Date of Publication: July 5, 2023; last updated September 23, 2026
I. NC Management GmbH
1. Transparency of Sustainability Risk Policies
Due to the investment focus and the nature of potential target companies in the technological/software sector, NC Management GmbH (“NC Management“, LEI: 391200WJQ18NB0INKL81) generally does not expect ESG events or conditions, if they occur, to cause an actual or a potential material negative impact on the value of investments or future returns (so-called “Sustainability Risks” within the meaning of SFDR). Sustainability Risks are therefore not prominently integrated into NC Management’s investment decisions.2. No Consideration of Adverse Impacts of Investment Decisions on Sustainability Factors
NC Management does not consider adverse impacts of its investment decisions on sustainability factors and, hence, does not use the sustainability indicators listed in Annex I of the Regulatory Technical Standards (Commission Delegated Regulation (EU) 2022/1288, “RTS”) to identify and assess potential adverse impacts.Sustainability factors mean environmental, social and employee matters, respect for human rights, anti‐corruption and anti‐bribery matters.
As the funds managed by NC Management may also hold significant minority interests or shares in portfolio companies, NC Management cannot constantly ensure access to the relevant data from portfolio companies for the assessment of principal adverse impacts on sustainability factors and cannot currently provide the information in relation to the consideration of adverse impacts of its investment decisions on sustainability factors as provided in the SFDR.
In addition, data collection and data quality are sometimes difficult for small portfolio companies, as data collection is often an economically disproportionate burden for the usually small management teams of portfolio companies.
3. Remuneration Disclosure
As a manager of European venture capital funds (EuVECA) registered in accordance with Regulation (EU) No 345/2013 on European venture capital funds (“EuVECA Regulation”) and as a registered alternative investment fund manager within the meaning of section 2(4) and 2(6) of the German Investment Code (Kapitalanlagegesetzbuch, “KAGB”), NC Management does not have a remuneration guideline or policy.II. NC Growth Fund I GmbH & Co. KG
1. Summary
NC Growth Fund I GmbH & Co. KG (“NC Growth Fund I”), managed by NC Management, promotes environmental and social characteristics.NC Growth Fund I focuses on equity and equity-related investments in growing tech companies mostly focusing on business-to-business software products that help to ease customers’ and employees’ lives, mainly in the DACH region.
NC Growth Fund I’s framework for integrating ESG matters in the lifetime of an investment incorporates four phases: sourcing and screening, pre-investment due diligence, portfolio, and exit.
Each investment is being assessed against a binding exclusion list relating to specific industries and products and will not pursued if it is in conflict with the exclusion list. The exclusion covers inter alia weapons or ammunition, hardcore pornography, tobacco, gambling and human cloning. 100% of the invested capital will be in line with the exclusion list which will be taken into account during the entire investment process.
Additionally, each investment will be examined for ESG related data before the investment and on a regular basis throughout the lifetime of the investment.
The ESG related data will be collected by NC Growth Fund I on a recurring basis from its portfolio companies. For this purpose, NC Growth Fund I uses a co-developed software platform to ensure thorough documentation of derived measures and overall ESG development per portfolio company. NC Growth Fund I monitors the ESG KPIs corresponding with the environmental and social characteristics and report them annually to its investors.
Throughout the holding period NC Growth Fund I actively engages with the portfolio company’s management to monitor and manage ESG matters. In cases where material ESG risks are identified and deemed inacceptable, a plan is developed and agreed with the management to improve or remedy the issue.
