TPG Raises $5.4 Billion for Climate-Focused Inaugural Fund

TPG Rise Climate, the climate investing strategy of TPG’s (formerly Texas Pacific Group) global impact investing platform TPG Rise, has raised $5.4 billion from over 20 companies and global institutional investors for its inaugural fund.

TPG Rise Climate will utilize the proceeds of the fund for the initiatives in five key areas: clean energy, enabling solutions, decarbonized transport, greening industrials, and agriculture and natural solutions.

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, and Washington State Investment Board were some of the largest institutional investors that invested in TPG Rise Climate.

Together with other limited partners subscribing to the fund, this group manages more than $3 trillion of assets globally.

TPG Rise Climate has capped the capital commitments at $7 billion and expects to hold a final close in the fourth quarter of 2021.

Launched in early 2021, TPG Rise Climate forms an integral part of the growth and evolution of TPG’s global impact investing platform. The TPG Rise platform focuses on innovation, specialized capital, and strategy diversification. With the latest funding, TPG now has over $11 billion of assets across TPG Rise. The move places the firm as one of the largest global private markets impact investing platforms and a key entity of TPG’s growth strategy.

The fund takes a growth equity approach as it collaborates with companies, entrepreneurs, and scientists pioneering climate solutions in the last ten years.

“Leveraging our deep experience in impact investing, we believe TPG Rise Climate can play a positive role in catalyzing capital to combat climate change. The partnership of leading investment institutions and major corporations funding TPG Rise Climate signals a growing business community committed to engaging in this existential issue,” said TPG Founding Partner and Executive Chairman Jim, who is the Managing Partner of TPG Rise Climate.

The fund is set apart from traditional private equity vehicles as its investor base includes many of the world’s leading multinational companies. To formalize collaboration and share insights among this group, TPG is forming the TPG Rise Climate Coalition. The Rise Climate Coalition will comprise more than 20 founding companies and members who have done extensive work building sustainability and climate action into their businesses, including Nike, Apple, Alphabet, 3M, Bank of America, Boeing, FedEx, GE, Sumitomo Mitsui Banking Corporation, Smithfield Foods, among others. The group will regularly convene to exchange knowledge, investment opportunities, and best practices.

“The Rise Climate Coalition brings together leading global businesses in a shared commitment to harness the rigor of TPG’s investment process to unlock technologies, scale solutions, and deliver broad impact. Together, we can catalyze climate-focused capital to accelerate and scale climate solutions of tomorrow,” said Hank Paulson, Executive Chairman of TPG Rise Climate Paulson.

As part of the effort, TPG will conduct rigorous impact assessment through Y Analytics, a public benefit LLC dedicated to understanding, valuing, and managing an investment’s social and environmental impact. TPG Rise Climate will use Y Analytics methodologies like Carbon Yield — a decision tool powered by scientific, health, economic, and social science research — to estimate how much carbon dioxide-equivalent emissions are avoided by each dollar invested.

Earlier this year, The Rise Fund had invested  $25 million in distributed solar company Fourth Partner Energy’s equity funding. Rise fund had earlier infused $70 million in the company in July 2018.