Closed Loop Partners (CLP), a New York-based investment firm focused on building a circular economy, has announced the successful final close of its Closed Loop Leadership Fund, a private investment fund that manages in excess of $200 million of total assets, according to the organization.
According to CLP, the fund’s strategy centers on scaling business models that advance circular supply chains to keep packaging, organics, electronics and apparel out of landfills and within a circular system.
“Transitioning to a circular economy represents a capital shift of $4.5 trillion by 2030, according to research,” says Lynn Baranski, global head of investments for BlackRock Private Equity Partners. “There are strong tailwinds of consumer demand, cost savings and resiliency driving the shift away from a linear economy.
“Closed Loop Partners has the expertise, thought leadership and differentiated execution ability to help capture the opportunity of this shift and drive positive economic, social and environmental outcomes through its investments.”
The Closed Loop Leadership Fund’s first investment was acquiring Balcones Resources in October 2019. The Austin, Texas-based company handles commercial and residential recycling, among other services, in Texas and Arkansas at its three material recovery facilities (MRFs) in Austin, Dallas and Little Rock, Arkansas.
“Together, we will be able to enhance employee opportunities, services to our customers and assist in achieving a diverse set of ambitious environmental goals,” Balcones chairman and CEO Kerry Getter said at the time of the announcement.
In April, the San Antonio City Council approved an ordinance awarding Balcones a 15-year municipal recycling contract that will begin Aug. 1, 2024. Under the terms of the contract, Balcones will build and operate a 200,000-square-foot, $47 million MRF and recycling education center in San Antonio, combining the latest innovations in recycling technology with employee wellness and community engagement programs, according to the company. The recycling facility will be Balcones’ sixth and its fourth in Texas.
CLP then announced in January the Closed Loop Leadership Fund led a consortium of investors to acquire the majority stake of Sims Municipal Recycling (SMR), which manages New York City’s municipal recycling contract—the largest in North America. SMR operates three recycling facilities in the New York-New Jersey Metro region and one facility in Florida. It’s Brooklyn MRF is the largest dual-stream recycling facility in North America.
At the time of the SMR acquisition, CLP said its investment was expected to further modernize circular economy infrastructure and service in the New York-New Jersey Metro region and expand SMR’s operations into new markets.
According to CLP, the Closed Loop Leadership Fund portfolio helps keep over 920,000 tons of recycled material in play per year, and its investments have kept 3.6 million tons of material in circulation. The CLP platform has made over 60 investments since its inception in 2019.
Kirkbi, based in Denmark; funds and accounts managed by New York-based BlackRock; and Denmark-based Realdania’s mission-driven investment arm join existing investors including Nuveen, Nestlé, Microsoft, PepsiCo, Unilever, SK Geo Centric Co. Ltd in CLP’s buyout strategy focused on building circular economy platforms across sectors.
“[T]he Closed Loop Leadership Fund…has made significant strides acquiring and building businesses at the forefront of developing circular supply chains at scale,” CLP founder and CEO Ron Gonen says. “This final close of the fund, which includes a number of leading investors, is a milestone for the development of the circular economy.”