Fund II Investment Profiles

Investment and Financial Thesis

• The Company is underpinned by strong industry tailwinds driven by increasingly stringent global regulatory environmental policy and perceptions, with a substantial amount of whitespace growth opportunities

• Highly underpenetrated market is now experiencing an inflection point as many companies are increasingly focused on ESG issues and have announced corporate actions to offset their carbon footprints

• Attractive financial profile driven by consistent top-line growth ahead of market comparables, in an asset-light business with low capex requirements and strong cash conversion

Recent Activity

• The Partnership fully funded its investment in January 2022 

• ACT is on track to outperform its 2022 budget, and therefore generate enhanced impact, due to favorable market conditions (COP26 boost & noted enhanced voluntary action from organizations on environmental impact)

  
  

CO₂ Emissions Offset

 Impact Thesis

• The Company is the largest intermediary in environmental certifications, with the broadest suite of products and widest geographic reach across the value-chain. ACT offers approximately 80 products across five core markets: Carbon emission allowances, energy efficiency certificates, bio certificates, renewable energy certificates and voluntary carbon offsets.
• Carbon offsetting programs promote improved climate change management and reduce environmental impact. As the company grows its customer base and product offering, it facilitates corporations’ access to environmental solutions.

Impact and Investment Thesis

Sleep dysfunction is a chronic widespread issue, with 50 million to 70 million Americans reporting dysfunctional sleep and an estimated 54 million adults suffering from sleep apnea. The CDC has labeled insufficient sleep as a “public health epidemic.” Accessibility is key to ensuring positive patient outcomes, and when combined with a more affordable and comprehensive solution, BetterNight (fka SleepData) is better able to serve customers than competitors.

Recent Activity

• In November 2021, the Company partnered with Peerbridge Health, a digital health company focused on heart disease, to accelerate the diagnosis and treatment of patients with both atrial fibrillation and sleep apnea in cardiology practices 

• In January 2022, Hamilton Lane invested an additional $12.5 million in the Company’s bridge financing round through HL Impact Fund II to support continued growth. HL Impact Fund I previously invested in BetterNight (fka SleepData) in 2021 

• In 2022, the Company recognized a link between diabetes and sleep apnea, and began working with diabetes practitioners, providing the tools necessary through the BetterNight telehealth platform, to better manage patient needs 

• BetterNight (fka SleepData) maintained high patient compliance & satisfaction scores while continuing to scale the business

Fund II Investment Profiles

Fund II Investment Profiles

Investment and Financial Thesis

• The Company is positioned to benefit from the evolving trends of high-power output through its advanced R&D capabilities and adoption of its double-fed induction technology, which enables wind turbines to achieve optimal coordinated load distribution and reliable, long-term sustainable energy production compared to competitors
• Envision Energy has strong manufacturing capabilities with industry-leading supply chain management, which contributes to lower production costs and pricing advantages given its high proportion of in-house R&D and production capabilities
• Hamilton Lane received proprietary access to this deal through our local presence in Hong Kong
• China aims to achieve carbon neutrality by 2060

Recent Activity

• In 2021, Envision Energy installed a total of 8.5GW of wind turbine capacity, exceeding its full-year target, and was ranked #2 by volume globally

• In 2021, the Company’s Galileo wind turbine set an industry benchmark for lowest lifecycle carbon emissions in the wind industry

• In 2022, Envision Energy delivered the world’s first batch of net-zero batteries to receive the Carbon Neutral Certificate from TÜV SÜD, a widely recognized organization providing trusted safety, security and sustainability solutions

• In July 2022, the Company announced its partnership with the Government of Spain to build the first Net-Zero Industrial Park in Europe. Envision Energy aims to construct 100 Net-Zero Industrial Parks in the next decade, effectively reducing global carbon emissions by 1 billion tons per year.

• Envision Energy plans to achieve carbon neutrality in its operations and acquire 20% market share, targeting wind turbine shipments of 10GW capacity, by the end of 2022

Impact Thesis

• Envision Energy promotes renewable energy adoption by producing and maintaining wind turbines equipped with efficiency-increasing technology, aiming to ultimately achieve net-zero emissions

• Strong secular tailwinds such as carbon-neutral pledges from both companies and countries, as well as accommodative public policy align with the renewable energy transition facilitated by the Company

• Envision Energy is well-positioned to continue scaling and contributing to the renewable energy transition as the #4 ranked wind business by volume globally and #2 domestically, with the highest growth rate compared to other leading players in 2020

Fund II Investment Profiles

Recent Activity

• The Partnership funded $7 million of its investment in March 2022

Investment and Financial Thesis

• High-growth, high-margin product with demonstrated strong demand for green solutions and with international whitespace
• Backed by secular tailwinds including the increasing use of pipettes and disposable plastic across laboratory settings, as well as the increased awareness of the mission-critical nature of pipette supply due to COVID-19-related supply chain issues
• Hamilton Lane received proprietary access to the deal and was specifically sought out by the Sponsor given our Impact focus and prior partnership in Impact Fund I company, AeroSafe

It’s estimated that there are enough pipette tips discovered in landfills each year to circle the earth 6x

Reduce Cost Reduce Waste

Labs who use Grenova devices are reducing their consumable biohazard waste and cutting down costs up to 90%.

