Yale SOM Will Launch New Student-Run Impact Investing Fund

The new Meng Impact Investment Fund will give students hands-on experience selecting and funding organizations that seek to make a profit while also contributing to their communities.

The Yale School of Management will launch a new student-run impact investment fund in 2023, called the Meng Impact Investment Fund, that will enable students to gain experience in making hands-on decisions about investments in companies with a social purpose. The fund grew out of a multi-year student effort, and is being supported by a generous gift from Leon Meng ’97.

Yale SOM Dean Kerwin K. Charles said that the new fund will be a powerful addition to the student experience. “Our students are passionate about using the tools of business to make a difference, and this investment fund will give them a vehicle to both develop their analytical skills and see the long-lasting impact their efforts have on real organizations. I am proud that our students were so determined in advocating for this outcome, and truly gratified that with the generosity of Leon Meng we were able to make it a reality.”

The fund will begin operations in 2023. During the spring semester, student teams will work on developing the future structure of the fund, including defining its objectives, investment criteria, and other characteristics, with support from faculty and insights from experts in impact investing. The fund will likely begin to consider investments in the 2023-2024 academic year, according to Heather Tookes, deputy dean for faculty and professor of finance. Its operations will be overseen and supported by the International Center for Finance.

Tookes said that the impact investing fund is an expression of the SOM community’s values. “Consistent with the school’s mission to educate leaders for business and society, our students value the opportunity to both make a difference in the world and find opportunities that generate financial return. This is a way to marry those things,” she said.

The idea for the fund originated with students taking the Private Capital and Impact Investing course taught by Sue Carter four years ago. Vincent Caruso ’20, one of that first group of students alongside Alex Chen ’20, Anna Schikele ’20, Nate Schorr ’20, and Gabby Cazeau ’20, said that students believed SOM should be a leader in impact investing, given the “overwhelming interest” among the student body and the role SOM graduates have played in creating the field. Caruso is now an associate at DBL Partners, the pioneering impact investing venture capital firm founded by Nancy Pfund ’82.

Caruso said the student fund will give students interested in pursuing careers in impact investing new advantages. “SOM students will now have the opportunity to augment classroom learning with hands-on experience as impact investors charged with allocating real capital. For students applying to roles in the field, this new fund will allow them to speak to tangible accomplishments diligencing investments, structuring deals, and measuring the impact of portfolio companies. That experience is tremendously valuable to employers. The fund also creates a platform for students to leverage SOM’s growing impact investor alumni community—as advisors, speakers, or partners—strengthening the bonds between alumni and students.”

Leon Meng, whose gift is making the fund possible, is a veteran investor and founder of Ascendent Capital Partners Limited. He said the time is right to provide students with more experience thinking about impact in the investing process. “It’s a great pleasure to work with the school to think about impact investment. Traditionally, investment firms have made decisions about which companies to support with financial concerns front and center and have only considered factors like environmental and social impact later. But I think the new paradigm is to consider impact first, alongside economic viability. This is something my firm, Ascendent Capital, and myself personally support, and I’m pleased that the new fund will give SOM students direct exposure to such considerations.”

The student team that originated the plan for the fund in 2018 adopted the name Fishbowl Ventures. When the first group of student leaders graduated in 2020, they handed the reins to members of the next class—it wasn’t hard to find volunteers, they said, given the enthusiasm for creating such a fund at SOM. A survey conducted by Fishbowl in 2020 showed that 70% of respondents said they were interested in participating in a student-run fund.

Students developed a proposal for a fund and pitched it to SOM administrators over several years. The group also worked to support students interested in impact investing, starting a program called Fishbowl Fellows, which has paired 35 students with leading impact investment funds where they have worked alongside investors to identify impact-oriented investment opportunities and perform due diligence.

Charlotte Parker ’23, one of the current student leaders, said: “So many people come here to tackle big problems where the tools of capitalism can be effective in improving lives. The core curriculum. leaves room to grapple more intensely with questions of impact versus return, and an impact fund is a perfect place to be doing that. The fund will give more students the opportunity to think critically about what impact means and how you implement it in your career, whether you work at a fund or in some other role.”

Alex Healey ’23, another student leader who is a joint-degree student with the Yale School of the Environment, said that the new fund will complement existing impact-oriented resources at the school, including the Impact Investing Club and student participation in the Turner MIINT competition. “This whole process has been about learning by doing, but it’s also about community. A few cohorts of individuals have worked hard to get this over the finish line, and many of them have gone into the impact space and are already collaborating. We’re thrilled that those connections exist. And we’re really excited about what that means for the future, as participation in the fund becomes something that persists throughout students’ professional lives.”

Source: Yale School of Management