Any junior employee working for SustainVC learns when they join the firm the professional and personal skills are required to advance to partner. Impact Engine provides young impact professionals with a career advancement framework that includes expectations from managers, skill sets to develop and access to executive leadership. HCAP Partners helps junior staff design career roadmaps.
These firms are at the forefront of impact talent development and offer models for other impact organizations to follow in fostering the next generation of impact leaders.
Entry-level and junior impact professionals are having difficulty carving a formal pathway to their ideal roles in a relatively young field of finance, finds a new report from Impact Capital Managers. Among their specific challenges: finding quality mentorship, especially within smaller investing teams. Young professionals from underrepresented backgrounds in particular struggle to find mentorship programs centered around inclusion.
Many of those who do advance to partner level struggle to come up with the capital to make general partner commitments.
“What we heard from many emerging leaders was the desire to have proactive and honest discussions with their managers about the steps and skills needed to progress to the partner-level throughout their careers,” writes ICM in “Paths to partner: Empowering emerging leaders for firm-wide success.”
“By sharing the experiences and reflections of established leaders, we hope to create a stronger pipeline that helps to attract more talent to the industry,” says Salesforce Venture Impact Fund’s Adrianna Alterman, who co-chaired ICM’s research committee.
Impact talent management
ICM conducted a series of interviews with employees and fund managers on the challenges to career development in impact investing. Among the positive models it identified: Philadelphia-based SustainVC’s transparent practice of outlining potential durations, advancement timelines and compensation levels for each role at the firm. In addition to its career advancement framework, Impact Engine in Chicago offers employees guidance on how to fulfill expectations at each level, including for associates and analysts.
“Impact Engine’s intentionality in developing this resource and sharing it proactively with team members promotes a sense of partner interest and investment in their emerging leaders’ success, giving junior talent insight into growth potential,” ICM notes.
San Diego-based HCAP Partners, which invests in quality jobs as an impact strategy, works to practice what it encourages at portfolio firms. The goal of career advancement conversations between junior and senior firm members “is to create an open, development-focused dialogue in which both leadership and staff can feel invested.” Conversations are recorded in a career development tracker and accompanied by “specific, measurable, achievable, relevant and time-bound, or SMART, objectives.
Learning from leadership
ICM encourages today’s impact leaders to share their experiences in building their careers in impact investing.
Rethink Education’s Amy Nelson was a first-generation college student who developed a passion for fostering more equitable access to education working for education NGOs. At Rethink, a New York-based edtech investor, she leads fundraising and investor relations and sits on the firm’s investment committees. Last month, she became the firm’s third managing partner. She dedicates time to mentor junior professionals and encourages them to prioritize learning and building credibility.
Elizabeth Chou, a partner at North Carolina-based education impact investor Leeds Illuminate, started her career in commercial lending at M&T Bank. After earning an MBA from Columbia Business School, she went into education investing at New Markets Venture Partners. She progressed from senior associate to general partner in nine years. As a female fund manager, Chou is especially focused on helping other female impact professionals trust that they can figure things out as they go.
Both Nelson and Chou serve as mentors for ICM’s Mosaic Fellows, an annual program designed to provide top-performing graduate students from underrepresented backgrounds with fund management experience. Mentors from 120 ICM member firms, which collectively manage more than $50 billion, also participate.
Impact fellows
Mosaic has graduated 90 fellows, most of whom have gone into careers in impact and sustainable finance. This year’s cohort was its largest with 25 fellows. ICM network members like Ecosystem Integrity Fund, Closed Loop Partners and Clean Energy Ventures have hired from the program.
“Advancing skilled, diverse talent in impact investing has been an objective for ICM since our founding five years ago. The Mosaic Fellowship was our first major initiative reflecting the depth of our commitment,” ICM’s Marieke Spence tells ImpactAlpha.
The goal of its latest research is to “illustrate the variety of career paths that can lead to a partner or managing director role at a fund; it’s not always linear,” she adds. “We hope the report will encourage more funds to establish clarity and transparency around team roles and the skills needed to advance over time.”
