Jeff Skoll first became well-known as the president (and first full-time employee) of a nascent Internet marketplace known as eBay.
Then he built a platform for social entrepreneurship and social innovation as the benefactor of Skoll Foundation and the host of the annual Skoll World Forum at Oxford. His social-action movie company, Participant Media, has won Oscars for Spotlight, Green Book and An Inconvenient Truth, among other films.
Since 2000, Skoll’s fortune, estimated by Bloomberg at $5.9 billion, has been managed by Capricorn Investment Group, which over time has taken on outside clients as well and now has about $9 billion in assets under management.
Capricorn is now seeking to amplify its own impact by bringing in new investors to mobilize additional capital for climate action, health, inclusion and “sustainable markets,” Capricorn’s Kunle Apampa tells ImpactAlpha on the latest Agents of Impact podcast.
‘If you speak to folks here at Capricorn, they’ll tell you, ‘Great, we’ve built all this IP around sustainability and integrating this into the investment process. But we cannot get to where we need to get to if others are not buying into this model,” says Apampa, who joined Capricorn from Goldman Sachs in 2021.
Kunle is working to share Capricorn’s capabilities with other “asset owners that get it and are willing to put their capital to work as well.”
Capricorn is seeking to differentiate itself in the market for “outsourced chief investment officers,” or OCIOs, with a pitch that combines 100% mission-aligned portfolios with “competitive risk-adjusted returns.” Many smaller foundations and family offices enlist OCIOs to manage their assets rather than building out their own investment teams.
“High-conviction, deeply researched and out-of-the-mainstream ideas,” is what Kunle considers
Capricorn’s calling card. “That’s where you’re going to find alpha. That’s not in the normal flow of how everyone else is chasing alpha.”
Competition for impact investment mandates can be intense. The Nathan Cummings Foundation, which committed in 2018 to align its endowment 100% with impact, found that OCIOs “had a collective weakness in the area of racial justice,” according to a 2021 report. The foundation chose San Francisco-based Bivium Capital and Westfuller Advisors to manage its then-nearly $500 million in assets.
“We are pleased with their economic performance and are pleased to be on this impact journey,” Cummings’ Rey Ramsey tells ImpactAlpha. “Our overall impact lens is to seek racial , economic and environmental justice in our ‘totality of assets’ approach.”
When the Skoll Foundation in 2021 adopted strategies around racial justice and equity and inclusive economic growth, it worked with Capricorn to align its endowment portfolio as well. That led to investments in Apis & Heritage Capital Partners’ Legacy Fund I, which helps businesses with large workforces of color transition to employee ownership, and Zeal Capital Partners’ Fund, which invests in fintech and future-of-work solutions designed to narrow racial wealth and skills gaps.
Capricorn can point to its own track record in climate and energy investing through its Technology Impact Fund and Technology Impact Growth Fund. Technology Impact Fund I invested in technology moonshots such as Helion’s small-scale fusion reactors, Form Energy’s long-duration iron air battery technology and Span’s home-electrification products (see, “SPAN raises $90 million to upgrade the lowly circuit panel and electrify everything”). Technology Impact Fund II has placed bets on green steel, sustainable lithium production and quantum computing.
Of the approximately $6 billion in Capricorn’s OCIO business, about $3 billion, is invested in products or managers that Capricorn has seeded or started itself, Apampa said. Capricorn’s Sustainable Investors Fund has helped seed more than a dozen impact fund managers that operate independently, including real assets investor Vision Ridge Partners and Martis Capital, formerly Capricorn Healthcare.
“The goal isn’t to allocate capital into our strategies,” Apampa says. That said, “If you have strategies that are consistently in the top quartile, you definitely want to deploy capital in places where you’re going to see the return from a double-bottom-line standpoint.”
OCIOs manage assets across public markets, including equities, cash and fixed income, and in private markets, from early-stage to venture capital to private equity and private credits, and including real assets, real estate and infrastructure.
“You tend to see higher levels of expression of financial inclusion or inclusive capitalism, in strategies such as private credit,” Apampa said. “And an environmental thematic focuses more on the infrastructure / private equity / VC model.”
Apampa sidestepped a question about the politically driven backlash to ESG investing (incorporating environmental, social and governance factors).
“I want to be in the business of, rather than talking about it, proving, showing, designing and producing roadmaps that show you that because you’re incorporating sustainability and impact into your portfolio doesn’t mean that you need to give up alpha or give up returns,” he said
“As a matter of fact, I make the argument that it can enhance the way you do things,” he added. “Because what that does is gives you a true north star of where you need to be as a portfolio.”