2. No Sustainable Investment Objective
NC Growth Fund I promotes environmental or social characteristics (Article 8 SFDR) but does not have sustainable investments as its objective (Article 9 SFDR).3. Environmental or Social Characteristics
NC Growth Fund I does not commit to make sustainable investments within the meaning of the SFDR or with an environmental objective aligned with the EU Taxonomy. However, NC Growth Fund I targets that all of its investments will be aligned with the environmental and social characteristics promoted by NC Growth Fund I.NC Growth Fund I promotes the following environmental and social characteristics:
4. Investment Strategy
NC Growth Fund I intends to build, hold and manage in its own name and for its own account a portfolio of equity and equity-related investments in growing tech companies mostly focusing on business-to-business software products that help to ease customers’ and employees’ lives. Those target companies typically have many of the following characteristics:- Predominantly founder-owned, i.e. have not been financed by the typical series A, B and other founding rounds;
- Founders have grown their company bootstrapped in a capital efficient way;
- Their (B2B-) software product has been diligently developed over a period of many years driven by customer requests;
- The target company has a scalable software product, only lacking the scale-up experience and the financial means for faster growth;
- The target company achieves sales of about € 3m - € 10m and is or is on the verge of being cash-flow break even, i.e. it is a proven business model since the company attracted enough customers that are willing to pay for the products. Hence this company is not a VC investment;
- The companies have a strong USP and operate in growing markets.
The investment strategy guides investment decisions based on factors such as investment objectives and risk tolerance. NC Growth Fund I intends to promote environmental and social characteristics as described above and has adjusted its investment strategy accordingly.
To measure how the environmental and social characteristics are attained, a proprietary framework based on the UN Principles for Responsible Investment (UN PRI) has been developed. Starting from the UN PRI, the Fund derived six company principles:
NC Growth Fund I applies a binding exclusion list that prevents NC Growth Fund I from investing into the following industries in order to attain the environmental and social characteristics of NC Growth Fund I:
- casinos or other gambling facilities;
- hardcore pornography or the sex industry;
- human cloning or genetically modified organisms (GMOs);
- coal mining and/or coal-fired power plants;
- a utilities company that derives 50% or more of its fuel mix from coal, unless such utilities company derives 10% or more of its fuel mix from renewable resources such as hydro, wind or solar;
- tobacco;
- weapons and ammunition; or
- development or production of nuclear weapons.
NC Growth Fund I is committed on best-in-class due diligence processes in various areas. Each potential investment is dissected in terms of commercials, technology, legal, tax as well as ESG characteristics. The ESG due diligence is based on NC Growth Fund I’s proprietary framework to ensure objectivity and measurability.
5. Proportion of Investments
NC Growth Fund I targets to invest 100% of its capital commitments in portfolio companies that meet the environmental and social characteristics promoted, particularly all investments shall be in line with the exclusion list as mentioned above in section II.3.NC Growth Fund I does not commit to make sustainable investments with an environmental objective aligned with the EU Taxonomy and will therefore not have a minimum share of investments in transitional and enabling activities.
6. Monitoring of Environmental or Social Characteristics
In order to attain the environmental and social characteristics promoted, NC Growth Fund I carefully monitors that its portfolio companies comply with the environmental and social characteristics promoted.To ensure an objective measurability of the promoted environmental and social characteristics, five maturity scenarios for each of the promoted characteristics have been developed. Each scenario precisely describes what a company has to do to reach the next maturity level in one specific characteristic. The following table shows an excerpt of the Maturity Scenario Matrix.
In addition, the proprietary Maturity Scenario Matrix was transferred into a co-developed software platform to ensure thorough documentation of Assessments, reasoning on assessed maturity levels as well as documentation of derived measures and overall ESG development per portfolio company. .
Yearly assessments are conducted on each portfolio company. To further ensure objectivity, the assessment is done in management sessions and further supplemented by extensive internal company documentation.
