KKR impact fund’s Burning Glass deal highlights workforce development theme

As highlighted by its acquisition of Burning Glass Technologies, KKR’s global impact team sees opportunities in companies tackling workforce development and educational innovation, Robert Antablin, co-head of KKR Global Impact, told Buyouts.

KKR’s impact-focused arm is focused on businesses that help individuals better prepare for the workforce at a time when employees increasingly require different skills and capabilities, Antablin said.

KKR’s acquisition of Burning Glass Technologies follows that theme.

The Boston-based software analytics company delivers real-time data on labor market to institutions and private companies. KKR bought the company from Providence Strategic Growth.

The pace of technological change is redefining the nature of jobs and the underlying skills these jobs require, according to Antablin. Those changes are exposing inefficiencies in the labor market, most notably a mismatch between supply and demand.

Burning Glass helps to narrow this gap through real time data collection and analysis that enables employers, educational institutions and governments, to make labor market-informed decisions, he said.

“The company assesses market demand by gathering the data associated with job posting across America and it does it in real time. Then, it takes this information and it analyzes it, and organizes it, and frames it for institutions that it serves,” Antablin told Buyouts.

The focus of the company is advising these institutions on how to modify their programs to match the labor market need and demand, Antablin said.

For instance, if a city is in high demand of certain workers, the city’s local university may learn this from Burning Glass. The university can later use this data to create a curriculum that prepares students for those local openings, he explained.

This role of the company reflects two out of 17 United Nations’ sustainable development goals (SDGs) – Quality Education, and Decent Work and Economic Growth.

KKR Global Impact fund, which raised more than $1 billion in commitments, has not have an official close yet, sources familiar with the firm said. The fund is still raising capital, they said.

The firm wants to make investments in lower middle-market companies tackling sustainable waste management, energy efficiency and water.

The fund’s previous investments include Barghest Building Performance, a Singapore-based provider of energy savings solutions; Ramky Enviro Engineers Limited, provider of environmental services and solutions in India; and KnowBe4, provider of security awareness training and simulated phishing platform.

The firm is also looking to grow its portfolio companies internationally by leveraging KKR’s global footprint, Antablin said.

“The first business we invested in, Barghest Building Performance, is based in southeast Asia. It is looking to expand in northeast Asia, and we are helping them with this expansion,” he said.

KKR Global Impact, the first impact strategy of KKR & Co, is competing in the space with TPG’s Rise Fund, which closed on $2 billion in 2017, and Bain Capital’s Double Impact Fund, which closed on $390 million same year.

Both firms are said to be raising their second impact funds. TPG is targeting $2.5 billion with its Rise Fund II, according to Bloomberg.

Action Item: Check out KKR Global Impact’s portfolio.