Bill McGlashan, co-founder of the Rise Fund, resigned earlier this month, following his involvement in the recent US college bribery scam. McGlashan was one of 50 people indicted.
The Rise Fund was launched by US private equity firm TPG in 2016, and counts high-profile names including U2’s Bono, Jeff Skoll, Paul Polman and Richard Branson on its board. One of its aims is to ‘expand access to educational attainment’.
Insiders expect fundraising to slow, but not stop, for The Rise Fund II, targeted at $3bn, according to Impact Alpha. The fund raised – and has almost fully allocated – $2bn for its debut fund.
The scandal has prompted a number of reactions.
Anand Giridharadas, author of Winners Take All, tweeted: “I called for a moratorium on impact investing until finance unwinds its own complicity in the injustices it purportedly wants to help solve. I redouble that call now. This should be a signal moment for #ImpInv to reflect and regroup.”
Others were more measured. In a post on Medium, Jed Emerson writes that many in the sector “cringed at the hubris” when Rise Fund was launched and at its “pre-selling of “new” approaches to metrics that quite simply were/are not new at all” – things that “should have been red flags”. In future, the sector needs to beware of its “less than critical acceptance of all who come to claim the banner of impact”. But, he adds, the scandal shouldn’t divert attention: “Let’s get back to the business at hand,” he writes.[…]