7. Methodologies for environmental or social characteristics
The methodology of NC Growth Fund I consists of strictly adhering to standards in the investment and holding period as specified in sections II.4 and II.6.8. Data Sources and Processing
Apart from its due diligence (as specified in section II.10.), monitoring and regular communication between the NC Management and NC Growth Fund I’s portfolio companies, NC Management does not conduct further research or investigations on a regular basis, at least as long as the data reported by the portfolio does not give rise to any reasonable doubts.9. Limitations to Methodologies and Data
Legal limitations may not allow NC Growth Fund I to ensure full compliance with all requirements set out by the SFDR. In particular, NC Growth Fund I cannot monitor the compliance of the “do not cause significant harm” principle in all its portfolio companies by economically reasonable means. It also assumes that monitoring and reporting on the compliance of this principle would place an economically disproportionate burden on the usually small management teams of its portfolio companies.10. Due Diligence
The assessment of how NC Growth Fund I’s potential investment in the potential portfolio company relates to the promoted environmental and social characteristics is carried out as part of the due diligence process prior to the investment. Further reviews may be conducted beyond such due diligence process and regular monitoring if, and to the extent, NC Management deems it appropriate to conduct an ad hoc review in a specific case. NC Management does not foresee to engage external service providers to assess the environmental and social characteristics of a potential investment.11. Engagement Policies
The due diligence process is supplemented by a considerable amount of management sessions to be able to assess good governance practices in person. In addition, presence of guidelines is thoroughly checked too. On the other hand, good governance practices are part of the ESG due diligence. Furthermore a tax due diligence is mandatory during the investment process to ensure tax compliance.12. Designated Reference Benchmark
The proprietary ESG framework referred to above also acts as a benchmark. No third party index has been designated.III. NC Growth Fund II GmbH & Co. KG
1. Summary
NC Growth Fund II GmbH & Co. KG (“NC Growth Fund II”), managed by NC Management, promotes environmental and social characteristics.NC Growth Fund II focuses on equity and equity-related investments in growing tech companies mostly focusing on business-to-business software products that have already achieved product-market fit, mainly in the GSA region (Germany, Switzerland and Austria), with up to 20% of capital commitments being invested outside the GSA region in Europe.
NC Growth Fund II’s framework for integrating ESG matters in the lifetime of an investment incorporates four phases: sourcing and screening, pre-investment due diligence, portfolio, and exit.
Each investment is being assessed against a binding exclusion list contained in the Limited Partnership Agreement of NC Growth Fund II relating to specific industries and products and will not be pursued if it is in conflict with the exclusion list. The exclusion list covers inter alia weapons or ammunition, hardcore pornography, tobacco, gambling and human cloning. 100% of the invested capital will be in line with the exclusion list which will be taken into account during the entire investment process.
Additionally, each investment will be examined for ESG related data before the investment and on a regular basis throughout the lifetime of the investment.
The ESG related data will be collected by NC Management on behalf of NC Growth Fund II on a recurring basis from its portfolio companies. For this purpose, NC Management uses a co-developed software platform to ensure thorough documentation of derived measures and overall ESG development per portfolio company. NC Management monitors the ESG KPIs corresponding with the environmental and social characteristics and reports them annually to NC Growth Fund II's investors.
Throughout the holding period NC Management, on behalf of NC Growth Fund II, actively engages with the portfolio company’s management to monitor and manage ESG matters. In cases where material ESG risks are identified and deemed inacceptable, a plan is developed and agreed with the management to improve or remedy the issue.
2. No Sustainable Investment Objective
NC Growth Fund II promotes environmental or social characteristics (Article 8 SFDR) but does not have sustainable investments as its objective (Article 9 SFDR).3. Environmental or Social Characteristics
NC Growth Fund II does not commit to make sustainable investments within the meaning of the SFDR or with an environmental objective aligned with the EU Taxonomy. However, NC Growth Fund II targets that all of its investments will be aligned with the environmental and social characteristics promoted by NC Growth Fund II.NC Growth Fund II promotes the following environmental and social characteristics:
4. Investment Strategy
NC Management intends to build, hold and manage on behalf of NC Growth Fund II a portfolio of equity and equity-related investments in growing tech companies mostly focusing on business-to-business software products that have already achieved product-market fit, mainly in the GSA region (Germany, Switzerland and Austria), with up to 20% of capital commitments being invested outside the GSA region in Europe. Those target companies typically have many of the following characteristics:- Predominantly founder-owned and often bootstrapped;
- Proven business models with revenues typically exceeding €3 million, demonstrating strong capital-efficient growth and cash flow break-even or a clear path to positive cash flows;
- Scalable technology-driven products or business models with defensible competitive advantages, proprietary know-how, and compelling customer value propositions;
- Well-positioned in growing markets benefiting from long-term structural tailwinds, with strong customer retention, high switching costs, mission-critical use cases, or other characteristics supporting durable market positions and sustainable growth;
- Led by ambitious, execution-oriented management teams with strong alignment of interests and a long-term entrepreneurial mindset.
