Aligning growth and impact are key to harnessing purpose for competitive advantage.
By Tripp Baird
When growth is correlated with positive social and environmental impact, businesses can generate value for shareholders and stakeholders. At The Builders Fund, a private equity platform, we seek out collinear business models that embed impact alongside commercial growth and where purpose can be harnessed for competitive advantage. Our approach to impact value creation spans the investment lifecycle from capital formation to company vision, operations, and corporate form. Here’s a closer look at three impact companies we invest in and the difference they’re making.
Acelero LEARNING: Increasing Impact Through Purpose-Driven Investment
In 2022 Builders co-led a strategic investment in Acelero Learning, an early childhood education provider seeking to eliminate gaps between children’s potential and their achievement in school and life. Acelero serves low-income children and families as a direct operator of Head Start centers and through tech-enabled services to other Head Start operators, states, and municipalities. The company also provides training, technical assistance, and consulting services to bring its innovative practices to other childcare centers across the country, reaching over 400,000 children and families annually.
Builders co-led a syndicate of impact investors, including the BlackRock Impact Opportunities Fund and A-Street Ventures, catalyzing additional investment into Acelero Learning. At the time of investment, the company sought growth capital to expand the business and its impact, including the number of students and families served, and enhancing the business’s existing commitment to equity through workforce engagement. Builders led the creation of an Operating Blueprint focused on building the sales and marketing team and commercializing products and existing intellectual property. Through the combination of convening purpose-driven capital and operational engagement, Builders aims to create shared value for the investor group, the management team, and most importantly, the children, families, and communities Acelero serves.
Traditional Medicinals: Articulating Purpose, Values, and Vision
Traditional Medicinals, a certified B Corporation and California Green Business, is a pioneer of the wellness tea category in the U.S. and Canada. It was formed in 1974 to educate consumers about the benefits of traditional herbal medicine while re-inventing the industry of plant-based medicine. The company has a long-standing commitment to positive social and environmental impact through sustainable production practices and engagement with the often impoverished and indigenous herb-sourcing communities in its supply chain.
Purpose creates a fertile ground for increased alignment through shared values with employees and customers, from attracting and retaining top talent to improving customer service, increasing customer loyalty, and improving net promoter scores. Builders believes that purpose, values, and vision cannot come from the top of the company in a vacuum. They are more than the output of a meeting; they emerge from a participative process. Working with management, Builders helped facilitate a yearlong collaborative and companywide process to reexamine and redefine the purpose, values, and vision of the company. Its crystallized purpose, “to inspire active connection to plant wisdom in service of people and planet,” has since become a foundation for a realignment of strategy, an acceleration of in-market performance, and a flourishing of a 50-year-old culture to continue its remarkable run to leadership in the U.S. tea and medicinal supplement space.
PosiGen: Committing to Being a Force for Good
Headquartered in New Orleans, PosiGen is the nation’s leading residential solar and energy efficiency provider for low-to-moderate income families. The company’s mission is to close the clean energy affordability gap for LMI homeowners by delivering lower-cost utility bills along with the environmental benefits of clean energy through rooftop solar and energy efficiency upgrades.
PosiGen makes an impact in underserved communities by facilitating annual household savings of upward of 20% on energy bills, with more than $190 million in savings to date. It also generates quality job opportunities in communities where it operates, with more than 65% of its staff identifying as women and/or Black, Indigenous, and people of color. These social benefits are intrinsically linked to the company’s positive environmental impact, with access to clean, reliable energy expanding to new homes and communities, helping reduce and avoid greenhouse gas emissions.
After completing a Series D investment led by The Builders Fund and a subsequent growth capital round from Builders and other investors in 2022, PosiGen became a public benefit corporation and certified B Corp in 2023. Certified B Corporations meet the highest standards of verified social and environmental performance, public transparency, and legal accountability and aspire to use the power of markets to solve social and environmental problems.
The Builders Fund, which has been a certified B Corp since 2015, provided PosiGen with guidance and support throughout the B Corp certification process in alignment with the fund’s impact management and measurement strategy. Builders leverages B Corp certification as part of its impact framework because it supports companies that seek to integrate purpose and profit and make decisions for the benefit of all stakeholders. Purpose-driven companies are uniquely positioned to deepen impact, improve transparency, and create value for stakeholders across the corporate ecosystem.
