The joy that North Sky Capital’s investment team gets from completing a deal that will have a positive impact on the world sometimes feels too good to be true.
Scott Barrington, chief executive of the Minnesota-based manager, said he has to “pinch himself” because of how much he and his team “really like what we do,” he told New Private Markets. “It’s a heck of a lot of fun,” he said. “It is very rewarding because everything we do is making the world a better place to live in.”
North Sky was founded in 2000 and invests for impact across the private markets landscape. With tech innovation as a guiding theme, the firm backs companies directly, takes stakes in private equity funds and finances infrastructure projects.
At nearly two decades old, North Sky is part of the original guard for GPs dedicated to mission-focused investing. As a sign of the firm’s history in the market, Barrington described an early deal in which North Sky focused on funding companies that were developing a better option for the standard light bulb. The firm became an early mover in the energy efficiency space with its investment in LED lighting.
“Watching people attack that problem through science and engineering skills was fun […] we were glad to be part of that transition,” he explained.
The firm’s focus has also evolved with the times, with a more recent investment going into a company converting a wastewater treatment plant in Los Angeles into a facility that can convert methane into renewable natural gas.
“Every day there’s a new opportunity here and a way to use investment capital to improve people and the planet,” Barrington said.
At $627 million, North Sky finished 15th in the inaugural Impact 20 ranking New Private Markets published in June. The ranking catalogues the industry’s top impact fundraisers that held final or official interim closes between January 2016 and March 2021. The Impact 20 uses the GIIN’s definition of impact which covers investments that are made “with the intention to generate positive, measurable social and environmental impact alongside a financial return.”
Our conversation with Barrington is the first in a series of profiles about the GPs listed in the Impact 20 ranking. A portion of that conversation is highlighted in the video above and features Barrington explaining how the North Sky team stays motivated in an “ever-changing” market of innovation.
This article has been updated to include additional comments from Barrington about North Sky’s approach to impact investing.