Former Vice President Al Gores Generation Investment Management Has Created A New $17 Billion Fund In A Move Aimed At Reducing Emissions Increasing Financial Inclusion And Making Healthcare More Accessible
Al Gore has not been quiet about the climate crisis. His 2006 film An Inconvenient Truth is often credited for sparking global climate action. Now, Gores $36 billion Generation Investment Management, which he co-founded in 2004 with David Blood of Goldman Sachs, is turning up the heat on climate-friendly investments.
The new $1.7 billion Sustainable Solutions Fund IV is Generations fourth and largest Growth Equity fund, and it will invest in companies shifting industries toward sustainability and responsible innovation at scale, the company said in a statement. The fund will allow Generation to invest $50-$150 million as active minority investors in high-growth companies with revenues between $30 million and $300 million.
Weve been researching the changes needed for a sustainable future, and investing in pioneering companies driving that transition for over 15 years, Lila Preston, Head of Growth Equity at Generation Investment Management, said in a statement. 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 dont, and add value where others cant.
The announcement comes in the midst of an energy crisis and rising inflation, underscoring the need for sustainable solutions.
Price Nutrition Sustainability And Taste
Preston says that Generation identified what she called tug of war between four factors: affordability , nutrition , sustainability , and taste.
We recognise that the traditional food system has had trade-offs. It has optimised taste and optimised price, but it hasnt optimised sustainability or necessarily nutrition, says Preston.
She argues that this trade-off has facilitated feeding people at a low cost. Technology and novel manufacturing approaches are bringing costs down even further. Were starting to see the first point in time where we may not require trade-offs between those four factors.
Preston explains that when addressing the trade-offs with management teams, Generation looks for ways to reconcile these factors.
For example, I always say, even some of the novel, organic farming has benefited from a sustainability perspective and perhaps have some benefits from lower chemical loads and perhaps nutrition, but its more costly: thats a trade-off, she explains.
Insect protein is really sustainable but may not hit the taste profile, she continues. So, every company that we look at undergoes this analysis. And thats why I get excited about companies like Natures Fynd because it has the possibility to address taste, with the nutritional profile, at low cost, at scale and hit the sustainability premise.
Sustainable Solutions Fund Iv
The new fund will focus on three key areas: planetary health, such as net-zero-carbon solutions transforming mobility, agriculture, energy, and enterprise by reducing waste and emissions, and enhancing biodiversity personal health, with a focus on better health outcomes and reducing costs while making healthcare more accessible and financial inclusion, by supporting access to finance, reducing inequality, and supporting an equitable future of work.
Sustainability has been and will always be at the core of our mission, but we know we cannot achieve this mission on our own, David Blood, Senior Partner of Generation Investment Management, said.
We believe partnership is the way to succeed. When companies and entrepreneurs work with Generation, they dont just get a single point of contact, Blood added. 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.
Generation says it offers its portfolio companies diversity of thinking and perspective through its range of experts and advisors and more than 150 deep research roadmaps outlining macro and long-term industry trends.
Don’t Miss: Best Way To Invest Online
Generation Launches $17 Billion Sustainable Solutions Fund Iv To Invest In Growth
Generations fourth and largest Growth Equity fund invests in teams delivering responsible innovation at scale and accelerating sustainable industry transitions
LONDON & SAN FRANCISCO, May 18, 2022—-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 firms commitment to invest globally in companies and teams driving the sustainable future.
Sustainable Solutions Fund IV is Generations 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 firms 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: “Weve 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 dont, and add value where others cant.”
Investment Focus
Differentiated Approach
The Case Of Natures Fynd
Generations portfolio brand Natures Fynd, the alternative protein company, is an example of a system-positive business because it addresses many of the systemic challenges of traditional food production.
The technology was developed by studying natures own solutions for adapting and thriving in environments with limited resources. The company based its work on research conducted by NASA on microbes in Yellowstone National Park.
Natures Fynd uses novel fermentation technology to grow a protein, called Fy , which is a highly nutritious source of animal-free protein with all nine essential amino acids, vitamins, minerals, and fibre.
A versatile protein, Fy is being developed as an ingredient for alternative meat, dairy and other food products. Natures Fynd is also developing products of its own.
Alongside Fys nutritional profile is the low carbon footprint of Natures Fynds production set up: it uses only a fraction of the land and water resources required by traditional agriculture: 99% less land and 97% less water than beef production.
Natures Fynds manufacturing process is highly automated, hence reducing the risk of many of the human health problems associated with the meat-packing industry.
Natures Fynd is currently in the process of market entry in North America.
You May Like: American Mortgage And Investment Company
Seventh Generation Receives Major Investment From Generation Investment Management
Investment Firm to Provide $30 Million in Capital for the Company’s Future Growth
Submitted bySeventh Generation
Today, Seventh Generation, the nation’s leading brand of non-toxic and renewable bio-based household, baby and personal care solutions, announces the addition of a new investor, Generation Investment Management.
