Finding Opportunity Amidst Uncertainty
The world is awash with uncertainty and dare I say a bit of emotional whiplash. There’s a blanket of caution across markets as investors seek clarity in their search for solid ground. While the underlying fundamentals of many companies remain strong, policy overhang and investor hesitancy have left many in a wait-and-see mode. The promise of 2025 as a turning point for exit liquidity in the private markets is fading.
Uncertainty breeds volatility and creates risk, but also opportunity. We take solace in knowing that our Uplifting Capital Private Impact Fund (PIF I) is well-positioned to capitalize on this opportunity.
LPs looking for liquidity? GPs needing a little more runway? Through our investment in an impact secondaries fund, PIF I is rapidly deploying capital in climate and health, purchasing existing LP fund interests at meaningful discounts and providing fresh capital to GPs on preferred terms for select assets that will benefit from 2-3 additional years to position for exit.
Start-ups seeking financing? In a reset venture capital landscape largely characterized by rational valuations, reduced cash burn rates, and an orientation towards profitability, as of year-end PIF I’s venture funds had half of their capital available to be deployed in this more favorable environment.
Sectors benefiting from the technological revolution that’s underway despite the broader noise in the market? PIF I’s underlying managers are expanding power capacity and energy storage to meet surging demand from AI workloads and the electrification of the economy. They are also capitalizing on the AI opportunity by investing in education and health-specific application areas for large language models.
Everything we do is first and foremost grounded in a compelling economic proposition. While our fundamental investment thesis centers on pinpointing where intentionality around the identification and measurement of positive impact on the planet, its people, and our economy serves as the catalyst for value creation, our targeted impact opportunities manifest as large addressable markets with significant supply/demand imbalances that are well-suited to benefit from innovation. With history as our guide, we believe the market dislocation we are experiencing now will once again prove the resilience of the private markets. Investors with the capital and the courage to lean into similar market conditions in the past have been rewarded for doing so.
PIF I was 98% committed and 47% deployed as of year-end 2024. The Fund is performing in line with expectations, with early returns generated from private equity and real assets, while venture is experiencing deeper and more protracted j-curves. Net of fees, overall PIF I performance exceeded its traditional private equity benchmark in terms of internal rate of return (IRR), total value to paid-in capital (TVPI), and distributions to paid-in capital (DPI), all while making material positive impact on people and the planet. With our Impact Alpha strategy, returns are driven by impact (colinear); not just coexistent with it.
While still early days, we are pleased with PIF I’s solid start and look forward to sharing more highlights in the coming quarters.
Authored by Linda Assante – Managing Partner and Chief Investment Officer, Uplifting Capital
Past Performance is not indicative of future results. There is a risk of loss. The risks described herein do not constitute an exhaustive list of risks associated with an investment in the Fund. For more disclosure and disclaimer information, please visit this page.
