Risk Management & Analytics
Can investors pursue measurable social, environmental, or economic outcomes without compromising private markets discipline?
In this research, Adams Street examines its experience investing across impact-oriented opportunities in private markets, drawing on its long-standing investment platform, proprietary data, and Impact Investing Framework. The paper analyzes Adams Street’s “Impact Qualifying Investments”1 across co-investments, venture growth, and primary fund strategies, with a particular focus on how impact-oriented primary fund commitments compare with the firm’s broader primary investment portfolio across vintage years.
The research explores Adams Street’s broad thematic approach to impact investing, which is organized around four Core Impact Themes: Health and Wellness, Economic Development, Education and Enrichment, and Sustainability. It also discusses how a broad impact lens may support diversified portfolio construction across sectors, managers, geographies, and fund sizes.
For investors evaluating the role of impact within a private markets program, the research offers a practitioner perspective on market development, portfolio design, and the ways experienced allocators can integrate mission-aligned objectives into a disciplined investment process. The findings support Adams Street’s view that impact investing can be pursued on a non-concessionary basis when investors apply rigorous underwriting, consistent return expectations, and established manager selection capabilities.
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1. “Impact Qualifying Investments” are investments made in any of Adams Street’s Co-Investment, Venture Growth, or Primary strategy vehicles beginning in 2010 and which align with one of Adams Street’s four Core Impact Themes of Health and Wellness, Economic Development, Education and Enrichment, and Sustainability, and were underwritten with a return profile that aligns with Adams Street’s Impact Investment Strategy target. The determination of what constitutes an “Impact Qualifying Investment” is solely an Adams Street determination, made in its discretion, and is a backward-looking assessment as investments generally did not historically carry such classification at the time they were made/held and is a product of Adams Street’s more recent development of a dedicated Impact Investing Framework and creation of the Impact Investment Committee. Although there may have been investments prior to 2010 which would have aligned with one of Adams Street’s four Core Impact Investment Themes, Adams Street has chosen to use 2010 as its first year for purposes of a look-back as this is also the year that Adams Street became a signatory to the UN PRI. Adams Street does not expect to invest in Cleantech or Life Sciences on a go-forward basis and therefore has excluded investments from these sectors when identifying Impact Qualifying Investments. Additional information on Adams Street’s investments in Cleantech and Life Sciences is available upon request. Although Adams Street has made historical investments in Private Credit, including some which have had an impact focus, any such investments were not underwritten based on return targets that would have qualified it for inclusion as an Impact Qualifying Investment. To date, Adams Street has not participated in any Secondary investment of an impact-focused fund.
Important Considerations: This information (the “Paper”) is provided for educational purposes only and is not investment advice or an offer or sale of any security or investment product or investment advice. Offerings are made only pursuant to a private offering memorandum containing important information. Statements in this Paper are made as of the date of this Paper unless stated otherwise, and there is no implication that the information contained herein is correct as of any time subsequent to such date. All information has been obtained from sources believed to be reliable and current, but accuracy cannot be guaranteed. References herein to specific sectors, general partners, companies, or investments are not to be considered a recommendation or solicitation for any such sector, general partner, company, or investment. This Paper is not intended to be relied upon as investment advice as the investment situation of individuals is highly dependent on circumstances, which necessarily differ and are subject to change. The contents herein are not to be construed as legal, business, or tax advice, and individuals should consult their own attorney, business advisor, and tax advisor as to legal, business, and tax advice. Past performance is not a guarantee of future results and there can be no guarantee against a loss, including a complete loss, of capital. Certain information contained herein constitutes “forward-looking statements” that may be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “intend,” “continue,” or “believe” or the negatives thereof or other variations thereon or comparable terminology. Any forward-looking statements included herein are based on Adams Street’s current opinions, assumptions, expectations, beliefs, intentions, estimates or strategies regarding future events, are subject to risks and uncertainties, and are provided for informational purposes only. Actual and future results and trends could differ materially, positively or negatively, from those described or contemplated in such forward-looking statements. Moreover, actual events are difficult to project and often depend upon factors that are beyond the control of Adams Street. No forward-looking statements contained herein constitute a guarantee, promise, projection, forecast or prediction of, or representation as to, the future and actual events may differ materially. Adams Street neither (i) assumes responsibility for the accuracy or completeness of any forward-looking statements, nor (ii) undertakes any obligation to update or revise any forward-looking statements for any reason after the date hereof. Also, general economic factors, which are not predictable, can have a material impact on the reliability of projections or forward-looking statements. Adams Street Partners, LLC is a US investment adviser governed by applicable US laws, which differ from laws in other jurisdictions.
