Impact Investing
Impact Investing

Impact Investing

 
 
 
Summary

Provides access to a diversified portfolio of private equity investments that seek to achieve compelling financial returns together with a demonstrable and measurable positive social and economic impact.

 
 
Investment Approach
Philosophy

We believe that impact investing looks to go a step further than socially responsible investing in that investments are made in companies where, at the time of investment, there is a reasonable expectation that such investment may create positive social impacts such as increased jobs and access to quality of life improvements—e.g., education, health care, housing and finance, or positive environmental impacts.

While we do not think there is a necessary trade-off between commercial return and impact, we do think there are trade-offs between spaces within the impact spectrum. Generally, we believe that more-scalable opportunities can create greater impact than less-scalable opportunities, and that a broader portfolio-based approach to impact may allow greater scalability than a narrowly focused and highly specific approach.

 

 
Differentiators
Experienced, Purpose-built Team

The team’s investment professionals have extensive experience and skill in sourcing, analyzing, and investing in impact-oriented private equity opportunities.

Firmwide Commitment to Sustainable Investing

Anchored by significant investing and advisory experience in inclusive finance and affordable housing, community development and clean energy.

Multi-dimensional Impact Reporting Framework

Comprised of measurable impact indicators, short stories of impact and impact case studies.

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Investment Process
1
Source Opportunities

Bottom-up search for what we believe to be the best talent with emphasis on impact-generating opportunities. 

2
Analyze Opportunities

Evaluate funds through rigorous quantitative, qualitative due diligence. 

3
Apply Impact Parameters

Analyze opportunity set in context of impact parameters. 

4
Invest and Monitor

Investment Committee members approve each investment. 

5
Ongoing Monitoring and Reporting

Post-investment validation of investment thesis and continued monitoring of portfolio.

 
 
Portfolio Managers
Head of the AIP Private Markets Team
29 years industry experience
Managing Director
28 years industry experience
Executive Director
20 years industry experience
 
 
 
 

Alternative investments are speculative and include a high degree of risk. Investors could lose all or a substantial amount of their investment. Alternative investments are suitable only for long-term investors willing to forego liquidity and put capital at risk for an indefinite period of time. Alternative investments are typically highly illiquid – there is no secondary market for private funds, and there may be restrictions on redemptions or assigning or otherwise transferring investments into private funds. Alternative investment funds often engage in leverage and other speculative practices that may increase volatility and risk of loss. Alternative investments typically have higher fees and expenses than other investment vehicles, and such fees and expenses will lower returns achieved by investors.

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Impact Investing will target strategies and markets that demonstrate the potential to produce superior returns due to market inefficiencies and/or companies with a strong potential for change, as well as measurable positive social or environmental impact through investing in activities that result in (among other things) the creation of jobs for underserved populations, climate change mitigation or the provision of basic services (such as access to finance, energy, education, healthcare, water, sanitation or transportation) to those who currently do not have access, or cannot afford such access. Social and environmental impact investments may not provide as favorable returns or protection of capital as other investments.  Certain investments using non-standard terms that are less favorable than those traditionally found in the marketplace for investment strategies that do not link social or environmental impact to financial returns.  Moreover, the team may determine to forgo an investment that could provide favorable returns because such investment would not have sufficient social or environmental impact. Certain investments may focus on geographic areas that are experiencing weakened financial positions (including high unemployment rates, disease, high poverty rates, high foreclosure rates, and low incomes) that may be more susceptible to negative effects of changes in the economy or the availability of public assistance.

Team members may change from time to time.

No investment should be made without proper consideration of the risks and advice from your tax, accounting, legal or other advisors as you deem appropriate.

The statements above reflect the opinions and views of Morgan Stanley AIP as of the date hereof and not as of any future date and will not be updated or supplemented. All forecasts are speculative, subject to change at any time and may not come to pass due to economic and market conditions.

Past performance is not indicative of future results. Diversification does not eliminate the risk of loss. Morgan Stanley and its affiliates do not, directly or indirectly, guarantee, assume or otherwise insure the obligations or performance of any fund or any covered fund in which such fund invests.

 

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