HarbourVest DEI Report

A review of our diversity, equity, and inclusion efforts

Investing with purpose

We are working to shape the future of private markets with a specific focus on making access to private capital more equitable. Our long history of investing in emerging and diverse managers and under-resourced markets continues today because we recognize the untapped potential of deserving managers who have been historically overlooked by mainstream investment channels, despite providing competitive financial returns. We believe providing support in this space will drive transformative changes that will benefit the private markets industry overall.

HarbourVest at Catalyst: California’s Diverse Investment Manager Forum

Co-hosted by the California Public Employees’ Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTRS), Catalyst brought together over 130 global investors representing a combined $1T in assets with the next generation of diverse emerging entrepreneurs to forge a new path in leadership and growth. HarbourVest proudly served as a co-sponsor for the two-day event and helped shape its narrative and impact by serving on the forum planning team and encouraging both investors and GPs to attend. 

Amanda Outerbridge served as panel moderator for Building a Successful Venture Capital Franchise in a Post-SVB World. Team members Juan Castano, Danielle Dobson, Teri Noble, and Sanjiv Shah attended the forum to reinforce the firm’s role as a proponent of change, actively driving conversation to challenge the status quo and promote inclusivity. 

Providing support for events like Catalyst is important because they allow us to meet new diverse managers and to champion existing partners who are focused on DEI initiatives.
Sanjiv Shah
Managing Director

Amanda Outerbridge

Managing Director

Diverse-led manager profiles: 

This year we are pleased to highlight LightBay Capital and Long Ridge Equity Partners as diverse-led firms to watch. HarbourVest has invested with both of these firms over multiple fund cycles because while each brings something very unique to the table, both epitomize the qualities and level of partnership that drive success.

Having recently completed fundraising for only their second fund, LightBay has quickly built an organization that looks beyond profit margins, taking steps to build a firm that has set high standards not only for performance results, but for people and giving back to the communities in which they live and work through its LightBay Foundation. Long Ridge is another example of what we would call a unique and distinctive firm in the private capital space. While the firm has recently completed fundraising for their fifth fund, they have been both measured and intentional in their growth. Launched in 2007 with a diverse leadership structure, the firm has long embraced the notion of an apprenticeship model, creating career paths and promoting from within to retaining talent that adds to their firm’s investment prowess, experience, and performance.

LightBay Founding Partner Nav Rahemtulla and Long Ridge Managing Partner Kevin Bhatt share their views on their very different paths to success, particularly as emerging and diverse managers face the challenges posed by a difficult macroeconomic backdrop.

Learn more about LightBay Capital
Learn more about Long Ridge

HarbourVest is proud to play a leadership role in the industry’s future by leveraging our platform and resources to support a more inclusive investment landscape, maintain a robust deal pipeline, and foster connection and collaboration among emerging and diverse managers.

Embracing partnerships

Nav Rahemtulla

Founding Partner

Can you describe LightBay’s commitment to DEI and why it is important,
both in terms of hiring and success?

For us to benefit from differing perspectives, we must be able to not just find diverse talent but also develop diverse talent. In hiring, we know that diversity begets more diversity and we have committed to ensure open searches at LightBay include diverse and underrepresented candidates. In terms of development, we have always prioritized creating an inclusive culture that encourages a growth mindset. We provide specific training in the “softer-skills” of private equity such as public speaking and executive presence along with senior-level mentorship so that all our associates, regardless of their identity, have an equal opportunity to thrive.

When it comes to success, we believe private equity firms can distinguish themselves with a rigorous commitment to excellence in their decision-making processes. Constantly challenging each other’s biases and opinions and soliciting perspectives from individuals of diverse backgrounds improves the quality of our discussions at LightBay.

LightBay is unique in how causes and organizations are provided support through your foundation.
Can you talk about that important work and how that support is funded? 

