Neuberger Berman, a private, independent, employee-owned investment manager, has held the final close of the NB Private Equity Impact Fund with nearly USD280 million of commitments.
The successful fundraise demonstrates the growth of Neuberger Berman’s private equity impact investment strategy and the manager’s active role in the market. Neuberger Berman manages USD429 billion in AUM with over USD96 billion of committed capital to private markets.
The Impact Fund primarily invests in direct and fund investments that seek to achieve positive social and environmental outcomes that are aligned with the UN Sustainable Development Goals and that also meet NB Private Equity’s traditional underwriting standards. The Fund invests in opportunities that are aligned with broader investment themes such as improving health outcomes, addressing climate change and energy needs, and improving sustainable growth and employment.
Dominique Drenckhahn, Principal at Neuberger Berman, says: “The Fund structure is designed to access best-in-class impact investments. The direct investments help increase overall capital efficiency and mitigate the J-curve. We seek to mitigate risk through diverse exposure to top-tier managers and companies. Additionally, we track and share the Fund’s impact metrics with our Limited Partners.”
As of 31 March, 2021, the Impact Fund has committed USD132 million to direct investments (co-investments), primary fund commitments and secondary transactions; each representing a compelling impact and investment thesis.
Investments include market-leading businesses that we believe have sound capital structures and that are generally focused on essential products and services that contribute to social and environmental solutions and therefore are less cyclical than the broader market. Examples include a point of use water filtration and dispenser company that is displacing plastic water bottles, a next generation broadband technology platform and an online tutoring solution that delivers both high-quality and affordable tutoring to K-12 students.
The Fund will be deployed by a global team of over 60 investment professionals. Additionally, c35 per cent of the Fund’s senior leadership team is comprised of women and underrepresented minority backgrounds, bringing a perspective uncommon in the industry.
Jennifer Signori, Managing Director at Neuberger Berman, says: “We believe that the Impact Fund’s focus on more essential products and services has enabled the portfolio to perform even during market turmoil. We benefit from the scale and strength of the Neuberger Berman Private Equity platform and invest selectively as we look to make a positive impact with our capital.”
ESG investing is core to Neuberger Berman and the firm builds upon this commitment with sustainable and impact investing solutions in partnership with clients. Neuberger Berman’s commitment to ESG investing is reflected in the firm’s A+ rating for 2018, 2019 and 2020 PRI Assessment Report on ESG Strategy & Governance as well as Private Equity (most recent assessment). The firm was named to the 2020 PRI Leaders Group, a designation awarded to fewer than 1 per cent of investment firms for excellence in Environmental, Social and Governance (ESG) practices).
The Impact Fund is backed by a global investor base that includes public and private pension plans, insurance companies and other financial institutions, endowments, foundations and family offices. Investors are represented across a broad geographic range including North America, Europe, Asia and Australia.
Maura Reilly Kennedy, Managing Director at Neuberger Berman, says: “We are honored to partner with world-class investors across geographies who share our vision that one can create real and lasting value by investing in companies that seek to provide solutions for the world’s most pressing needs.”