Impact Engine targets $100 mln for debut PE fund, raises capital from family offices

  • Why this is important: Family offices are investing in impact-oriented funds
  • Impact Engine raises hybrid PE fund
  • Also raising second venture fund

Impact Engine, an investor in early-stage and Series A impact ventures, is raising its first hybrid PE fund, targeting $100 million.

The fund will invest in emerging PE funds and make direct investments.

Impact’s debut impact-focused PE fund has already raised $10 million, primarily from family offices, a source familiar with the company said.

Impact Engine will raise the capital for the PE fund from family offices, endowments and foundations, the source said.

“These institutional investors are early adopters of impact investing,” the source said.

Impact’s PE fund will invest $10 million to $20 million in emerging PE managers raising their first funds focused on impact investing. It is targeting five to seven such investments, the source said.

Directs will essentially be co-investments with other strategic investors, the source said. The fund will make eight to 12 co-investments, investing $1 million to $3 million each, the source said.

The levels of due-diligence and other processes are as stringent as in a regular PE fund but with an added layer of demonstration of meaningful impact, the source said.

Education, cleantech, food and healthcare are some sectors Impact Engine will invest in, the source said.

Chicago-based Impact Engine started as an accelerator in 2012 and raised its first venture fund, targeting $10 million, in 2015. Investments from its first fund include Edovo, Full Harvest and ThinkCERCA.

Impact Engine is also raising its second venture fund, targeting $25 million, according to the source.

The fund has raised $10 million from 32 investors thus far, the Form D said. The minimum investment for the venture fund is $50,000.

Senior management at Impact Engine includes Jessica Droste Yagan, Roger Liew, Valerie Hedge, Priya Parrish and Tasha Seitz.

Action Item: Read more on Impact Engine here