TPG Rise Climate, the climate investing strategy of global impact investing platform TPG Rise, has marked the first close of its inaugural fund at $5.4 billion (Rs 40,199 crore).
The fund has set a hard cap of $7 billion in total capital commitments and expects to hold a final close in the fourth quarter of 2021, the firm said on Tuesday.
“It’s a time of both peril and possibility. Climate change is a societal risk but also a generational investment opportunity,” said TPG founding partner and executive chairman Jim Coulter, who is also managing partner of TPG Rise Climate.
“Leveraging our deep experience in impact investing, we believe TPG Rise Climate can play a positive role in catalysing capital to combat climate change,” Coulter said.
With today’s announcement, TPG now manages over $11 billion of assets across TPG Rise.
TPG Rise Climate, which was set up in early 2021, raised capital from institutional investors and over 20 companies for the climate fund and will invest in entrepreneurs and businesses building climate solutions around the world, it said.
TPG Rise Climate’s first close received subscriptions from institutional investors including Allstate, AXA, The Hartford, Ontario Teachers' Pension Plan Board, Public Investment Fund, Public Sector Pension Investment Board, School Employees Retirement System of Ohio, Silk Road Fund, State of Michigan Retirement System, Universities Superannuation Scheme (USS), and Washington State Investment Board, the firm’s media statement said.
TPG Rise Climate’s investor base also includes multinational companies that will form the core of TPG Rise Coalition which will formalise collaboration and share insights to accelerate knowledge exchange, investment opportunities, and best practices among the group and the broader TPG Rise Climate ecosystem, the firm said.
The Rise Climate Coalition comprises of more than 20 founding companies and members including 3M, ADM, Allianz, Allstate, Alphabet, Apple, AXA, Bank of America, Boeing, Dow, Exor, FedEx, GE, General Motors, Honeywell, John Deere, Michael R. Bloomberg, NIKE, Sumitomo Mitsui Banking Corporation, Smithfield Foods, and TD Bank Group.
The fund said it will seek to work collaboratively with companies, entrepreneurs, and scientists who have pioneered and developed innovative climate solutions over the past decade.
It will take a broad sector approach, ranging from growth equity to value-added infrastructure, and focus on five climate sub-sectors: clean energy, enabling solutions, decarbonized transport, greening industrials, and agriculture and natural solutions, it added.
The fund will focus on economic returns and rigorous impact assessment through Y Analytics, a public benefit LLC dedicated to understanding, valuing, and managing the social and environmental impact of an investment, the statement said.
TPG Rise Climate is also constructing its portfolio of companies to enable carbon aversion in a quantifiable way. TPG Rise Climate will utilise Y Analytics’ methodologies including Carbon Yield – a decision tool that leverages scientific, health, economic, and social science research – to estimate the tonnes of carbon dioxide equivalent emissions avoided per dollar invested, the firm said.
Multiple firms have set up climate platforms in recent years. In 2020, BlackRock-backed group said it aims to raise an initial $500 million for a private equity fund that will invest in climate change-linked infrastructure upgrades in emerging markets. Earlier in July, https://www.vccircle.com/ikea-foundation-rockefeller-foundation-partner-to-form-1-bn-global-climate-change-platform/ IKEA and Rockefeller set up a $1 billion global climate change platform.
The Green Growth Equity Fund is a climate fund anchored by the governments of India and the UK and managed by EverSource Capital, a 50:50 joint venture between Everstone Capital and European solar energy developer Lightsource BP.