LONDON & SAN FRANCISCO--(BUSINESS WIRE)--Generation Investment Management, a pure-play sustainable investment manager with over $36 billion of assets under management, today announced the launch of its $1.7 billion Sustainable Solutions Fund IV. The new fund continues the firm’s commitment to invest globally in companies and teams driving the sustainable future.
Sustainable Solutions Fund IV is Generation’s fourth and largest Growth Equity fund, enabling Generation to invest $50-$150 million as active minority investors in high-growth companies that are shifting industries toward sustainability and responsible innovation at scale. The firm’s prior Growth Equity funds have deployed over $2 billion since 2008, partnering with companies such as AlayaCare, Asana, Back Market, Benevity, Convoy, Gusto, Pivot Bio and Toast, amongst others.
Lila Preston, Head of Growth Equity at Generation Investment Management, said: “We’ve been researching the changes needed for a sustainable future, and investing in pioneering companies driving that transition for over 15 years. Our systems-level view helps us identify industries, companies and entrepreneurs that can scale sustainable solutions globally. We believe this helps us to see value where others don’t, and add value where others can’t.”
Investment Focus
Sustainable Solutions Fund IV will continue to focus on investing in growth-stage businesses with proven technology and mission-driven management teams in:
- Planetary health: net-zero-carbon solutions transforming mobility, agriculture, energy and enterprise by reducing waste and emissions, and enhancing biodiversity
- People health: enabling better health outcomes and a lower-cost, more accessible healthcare system
- Financial inclusion: supporting access to finance, reducing inequality and supporting an equitable future of work
All potential portfolio companies are evaluated for not only their business and management quality, but also their ‘System Positive’ contribution, to ensure they are clearly driving the transition to a more sustainable future. This analysis measures the first and second-order effects of a business model on people and planet, including implications of its products, supply chain, organisational culture and broader role in society.
David Blood, Senior Partner of Generation Investment Management, said: “Sustainability has been and will always be at the core of our mission, but we know we cannot achieve this mission on our own. We believe partnership is the way to succeed. When companies and entrepreneurs work with Generation, they don’t just get a single point of contact. They gain access to our team, extended network and a continuum of capital across private and public equity to help them scale and transform, and to bring system-positive change for generations to come.”
Differentiated Approach
With a presence in London and San Francisco, Generation’s Growth Equity team of 17 people, representing 10 nationalities, offers portfolio companies a diversity of thinking and perspective. The team delivers a differentiated partnership approach to its portfolio, including:
- Deep sustainability insight: The Growth Equity team has authored more than 150 deep research roadmaps that outline macro and long-term industry trends in the sectors most poised for disruption and sustainable growth. The roadmaps, which have tracked secular shifts including the electrification of the transportation industry (2014), adoption of alternative proteins (2015), the rise of remote collaboration tools (2016), circular economy marketplaces (2017), personalised medicine (2018) and digital remittances (2019), amongst others, allow the team to establish criteria for what sustainable, high-quality business models look like and to track the leading companies and management teams with which to develop relationships.
- Extended network and advisors: Since the firm’s founding 18 years ago, Generation has developed a deep and global sustainability network, cultivating a bench of top industry executives who serve as formal and informal advisors. These advisors, who often also serve in a board capacity, help accelerate portfolio company growth and business building, leveraging extensive experience in operations, people development, sales execution and scaling sustainable growth-stage businesses.
- Convening power: Generation taps its network to bring together diverse groups of leaders including experienced executives, entrepreneurs, policy-makers and academics for Solution Summits to discuss and debate important timely topics and build affinity networks to problem-solve together. Recent topics have included Green Data, Pay Equity, Upskilling/Reskilling, Corporate Decarbonisation and Future of Supply Chain, amongst others.
Sustainable Solutions Fund IV has a global and diverse institutional investor base, including many returning LPs.
Sustainability and Impact Report
Also today, the Growth Equity team released its Sustainability and Impact Report 2021 for Sustainable Solutions Fund III. Highlights include:
- Strong disclosure: 100% of the private portfolio reported its full Scope 1, 2 and 3 emissions for the second year running – with like-for-like emissions intensity decreasing by 30% in 2021.
- Deeper transparency: Generation helped its five most recent investments in the fund to measure comprehensive environmental and social impact at the product level for the first time.
- Gender inclusion: The report captured the non-binary gender category for the first time, with 42% of portfolio company management and 25% of board members identifying as female or non-binary.
About Generation Investment Management
Generation Investment Management LLP is dedicated to long-term investing, integrated sustainability research and client alignment. It is an independent, private, owner-managed partnership established in 2004 and headquartered in London, with a US presence in San Francisco, with more than $36 billion of assets under management (as of 31 March 2022).
For further information, please visit www.generationim.com.
Important Note
This document is neither intended as marketing material nor as a financial promotion; rather it is intended solely to provide general background information on the close of Generation IM Sustainable Solutions Fund IV, ILP (the “Fund”). When open for subscription, the Fund was only available to a limited number of sophisticated investors, in accordance with applicable private placement rules. No public offer of interests in the Fund was made in any jurisdiction. The Fund is now closed and no further issuance of interests in the Fund will be made. Consequently, this document is for information purposes only.
Generation Investment Management LLP (“Generation UK”), is authorised and regulated by the Financial Conduct Authority of the United Kingdom and reports to the U.S. Securities and Exchange Commission (“SEC”) as an Exempt Reporting Advisor. Generation UK is the parent entity of Generation Investment Management US LLP ("Generation US"), an investment adviser registered with the SEC. Registration as an investment adviser with the SEC does not imply a certain level of skill or training. Generation UK and Generation US may only transact business in any state, country, or province if they or their affiliates (as applicable) first are registered, or excluded or exempted from registration, under applicable laws of that state, country, or province.
While the information contained in this document is believed reliable, Generation makes no representation that it is accurate or complete and it should not be relied upon as such. Generation is not responsible for amending, correcting, or updating any information or opinions contained herein, and it accepts no liability for loss arising from the information contained in this material. Any opinions expressed are present opinions only. Companies listed have been selected on objective non-performance-based criteria solely for the purpose of illustrating the Growth Equity team’s investment philosophy. There is no warranty such companies have been or will be profitable. They must not be viewed as investment recommendations or research. Nothing in this document should be interpreted to imply that past results are an indication of future performance. This document should not be construed as the giving of advice or the making of a recommendation. It is not intended to be formal investment research in respect of any company. No reliance should be placed on the fact Generation invested in considering any future investment in such companies, the circumstances of which may have materially changed. This document is not calculated to lead directly or indirectly to any person entering into any investment management agreement or any exercise of any rights conferred by an investment to acquire, dispose of, underwrite or convert an investment so as to constitute an investment advertisement.