Impact Thesis

• Grenova provides the life sciences industry with the only patented and scientifically proven green technology capable of washing and reusing plastic consumables to make labs sustainable, efficient and resilient to supply chain disruptions
• Laboratory plastic waste accounts for 2M tons of waste in the U.S. alone. Pipette tips are a substantial portion of this waste and the target area for Grenova to-date, though scope exists beyond pipettes.

Fund II Investment Profiles

Recent Activity

• The Partnership fully funded its investment in August 2022

Investment and Financial Thesis

• Level Access has an end-to-end SaaS solution for the development, testing and remediation of accessibility services, and a simpler and more complete value proposition than other piecemeal solutions
• Market is at an inflection point (30% growth expected through 2025), with macro & regulatory tailwinds providing an attractive market opportunity

Impact Thesis

• Platform for businesses to assess, create, remediate and monitor the suitability of their digital assets for disabled users
• Equitable digital accessibility is becoming increasingly critical as many modern goods and services are only attainable through digital means
• Job applications, travel bookings and online education are common tasks that digital tools have made more convenient for the general population, but are currently often inaccessible for disabled individuals

Fund II Investment Profiles

Recent Activity

• The Partnership fully funded its investment in July 2022
• Stop Soldier Suicide, an organization focused on improving mental health among veterans, announced a partnership with NeuroFlow with a goal to track symptoms more efficiently and deliver customized education and awareness tools within the community

Investment and Financial Thesis

• The U.S. behavioral health market is expanding with a need to rein in costs and increase efficiency. NeuroFlow’s software addresses both of these pain points.  
• The Company has a robust and scalable economic model with a highly variable cost structure, and with 80%+ gross margins while addressing a key need in healthcare.
• Blue-chip customer base includes Prudential, Magellan, Trinity Health, Capital Blue Cross, U.S. Air Force, U.S. Army and U.S. Navy, among others

Virtuous Feedback Loop

Impact Thesis

• NeuroFlow’s hybrid care model, where digital engagement reinforces in-person clinical care, presents a unique opportunity to enhance the overall effectiveness of behavioral healthcare  
• The Company uses its proprietary data set to identify high-risk patients and then directs patients to the proper care at the correct time
• Behavioral health conditions are expensive, difficult to treat and often forgotten until health crises arise – NeuroFlow helps health systems identify, engage and treat patients effectively
• The Company’s CEO experienced firsthand the gaps in the behavioral health system when he returned from military service abroad and saw how veterans and civilians alike face too many barriers when it comes to receiving appropriate, timely care

Fund II Investment Profiles

Recent Activity

• As part of our initial investment in October 2021, Penn Foster acquired Carrus, a provider of online healthcare training and professional development, broadening the types of opportunities available to Penn Foster students and making it one of the largest skills-based training platforms in the country
• In February 2022, the Company was included in the GSV EdTech 150 List, identifying it as one of the most transformational private companies in the digital learning space
• In March 2022, Thrive Pet Healthcare partnered with Penn Foster, sponsoring its veterinary assistants in the completion of the Company’s Veterinary Technician Associate Degree

Investment and Financial Thesis

• Penn Foster is a market leader in an industry backed by tailwinds as the shift to online education and increased demand for middle-skill workers is expected to continue, with a current lack of labor supply creating future enrollment demand
• The Company displays recession-resilient characteristics as unemployed workers take the opportunity to reskill during downtimes
• Hamilton Lane received proprietary access to the deal through proactive outreach to the Sponsor and an existing relationship with another co-investor

$40,000

$33,000

$14,000

$4,000

$1,000

Penn Foster

Coding Bootcamps

Community Colleges

National College Average

For-profit Colleges

Average Student Loan Debt by Institution Type - 2020

Impact Thesis

• Penn Foster addresses the high financial and lifestyle costs associated with higher education by offering a low-cost, high-value, flexible solution that allows students to graduate debt-free and develop skills that are in high-demand by employers. On average, a Penn Foster student only pays approximately 10-20% of tuition compared to similar two-year programs at a community college.
• The Company provides access to education through its self-paced, career-relevant programs, including high school equivalency, college degree, veterinary, allied health, skilled trades, art/design, business and other verticals
• Penn Foster’s growth will directly result from increased student enrollment, completion rates, access to education and employment outcomes. The Company’s completion rates perform in line with similar institutions.

Fund II Investment Profiles

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