KKR has closed its second Global Impact fund on $2.8 billion.
The firm spent more than two years on the road, having registered the fund in June 2021. KKR committed $250 million to the vehcile, the fund close announcement states, while Washington State Investment Board committed $150 million, New Private Markets‘ database shows.
The final close, announced this morning, puts KKR Global Impact II among the largest generalist impact funds to date. Elsewhere, EQT’s Future fund had collected €2.7 billion in “fee-generating commitments” in April, while Summa Equity’s Fund III closed on €2.3 billion last year. TPG’s Rise Fund III, which has a $3 billion target, had raised $2.15 billion as of March 2023.
Global Impact II is a generalist growth and buyout strategy straddling social and environmental impact along four themes: climate action, sustainable living, lifelong learning, and inclusive growth. It has a six-year investment period between June 2022 and June 2028, according to the firm’s second-quarter results in August 2023.
KKR launched its impact strategy in 2018, making it one of the first major buyout shops to expand into impact. Global Impact I closed in 2020 on $1.3 billion, with New York State Common Retirement Fund among its LPs. Around $1.2 billion of the first fund had been invested and $332 million had been realised as of August, according to KKR’s Q2 results statement.
KKR has a 22-person team working on its impact strategy. It is led by global co-heads of impact Rob Antablin and Ken Mehlman. The team pursues “resilient investments with intrinsic and apolitical tailwinds” and focuses on “the commercial success of impactful companies”, Mehlman wrote in NPM in September. “Our approach is to invest in companies with proven business models that achieve impact through their core products and services.
“The energy transition is now a global imperative, driven in part by geopolitical events like Russia’s attack on Ukraine, along with environmental and economic considerations – and there is unprecedented policy support and corporate commitment driving it… Similarly, our focus on workforce development and lifelong learning is accelerated by concerns about too few skilled workers available for the jobs in demand.”