I’m a (fairly) young LP at a small fund and I’m torn between two paths for my next chunk of capital.
On one side: a very “traditional” PE-style opportunity with solid historical IRR, but zero real consideration for climate/societal impact beyond basic ESG checkboxes.
On the other: a longer-horizon vehicle that backs early-stage, impact-focused companies and real assets (think climate infra, circular economy, etc.). The thesis is that solving big systemic problems at scale will drive outsized financial returns over 10–15 years. I genuinely \*want\* to believe this, but I’m trying not to drink the Kool‑Aid.
For those of you actually allocating to impact / climate / “profit + purpose” strategies:
\- Have your financial returns matched your more conventional investments?
\- Any frameworks or metrics you use to separate real impact from greenwashing?
\- Anything you wish you’d known before committing to this kind of strategy?
Would really appreciate brutally honest takes, success/failure stories, books/blogs/pods, or even specific fund structures you think get this balance right.