Generation's Sustainable Fund reaches $1bn close

The fund has a growth equity strategy, and enables the firm to make minority investments of $50-150m in innovative companies with high-growth potential.

It specialises in growth-stage business with well-established technology and focuses on investments in the areas of planetary health, people health, and financial inclusion.

The firm's growth equity strategy historically focused on planetary health companies. However, the team now looks at how issues are interconnected in the areas of planetary health, people's health and financial inclusion, a source told Unquote.

Generation IM has a growth equity team of 14 people.

The firm's previous fund was Generation IM Climate Solutions Fund II, a venture fund with a $750m target.

Investors
Global wealth manager UBS has committed $93m to Sustainable Solutions Fund III.

Generation Investment Management has not disclosed any of the LPs in the fund, though a source told Unquote that the firm prides itself on building long-term relationships with LPs across its investment strategies.

Among the LPs that have committed to Generation IM Climate Solutions Fund II include Environment Agency Pension Fund (EAPF) and Third Swedish National Pension Scheme (AP3).

Investments
Generation IM Sustainable Solutions Fund III has made two investments so far: it backed a $77m funding round for Swiss healthcare technology company Sophia Genetics; and a $100m series-D for engineering business Andela.

Other companies that represent growth equity opportunities for Generation IM include firms that provide customers with superior products and services, dedicated to promoting fully sustainable business models. Some of the representative companies are Asana, DocuSign, Gogoro, CiBO, M-Kopa, Ocado, Optoro and Seventh Generation.

The firm is analysing potential portfolio companies, looking at the company's culture and governance, alongside a focus on growth trends, margins and competitive positioning, according to the source. The source added that the investment decisions are guided less by geography and more by what the business represents in terms of goods and services, and how it operates.

People
Generation Investment Management – David Blood (co-founder).

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