LightBay’s mission includes a commitment to supporting our companies, colleagues, and communities to reach their full potential. When we founded the firm, we created the LightBay Foundation to align our success directly with the success of our community. A fixed percentage of our management fees and carried interest are contributed to our charitable foundation every year.

Our grant-making foundation’s mandate is to provide access to high-quality education and healthcare to all families as well as to support poverty alleviation through financial support and job training. We support a variety of local, high-impact organizations that are tackling challenges in foster care, inadequate access to mental health, and impediments to social mobility. This year, our women leaders at LightBay are partnering with the organization, Rock The Street, Wall Street, to teach and mentor young women to explore the possibilities of an investment career at the first all-girls public STEM school in California. Later this year, our entire firm will volunteer with HabitatLA during our “Day of Giving,” in East LA to help build playhouses for younger children.

What is the one thing you would advise an investor to do to increase their exposure to diverse-led firms? 

The first step to increasing allocation to diverse-led firms is to get to know more of them. This year, both GPs and LPs alike are extraordinarily selective where they invest capital and therefore expanding the funnel of potential managers should be the starting point.

Investors can attend the various investment and asset management conferences that cater to women and underrepresented investors. Organizations such as WITH, KAYO, Synergist Network, AAAIM (Association of Asian American Investment Managers), and BWAM (Black Women Asset Managers) can be great resources to identify talent. Likewise, attending general asset management conferences can also provide opportunities to connect with diverse investors during specific DEI/Women breakout sessions and panels.

Kevin Bhatt

Managing Partner

Can you describe Long Ridge’s commitment to DEI and why it is important,
both in terms of hiring and success? 

Since the earliest days of our firm, Long Ridge has recognized that building a successful team that resonates with an increasingly diverse set of founders and investors would require a proactive approach to recruiting, training, and developing team members from a range of backgrounds and profiles. Over the last 15 years, we’ve seen first-hand how the diversity of our team has been a source of differentiation as we seek to secure investment opportunities in a competitive private equity market. Our commitment to providing a platform where a diverse group of talented team members can develop and perform to the best of their ability has made Long Ridge a destination employer.

At the portfolio company level, we’ve worked to build management teams and boards that are reflective of the diverse group of internal and external stakeholders at our companies. This effort has delivered value in reducing voluntary churn and increasing employee engagement, both of which drive enterprise value growth in the long term.

How has the partnership between HarbourVest and Long Ridge helped drive success for both firms?  

HarbourVest has been an incredibly valuable partner to Long Ridge. Since the beginning of our relationship, HarbourVest has actively shared best practices regarding LP reporting, fund structuring, and DEI initiatives, in addition to providing advice on a range of pressing questions on a more ad-hoc basis. The relationship has been highly aligned and collaborative, and has helped accelerate and professionalize our firm.  

What are a few of the biggest challenges you faced in building Long Ridge during its earlier vintages? What do you know now that you wish you knew at your launch? 

One of the biggest challenges we faced in the very early days of our firm was around clearly conveying the value that a Long Ridge partnership could deliver to founders and their stakeholders. Ultimately, the first several deals in Fund I were won through a significant investment of face-to-face time and development of relationships based on trust, respect, and shared incentives. While we continue to prioritize that personal touch, we are fortunate to now have a strong roster of current and former founders who are thrilled to share first-hand how Long Ridge has helped to transform, professionalize, and accelerate their businesses.

One other challenge we faced early on was driven by our decision to hire only at the junior levels of our firm, prioritizing internally-developed talent over senior lateral hires. While it would have been expedient to bulk up our leadership ranks in Fund I and II with outside talent, we felt strongly that shared culture, values, and perspectives would be critical to building a cohesive and effective firm for the long term. Today, we are thrilled to have a consistent and cohesive internally-grown team where all of our Partners, Principals, and Vice Presidents originally joined Long Ridge at the most junior levels of the firm.

