors and corporates, the implications are clear. Circular supply chains are evolving into a core component of industrial strategy, with capital increasingly directed toward markets where growth, policy alignment, and environmental need intersect.

ESG News Editorial Team

The ESG News Editorial Team is comprised of veteran financial journalists and sustainability analysts dedicated to providing real-time, objective reporting on global ESG regulations, climate finance, and corporate governance. Our desk monitors daily developments from the SEC, IFRS, CSRD and international regulatory bodies to ensure our 1M+ readers receive accurate, data-driven insights into the evolving sustainable investment landscape. Follow the ESG News Editorial Team for expert reporting on global sustainability standards, ESG disclosures, and climate policy. Access over 10,000 investigative reports and real-time updates.