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TPG’s Rise Fund raises $2 bln for impact investing with measurable outcomes

  • Led by TPG Growth’s Bill McGlashan, Jeff Skoll and Bono
  • TPG employees to add more capital before final close
  • Partners Bridgespan Group and KPMG to track social outcomes

TPG’s impact-investing arm, Rise Fund, hit its hard cap of $2 billion, a person familiar with the situation confirmed. The news was first reported by Bloomberg.

Led by Bill McGlashan, a managing partner at TPG Growth, Rise was targeting $1.5 billion. More capital is expected to come from employees of the firm before the fund closes.

McGlashan is joined on the board of Rise by TPG co-founders David Bonderman and Jim Coulter, as well as a bevy of high-profile investors. Getting top billing are Jeffrey Skoll, eBay’s first president and now a film producer through Participant Media, and Bono, the U2 frontman and conspicuous philanthropist. Also on the board are Pierre Omidyar, Richard Branson, Reid Hoffman, Mellody Hobson, Paul Polman, Mo Ibrahim, Laurene Powell Jobs and Lynne Benioff.

McGlashan and Bono have been outspoken about the need for accountability in impact investing. The rock star told The New York Times last year that “do-gooders” are afforded a certain “lazy mindedness,” resulting in “a lot of bad deals done by good people.”

“Capitalism is going up on trial,” Bono added, “and I think it’s clear that putting profit before people is a nonsustainable business model.”

McGlashan told Bloomberg that TPG will be open about its impact-investing process, to offer a model for the industry. Nonprofit consultancy Bridgespan Group will assist in measuring the social or environmental value provided by Rise’s investments, with accounting firm KPMG providing assurance.

Rise is targeting seven sectors: agriculture and food, education, energy, financial services, healthcare, technology, and infrastructure. Investments include South India’s Dodla Dairy, digital learning subscription service EverFi, and automated appliance maker Brava Home. The fund is in part a collaboration between TPG Growth and Elevar Equity, a venture capital firm focused on underserved consumers in India and Latin America.

Action Item: Read more about Rise Fund’s impact-assessment methodology here.

David Bonderman, founding partner at TPG, takes part in the Private Equity: Rebalancing Risk session during the 2014 Milken Institute Global Conference in Beverly Hills, California, on April 29, 2014.  Photo courtesy Reuters/Kevork Djansezian