The thirty million dollar investment will allow Seventh Generation and its own venture arm, Seventh Generation Ventures, to accelerate the company’s core growth through innovation, investment and acquisition of other mission-led brands. Seventh Generation Ventures acquired bobble in 2013 to expand its offerings and meet the growing needs of consumers who desire to live a healthy, environmentally-friendly lifestyle.
Founded in 2004, Generation Investment Management is dedicated to long-term investing, integrated sustainability research, and client alignment. The Climate Solutions team seeks to invest in growth businesses that it believes can generate attractive returns by being part of the transition to a low carbon economy.
“Businesses like Seventh Generation will continue to see strong growth driven by an authentic commitment to sustainability, value and product performance,” said Lila Preston, partner at Generation, who will also be joining the board. “We have built a relationship with the company over a period of years and have been deeply impressed by the quality of the management team and the company’s commitment to long term value creation.”
Writing The Roadmap For Sustainable Capital
Lila Preston, the Co-Head of Growth Equity Strategy at Generation Investment Management, began with an environmental awareness gained through a love of the outdoors, and is enabling sustainable growth companies to scale and succeed by investing equity capital and delivering deep expertise.
Your career has been centered around sustainability for some time now, going back to your time as a Fulbright Fellow in Chile working on forestry and conservation projects. What was that experience like and, stepping further back, how did your interest in sustainability start?
I grew up in a New York City apartment, and that environment led me to search for something more expansive. I was motivated to be outdoors whenever possible, and I spent all of my high school summers out West in Idaho and Wyoming, conducting wilderness studies and working on a ranch.
In high school during the mid1990s, I was inspired by the work of Doug Tompkins, the Founder of North Face. He was a deep ecologist working in the Patagonia region of Chile to preserve some of the most pristine temperate rainforests still undeveloped.
Generation is tackling the entire sustainability sector with investments in smart mobility, consumption, energy, food, and a half dozen more areas. With so many different subsectors under the general umbrella of sustainability, and Generations own limitations, how do you think about meaningfully allocating capital across all of them?
Who is your sustainable hero and why?
Also Check: How To Invest In Us Share Market
Progress Over Perfection Is The Goal For Sustainable Finance
Creating a low-carbon economy requires financial tactics currently being put to use across many industries, but participants at Fortunes Global Sustainability Forum on Thursday said the key to achieving this will be to focus on progress over perfection. The difficulty lies in making decisions for how to allocate capital when companies have imperfect information.
I wouldnt even call it a frustration, its a reality that we are moving forward, you know, based on imperfect data and imperfect information, said Val Smith, chief sustainability officer at Citi.
There was a study put out earlier this year, which showed looking back over the history about a decade of history of investing in climate tech, that 75% of the capital had only gone into solutions that address 25% of the emissions, said Nili Gilbert, vice chairwoman of Carbon Direct. You really need to flip that. I think one of the reasons that that is happening is because some of the emissions and solutions are hard to abate.
Gilbert pointed out that many of the emissions Carbon Direct deals with are last mile emissions things like tech for sustainable aviation fuel, green hydrogen, green cement, and carbon capture where some emissions that cant be abated have to be taken back out of the atmosphere. Some of this can be done on a small scale and some of the tech isnt yet scalable.
Tariq Nanji, partner at Boston Consulting Group, said the capital is available, but doesnt always get where it needs to go.
Al Gores Generation Investment Management Launches 13bn Fund
Former US Vice President Al Gores Generation Investment Management has launched a $1.7bn fund to invest in private sustainability companies.
Generations Fund IV is its largest fund to date and will see the firm invest between $50m to $150m in high growth businesses.
Specifically, it is investing in sustainable and environmental, social and governance companies. Founded in 2004, Generation Investment Management has over $36bn in assets under management.
Combined, Generations previous three funds have invested in excess of $2bn since 2008 into companies such as AlayaCare, Asana, Back Market, Benevity, Convoy, Gusto, Pivot Bio and Toast.
Weve been researching the changes needed for a sustainable future and investing in pioneering companies driving that transition for over 15 years, said Lila Preston, head of growth equity, Generation Investment Management.
Fund IV will continue Generations investment into planetary health, people health and financial inclusion.
Our systems-level view helps us identify industries, companies and entrepreneurs that can scale sustainable solutions globally, added Preston.
Potential investment companies are evaluated on their System Positive contribution by measuring the effects of a business model on people and the planet.
Generation has offices in London and San Francisco. It has previously invested in the UKs Octopus Energy, a clean energy supplier, and Ocado Group, an online grocery company.
Also Check: Charles Schwab Investment Management Reviews
