A growth investor that uses a proprietary ‘robot’ artificial intelligence-driven software platform to source deals has started adding an impact lens to its investments.
Jolt Capital, a Paris-headquartered firm, announced the final close of its fourth fund yesterday at €271 million. The vehicle is investing growth capital in B2B technology companies that support positive social or environmental impact, said Laurent Samama, a managing partner and compliance officer at Jolt.
Jolt was established in 2012 with backing from Temasek subsidiary Vertex Ventures among other investors. It has developed a proprietary AI-driven software platform called Jolt Ninja, as reported by affiliate Private Funds CFO, to help the firm find innovative technology companies seeking growth capital. Ninja greatly increases the volume of opportunities that land on the investment team’s desks – which means Jolt’s investment team can select the best opportunities in the market for positive impact by human evaluation processes.
“Ninja helps us identify the companies with significant intellectual property – for example, through patents and publications,” Samama told New Private Markets. “[Then] we need to work and start analysing which of these Ninja identified companies do really have a positive impact. We will know this only by meeting with the company and seeing them in action.
“Ninja does a lot upstream to get us a dealflow of potentially impactful companies. We then need to focus our work on the really impactful ones,” he said.
“Our focus is on technologies that really have a positive impact on the way things work – technologies that bring real innovation, make things positively different. Where there is innovation and technology, there is a potential for disrupting existing processes, such as in industry, services, transportation, computing, energy production – and making them more efficient as well as more careful of people and environment.”
But Fund IV will not be classified under Article 9 of the SFDR because “Article 9 demands for some specific impact – social impact or climate impact”, said Samama. “We look for broader impact which cannot necessarily be measured. But there is social impact [in our investments].”
Jolt will report on 20 KPIs for social and environmental impact of the fund’s portfolio, including the carbon footprint, waste management, energy efficiency of portfolio companies. Social impact KPIs include job creation, staff training, senior management and board parity, and Jolt is working on a framework to measure positive social impact creation, said Samama.
Investors were attracted by the fund’s impact considerations, but Jolt did not see great demand among LPs for Article 9 compliance because the complete taxonomy of the SFDR is still under development, Samama said. However, Jolt’s fifth fund will be Article 9 compliant, he added.