FASE and Chi Impact Capital Join Forces
When two forces in the impact space decide to move forward together, the result is more than just a larger balance sheet. The recent merger between FASE (the Finance Agency for Social Entrepreneurship) and Chi Impact Capital is an intriguing case in how strategic alignment can bridge the financing gaps that still plague European social enterprises.
By joining forces, the two organisations have launched the European Catalytic Impact Investing Fund II (ECIIF II). This new vehicle targets the so-called "missing middle": early-stage companies that have moved beyond the seed phase but find themselves both too slow-growing for traditional venture capital and too risky for mainstream banks. The fund is classified as SFDR Article 9, representing the highest level of sustainability disclosure under European regulations.
A multiplier for European impact
The decision to merge grew from a shared realization: the challenges facing European impact ventures in climate, health, and education are too large for fragmented players to solve alone. For Chi Impact Capital, based in Switzerland, and Germany’s FASE, the move was a natural evolution motivated also by a long-standing mutual respect.
“Teaming up has been a true multiplier for us,” says Christine ter Braak-Forstinger, founder of Chi Impact Capital and now co-founder of ECIIF II. The combined platform provides the scale necessary to attract institutional investors while maintaining the deep, hands-on impact expertise both firms are known for.
The fund aims to raise €80 million, with a hard cap of €120 million. A significant element of this structure is a €10 million guarantee from the European Investment Fund (EIF). This catalytic capital layer de-risks the portfolio, allowing the fund to offer flexible financing like mezzanine capital and convertible loans that traditional equity-only funds often avoid.
Collaboration as a core value
In the impact world, collaboration is frequently discussed but harder to execute at the corporate level. This merger proves that even established intermediaries are willing to rethink their own structures to better serve the ecosystem.
Markus Freiburg, founder of FASE and co-founder of ECIIF II, views the merger as a way to expand what is considered "financeable." He notes that the core idea is to broaden the universe of impact ventures, particularly those that do not fit the typical "unicorn" profile but offer essential systemic solutions.
The synergy between the two teams is evident in how they have integrated their focus areas. FASE brings a track record in social innovation, education, and care, while Chi Impact Capital adds deep expertise in regenerative economics and the circular economy.
The new fund will focus on northern Europe, writing checks between €1 million and €3 million. It is an intentional effort to support companies that prioritize long-term resilience over rapid exits.
“We are backing companies in the missing middle,” explains ter Braak-Forstinger. These are firms that may not become tech giants overnight but are fundamental to a sustainable economy—the "Mittelstand" of the impact world.
Unlike traditional VC funds, ECIIF will engage also with social enterprises that are organised via steward-ownership models, cooperatives, or hybrid models, meaning that they are not singularly focused on an eventual sale of the company.
By combining their vast experience, the merger creates a robust framework for managing both financial performance and real-world outcomes more effectively. Crucially, the merger is a reminder that real impact is rarely made in isolation, and that collaboration is more often than not a necessity to take the next step forward.