In Morrison and Foerster’s special shelter-in-place edition of “Impactful Conversations” podcast, MoFo’s fund formation lawyer Sean Byrne interviews Buckhill Capital’s General Partner Henrik Jones about collaborating with MoFo to create a new investment term, the Carried Interest by Verified Impact Calculations (CIVIC). The CIVIC links a fund’s carried interest to quantifiable impact metrics, and thus has the potential to create billions of dollars of incentives for institutional investment managers to pursue impact goals alongside financial returns. This project is a finalist for NYU’s Grunin Prize for Social Entrepreneurship. The nominated legal team: Suz Mac Cormac, Sean Byrne, and Jesse Finfrock.
Having worked in the investment business for nearly 40-years, Henrik had most recently been working as a traditional private equity manager until about five years ago, when his daughter asked him, “Why don’t you try to do more than just make money? It’s not much of a legacy.”
“And so she challenged me to do something that would also have a positive impact. And that was really exciting,” Henrik explains.
The innovation of Buckhill Capital and Morrison & Foerster is that the CIVIC can be imported into the relevant documents of most any venture capital or private equity fund so that this carried interest is paid out to a fund manager only to the extent that the fund achieves quantified, verifiable impact metrics agreed upon by the fund manager and the fund’s investors.