Resources created and curated to support the growth of impact investing, for those new to the field and for experienced practitioners.
An Annual Showcase of Impact Investment Fund Managers
Founded in 2008, Arborview Capital is an impact-focused investment firm that makes growth equity and venture capital investments in high growth, mission-oriented companies. For the past two decades, our partners have been teaming with exceptional management teams to build best-of-breed businesses in high growth industries. We've built a reputation as partners and trusted advisors to management teams looking for strategic, impact-focused growth capital that creates positive systemic change and top-tier returns to all stakeholders.
Arborview's investment thesis is based on the fundamental belief that growth equity capital provides the best risk-adjusted returns for investors seeking to invest in three core sectors (energy efficiency, resource efficiency, and sustainability) where success can be measured not only by the investment returns but also by the positive social and environment impacts shared by a company's stakeholders.
Arborview's investment thesis has three essential elements; first, seek out businesses where demand for cleaner or more sustainable alternatives provides an opportunity for strong growth. Second, acquire a meaningful stake in the business at a reasonable valuation and work closely with management to build infrastructure and processes to support scalability and rapid growth. Third, partner with management to execute on business growth and position the company as an attractive enterprise that can create significant value for all stakeholders. Our knowledge of the broader industry trends in our core sectors – energy efficiency, resource efficiency and sustainability – is critical to ensuring the proper positioning and market strategy as well as the most likely long-term path towards success for each business.
We believe Arborview Capital is differentiated in the following ways: Growth equity mandate provides flexibility to pursue either minority or majority ownership stakes Typical hold period is longer than average due to our focus on MOIC (over IRR) Focused, lower velocity investment strategy - fewer companies results in a higher level of Arborview engagement with management Impact community engagement - founding member (and steering committee) of Impact Capital Managers, Wharton Social Impact Initiative, MIINT host, etc. Funds are GIIRS and iPar rated and our portfolio companies are GIIRS rated Strong investment returns - both MOIC and realized/DPI
Arborview's first investment was a $5.25 million equity investment in LRI Energy Solutions. Founded in 1992, LRI provides fully outsourced lighting and water efficiency solutions to the energy service company ("ESCO") industry and has managed over 500 projects including: the US Capitol, the Supreme Court, the National Park Service, etc. Since Arborview's investment, LRI revenues increased from $7 million in 2008 to over $50 million today with strong EBITDA growth each year. The Company's solutions reduce lighting and water usage by 10-30% and to date have saved over 3.9 billion gallons of water and 65 million kWatt hours of energy. The Company has tripled its workforce from 25 to 75 employees and implemented both profit sharing and an incentive option pool to encourage employee ownership. Arborview partially realized its investment in September 2016 resulting in a gross return of 6.1x invested capital and a 34% IRR with significant upside from an ongoing 8% ownership position.
Karl Khoury – Co-founder and Partner More Info
Karl is a founder of Arborview Capital, co-heads the investment team and co-manages the operations of the firm. Prior to co-founding Arborview Capital, he had twelve years of experience identifying, consummating and managing private equity investments with Columbia Capital, a sector-focused venture capital firm with over $2 billion under management. During that time, he invested in 13 companies with a primary focus on enterprise and communications software, security, and managed IT services. Prior to Columbia Capital, Karl worked at J.P. Morgan & Co. in New York and San Francisco where he specialized in corporate finance and capital markets for technology and communications clients.
Joe Lipscomb – Co-founder and Partner More Info
Joe is a founder of Arborview Capital, co-heads the investment team and co-manages the operations of the firm. Prior to co-founding Arborview Capital, he had nine years experience identifying, consummating and managing private equity investments, first as a managing director at The Carlyle Group and then with the Global Environment Fund. He has a long track record of working closely with high quality management teams to build successful, leading companies in high growth sectors. Prior to that, Joe had a nine year career at BT Alex Brown and First Boston, providing financing and advisory services to growth companies.
Brian Lee – Partner More Info
Brian has been a private equity investor for more than 20 years and works closely with many of Arborview Capital’s portfolio companies including Rachio and LRI Energy Solutions. Prior to Arborview, Brian worked at The Carlyle Group in their Aerospace, Defense & Government Services group and before that at First Reserve, the largest global private equity firm focused on energy. Brian began his career at BT Alex Brown and then Morgan Stanley where he structured and executed leveraged buyouts, mergers and acquisitions, IPOs and other transactions for private equity clients.
Percentage of Total Assets Under
Management that are Impact Investments:
Arborview's mandate is to invest exclusively into high-growth, mission-oriented companies that make a positive social and environmental impact and generate best-in-class financial returns. Our portfolio companies (and their missions) include: TemperPack (sustainable and recyclable packaging), Shenandoah Growers (sustainable food production, water conservation, land conservation, health and wellness), Rachio (water conservation), Vital Farms (ethical and sustainable food production, humane treatment of animals), Drexel Metals (sustainable building materials, energy efficiency) and LRI Energy Solutions (energy and water efficiency). We will not pursue investments into companies that are not impact-focused.
When evaluating a new investment opportunity, Arborview has an "Impact Questionnaire" that it uses to evaluate a company's intrafirm social/environmental sustainability practices. Some of the items covered on this questionnaire include: mission statement with positive social/environmental impact, corporate governance and a board that consistently evaluates the company's positive impact, the use of KPI's to track impact performance, financial and impact performance shared with employees, impact performance shared with the public, employee ownership, employee compensation including a company-wide bonus plan, employee benefits including (healthcare, retirement plans, dental, disability, life insurance, maternity leave, paternity leave, skills-based training, etc.), diversity of employees, board and shareholders, % of employees and suppliers that reside in low-income communities, charitable giving practices, tracking and reporting GHG, energy and water consumption and savings, third party social or environmental certifications.