Invests in firms addressing UN’s SDGs

Private Equity firm KKR has announced the final closing of its $1.3 billion Global Impact Fund. Originally launched in 2018, the fund aims to invest in companies with business models that provide commercial solutions to environmental or social challenges.

Private equity firms have been actively growing their ESG-oriented portfolios. In addition to KKR’s Global Impact Fund, Blackstone announced it was launching a new impact investing platform in May 2019, and TPG is currently seeking to raise $2.5 billion for its impact investing fund, Rise Fund II (although TPG’s efforts were set back by the unexpected exit of co-founder Bill McGlashan, following his alleged involvement in last year’s high profile college admissions scandal).

Headed by KKR partners Ken Mehlman and Robert Antablin, KKR Global Impact has a dedicated 12-person team, spread across the Americas, Europe and Asia. The fund aims to generate private equity risk-adjusted returns, and invest in lower-middle market companies. KKR is targeting companies that contribute progress towards one or more of the United Nations Sustainable Development Goals (“SDGs”).

According to Antablin and Mehlman, “The UN SDGS were developed to mobilize citizens, policymakers, technologists and investors to address global challenges. As investors, we have a significant role to play in building businesses that contribute to SDG solutions while also generating financial returns for our fund investors by doing so.”

KKR has identified ESG-based macro themes that it will target with through the Global Impact Fund:

  • Mitigating and adapting to climate change
  • Protecting clean water
  • Learning and workforce development
  • Responsible waste management
  • Leveraging technology to enhance safety, mobility and sustainability
  • Serving globally conscious consumers healthier and more sustainable products and services
  • Upgrading declining industry and infrastructure

According to KKR, the fund raised capital from a broad set of existing and new investors, including public pensions, family offices, high net worth individual investors and institutional investors. KKR will be co-investing $130 million in the fund through the firm’s balance sheet as well as employee commitments.

Since its 2018 launch the fund has already made a number of investments, including:

  • Barghest Building Performance (BBP) – based in Singapore, BBP provides energy savings solutions to Heating, Ventilation and Air Conditioning systems in commercial and industrial buildings.
  • Burning Glass Technologies – Based in Boston, Burning Glass is a provider of labor market analytics software that delivers real-time data and planning tools to educators, employers and public sector constituents.
  • KnowBe4 – Florida-based KnowBe4 is a market-leading software platform for cybersecurity awareness training.
  • Ramky Enviro Engineers – Based in India, Ramky is a provider of environment management services.