Important Disclosures:

This material does not constitute an offer or solicitation for any fund sponsored by HarbourVest Partners, LLC (“HarbourVest”) or its affiliates, or any investment services provided by HarbourVest, and may not be relied on in any manner as legal, tax, or investment advice or as an offer to sell or a solicitation of an offer to buy an interest in a fund or any other investment product sponsored by HarbourVest. No sale will be made in any jurisdiction in which the offer, solicitation, or sale is not authorized or to any person to whom it is unlawful to make the offer, solicitation or sale. This document includes information obtained from published and non-published sources that HarbourVest believes to be reliable. Such information has not been independently verified by HarbourVest. Unless otherwise specified, all information is current at the time of issue. Any opinions expressed are those of HarbourVest and not a statement of fact. The opinions expressed do not constitute investment advice and are subject to change.

The companies and GPs discussed in this report are intended for illustrative purposes only, do not represent all of the investments made, sold, or recommended for funds or client accounts, and should not be considered an indication of the performance or characteristics of any current or future performance HarbourVest fund or investment strategy. It should not be assumed that an investment in the company or fund sponsored by a GP discussed in this report was or will be profitable. Actual investments will vary for each fund and client and there is no guarantee that a particular client’s account will hold any or all of the investments identified herein.

Any published third-party ratings or rankings discussed herein are not representative of any one client’s experience with HarbourVest and are not indicative of HarbourVest’s future performance. Ratings and rankings have inherent limitations and qualifications, and are not indicative of the experience of any client or investor or of the future performance of any product. There can be no assurance that the universe upon which the awards were based included all investment products within each category that are actually in operation or existence. Unless otherwise specified, all awards shown are based on the one-year period immediately preceding the date listed.

Certain information contained herein constitutes forward-looking statements, which can be identified by the use of terms such as “may”, “will”, “should”, “expect”, “anticipate”, “project”, “estimate”, “intend”, “continue”, or “believe” (or the negatives thereof) or other variations thereof. Due to various risks and uncertainties, including those discussed above, actual events or results or actual performance may differ materially from those reflected or contemplated in such forward-looking statements. As a result, investors should not rely on such forward-looking statements in making an investment decision. Any forecast provided herein is based on HarbourVest’s opinion of the market as of the date of preparation and is subject to change, dependent on future changes in the market.

The principles related to sustainable and responsible investing discussed above represent general goals that will not be achieved by investment selected. These goals are not representative of current processes or outcomes for every strategy, and may not be fully realized for all products or client accounts. There can be no assurance any initiatives or anticipated developments described herein will ultimately be successful. The information provided is solely for informational purposes and should not be relied upon in connection with making any investment decision. It should not be assumed that any ESG initiatives, standards, or metrics described herein will apply to each asset in which HarbourVest invests or that any ESG initiatives, standards, or metrics described have applied to each of HarbourVest’s prior investments. ESG is only one of many considerations that HarbourVest takes into account when making investment decisions, and other considerations can be expected in certain circumstances to outweigh ESG considerations. The information provided is intended solely to provide an indication of the ESG initiatives and standards that HarbourVest applies when seeking to evaluate and/or improve the ESG characteristics of its investments as part of the larger goal of maximizing financial returns on investments. Any ESG initiatives described will be implemented with respect to a portfolio investment solely to the extent HarbourVest determines such initiative is consistent with its broader investment goals. Accordingly, certain investments may exhibit characteristics that are inconsistent with the initiatives, standards, or metrics described herein.

For additional legal and regulatory disclosures related to HarbourVest offices and countries, please refer to Important office and country disclosures.

Continuation solutions encompass a host of transaction types in which a GP secures interim liquidity and/or additional primary capital for their LPs in a strongly performing asset, or set of assets, that the GP will continue to own and control. Specifically, they include continuation funds, new funds created by GPs for the purpose of acquiring the asset(s) that continue to be managed by the same GP and capitalized by one or several secondary buyers, or equity recapitalizations involving a direct equity or structured equity investment into a portfolio company. These transactions can also include a parallel investment from the GP’s latest fund into that same pool of assets (a “cross-fund trade”).