Understanding Private Investments in Emerging Markets
Sarona is all about private investments in emerging markets – a singular expertise aimed at lower mid-market companies serving the rising middle class. The investment focus is clear: securing strong financial returns by investing directly and through local funds and intermediaries. The core strategy has always been to blend financial success with the creation of deep, lasting impact. In essence, Sarona’s commitment means that every investment decision is guided by a firm belief that incorporating social and environmental values builds a better world for today and tomorrow…
Main Benefits of the Investment Approach
The benefits of this unique investment approach are many, and a look at the key figures and facts makes things crystal clear:
- Capturing growth – Investments target growth-stage companies catering to middle-class consumers in education, healthcare, financial services, and consumer goods.
- Active investing – Partnerships with all private equity firms in emerging markets help in building profitable, mid-market companies.
- Delivering impact – Engagement with local private equity partners ensures that impactful strategies, like gender equality and climate action, are put into practice.
- Low correlation – Investment portfolios show low correlation with developed market equities, offering diversification and a hedge against specific risks.
- Improved economics – Utilizing a mix of direct investments and fund investments provides highly diversified portfolios and a fee structure competitive with traditional funds.
- Investor partnerships – Some funds have secured partnerships with the US DFC, designed to boost limited partner returns.
- Industry expertise – A cumulative experience of over 80 years in private investments and fund operations builds tremendous trust and reliability.
Bespoke Investments through Separately Managed Accounts
Sarona isn’t just about standardized investment funds. It also excels in designing and managing bespoke investment accounts, known as Separately Managed Accounts (SMAs). These mandates are tailored to meet the unique needs of institutional clients. Each mandate builds on Sarona’s core expertise in private investments, emphasizing strong financial returns alongside a commitment to long-lasting impact. For instance, the Australian Development Investments (ADI), owned by the Government of Australia, targets countries in South and South-East Asia and the Pacific. The focus here is on financial intermediaries that support SME growth, drive gender equality, and nurture impactful management. This personalized approach illustrates the dynamic and flexible nature of Sarona’s overall strategy…
Sarona Funds and Investment Focus
On the funds front, Sarona operates with precision. The Sarona Global Growth Markets PE Fund 1 LP is a closed-end fund that has reached full investment, while the Sarona Global Growth Markets PE Fund 2 LP is still in the investing phase. These funds are geared towards capturing growth through investments in emerging markets. The funds take advantage of the rising middle class’s demand for quality goods and services, offering exposure to sectors that are not only growth-oriented but also contribute to societal development. This well-defined approach positions Sarona as a leader in private equity investments across diverse geographic regions.
Strategic Investment Ideas in an Impactful Framework
The investment strategy incorporates several key elements that work together to create both value and positive social change. First, capturing growth is at the heart of the strategy – focused on middle-class consumer sectors that drive everyday demand. Then, active investing is employed through strong partnerships with top-notch private equity firms, ensuring that profitable, mid-market companies are built strategically. Delivering impact through local partners helps change thinking and implement transformative strategies, particularly in areas like gender equality and climate action. Additionally, the approach offers less correlation with developed market equities, thereby diversifying risk. Improved economics emerges from a balanced mix of direct and fund investments, and investor partnerships add an extra layer of rigor that many traditional private equity setups can only envy. All of these elements come together to shape an investment method that is both innovative and impact-driven.
Project Impact on Sustainable Development
- SDG 5: Gender Equality – A focus on ensuring balanced representation and opportunities.
- SDG 13: Climate Action – Emphasizing investment decisions that contribute to climate resilience and environmental sustainability.
- SDG 8: Decent Work and Economic Growth – Supporting growth-stage companies that drive economic prosperity and innovation.
- SDG 10: Reduced Inequalities – Investing in initiatives that broaden access to quality goods and services for a wider population.
- SDG 17: Partnerships for the Goals – Leveraging strong alliances with local and global partners to achieve shared objectives.
The Global Mission for Lasting Impact
Beyond simply generating financial returns, Sarona takes pride in its legacy as a trailblazer in impact investing. The organization’s expertise, commitment, and long-term vision have made it a vital player in emerging markets. With 80+ years of combined experience and a B Corp score of 149.4 reflecting its conscientious approach, the mission is to democratize impact investing and support partners on their journey towards a brighter, more inclusive future. This vision imbues every investment decision – a blend of traditional financial savvy and forward-thinking impact strategies. The narrative is straightforward: fostering growth, empowering communities, and investing not only for profit but also for the greater good. The dynamic blend of innovative ideas and time-tested methods creates a rich tapestry that illustrates how smart investments can indeed change lives and economies across emerging markets…
