Colesco takes over $1bn Article 9 impact debt fund from Polestar: ‘A pivotal moment’

Netherlands-based Colesco Capital has taken over management of Polestar Capital’s $1bn Circular Debt Fund (PCDF).

The Article 9 fund will be renamed Colesco Circular & Climate Credit Impact Fund, effective January 1, 2026. Under the deal, Polestar’s entire investment team will transfer to Colesco, to give existing investors and borrowers consistency.

“This marks a pivotal moment in our journey towards becoming a leading responsible investment manager,” said Danny Vroegop, Colesco’s co-founder and CEO.

Vroegop co-founded Colesco alongside Robin Van den Brandhof in 2023, after the pair worked in the private debt team of Dutch financier Rabobank.

For its first fund, Colesco secured cornerstone backing from APG and Rabobank, raising over $800m by early 2024.

Growth capital for climate tech

By taking over Polestar’s fund, Colesco will continue where Polestar left off: backing growth stage companies across circularity, resource efficiency, and climate mitigation.

Some of Polestar’s previous investments from the fund include Dutch companies BioBTX, Circtec, Xycle, and Uppact, which all turn waste into circular or renewable products.

Loans and credit lines are becoming an increasingly important source of capital for clean tech companies looking to scale.

In 2024, debt financing surpassed private equity as the largest source of capital for European climate tech, with over $20bn in loans issued versus $13.6bn in private equity, according to Dealroom data.

“That kind of shows a growing-up in the sector,” Craig Douglas, founder partner at World Fund, recently told Impact Loop. “Many [climate tech] business models shouldn’t need huge amounts of equity to scale. It’s good they’re getting more non-dilutive capital."