The investment strategy guides investment decisions based on factors such as investment objectives and risk tolerance. NC Growth Fund II intends to promote environmental and social characteristics as described above and has adjusted its investment strategy accordingly.
To measure how the environmental and social characteristics are attained, NC Management has developed a proprietary framework for NC Growth Fund II based on the UN Principles for Responsible Investment (UN PRI). Starting from the UN PRI, NC Management derived six company principles for NC Growth Fund II:
NC Growth Fund II applies a binding exclusion list that prevents NC Growth Fund II from investing into the following industries in order to attain the environmental and social characteristics of NC Growth Fund II:
- operation of casinos or other gambling facilities;
- hardcore pornography or the sex industry (including, without limitation, any activity of prostitution or procuring of prostitutes);
- human cloning or genetically modified organisms (GMOs);
- coal mining and/or coal-fired power plants;
- a utilities company that derives 50% or more of its fuel mix from coal, unless such utilities company derives 10% or more of its fuel mix from renewable resources such as hydro, wind or solar;
- manufacture or sale of tobacco;
- manufacture or sale of firearms (the term “firearms” shall include handguns and assault rifles, but shall not include other military equipment), cluster munitions, landmines and/or any other similar weapons, offensive armaments, or ammunition to be used in the act of war or military conflict (for the avoidance of doubt, any weapons, equipment or items used in games and the related gaming industry (Spieleindustrie) shall not be restricted) provided, however, that any Defense-Related Investment as defined under the LPA shall not be restricted if the prior approval of the Investors Advisory Board has been obtained in accordance with the LPA; or
- development or production of nuclear weapons.
For the avoidance of doubt, dual-use technologies and services, i.e. solutions that may serve both civilian and military services, shall not be subject to the restrictions set out above. Furthermore, any portfolio company whose principal activities and business revenues are substantially based on any services provided to or the delivery of any products to restricted companies under the exclusion list set out above shall not be tainted and not be deemed itself to be a restricted company under the exclusion list (this shall include, but not be limited to portfolio companies which are primarily engaged in the production, manufacture or sale of computer technology, optical instruments, high-precision equipment, communications equipment, software, medical supplies, vaccines or similar items).
NC Growth Fund II assesses the good governance practices of the portfolio companies including with respect to sound management structures, employee relations, remuneration of staff and tax compliance, and is committed on best-in-class due diligence processes in various areas. Each potential investment is dissected in terms of commercials, technology, legal, tax as well as ESG characteristics. The ESG due diligence is based on NC Growth Fund II’s proprietary framework to ensure objectivity and measurability.
5. Proportion of Investments
NC Growth Fund II targets to invest 100% of its capital commitments in portfolio companies that meet the environmental and social characteristics promoted, particularly all investments shall be in line with the exclusion list as mentioned above in section III.3. NC Growth Fund II may invest in portfolio companies directly or indirectly.NC Growth Fund II does not commit to make sustainable investments with an environmental objective aligned with the EU Taxonomy and will therefore not have a minimum share of investments in transitional and enabling activities.
6. Monitoring of Environmental or Social Characteristics
In order to attain the environmental and social characteristics promoted, NC Management carefully monitors on behalf of NC Growth Fund II that its portfolio companies comply with the environmental and social characteristics promoted.To ensure an objective measurability of the promoted environmental and social characteristics, NC Management has developed five maturity scenarios for each of the promoted characteristics. Each scenario precisely describes what a company has to do to reach the next maturity level in one specific characteristic. The following table shows an excerpt of the Maturity Scenario Matrix.
In addition, the proprietary Maturity Scenario Matrix was transferred into a co-developed software platform to ensure thorough documentation of Assessments, reasoning on assessed maturity levels as well as documentation of derived measures and overall ESG development per portfolio company.
NC Management conducts yearly assessments on each of NC Growth Fund II's portfolio companies. To further ensure objectivity, the assessment is done in management sessions and further supplemented by extensive internal company documentation.