Tesco and Australian retail giant Woolworths have partnered to form W23 Global, a £99 million ($125 million) venture capital fund that will invest in retail technology start-ups.

The new fund will work on challenges such as emissions and waste reduction, packaging innovation, user experience, and product traceability and transparency.

Other companies joining the new fund include the Canadian retail conglomerate Empire Company, South Africa’s Shoprite Group, and the Netherlands-headquartered firm Ahold Delhaize.

Each retailer will contribute roughly £20 million ($25 million) and all the participating retailers will have an equal share in the ownership of the new fund.

Any decisions regarding which start-ups to invest in will be made by the chief executives of the respective firms.

W23 Global will run out of the same Sydney Australia-based office as Woolworth's domestically focused venture capital fund, W23.

Woolworth's domestic venture capital firm has previously invested in meal-kit seller Marley Spoon and telehealth start-up Eucalyptus.

W23 Global chief executive and chief investment officer Ingrid Maes said the company's "ambition is to offer our portfolio companies faster pathways to global scale, without being exposed to a venture fund anchored by a single strategic investor."

She added: "With five of the world’s leading grocery chief executives sitting on our investment committee and access to our broader ecosystem, our founders can test and develop their ideas quickly based on an accelerated understanding of retailers’ needs.”

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