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CREATING GAINFUL JOBS HCAP Partners 2017 Annual Impact Report

HCAP Partners Snapshot

  • Provider of growth capital to lower -middle market companies throughout California and the Western U.S.
  • Raised over $210 million in total capital commitments across three funds since its inception in 2000.
  • 31 investors across two institutional impact funds.
  • Recognized impact fund manager focused on improving job quality standards.
(1) As of 12/31/2017 or as of exit for realized investments. (2) Impact metrics from HCAP Partners III, L.P.
HCAP Partners team (from left to right): Carrie Xia, Kurt Noyes, Jennifer Neivert, Tim Bubnack, Frank Mora, Hope Mago, Nicolas Lopez, Bhairvee Shavdia

Message from the Team

HCAP Partners remains committed to fostering high-quality jobs for all our portfolio company employees and believes that high-quality jobs are a key component of a company’s economic well-being. In 2016, HCAP Partners rolled out its impact framework around quality jobs, the Gainful Jobs Approach, across the portfolio(1), working with management teams to assess current job quality standards and identify key improvements to strengthen benefits and workplace practices. This year, HCAP has highlighted the new workplace initiatives put in place by two portfolio companies, Cubex and Mission Senior Living, to improve job quality standards, build a strong company culture, and help with the recruitment and retention of staff as both companies experience significant growth.

In 2017, HCAP Partners exited six portfolio companies. This year’s Annual Impact Report includes a case study on HCAP’s exit from Lucernex and details HCAP’s exit considerations and successful outcomes from both a financial and impact standpoint. Through this exit process, HCAP has learned the importance of including all employees in the economic outcome of a successful sale of a business.

HCAP Partners has greatly appreciated and benefited from the guidance of its limited partners in building out and implementing its impact framework. To that end, HCAP is pleased to announce the creation of a formal Impact Advisory Board as a part of its forthcoming fund.

HCAP Partners remains thankful for your support of its impact initiatives and continues to welcome opportunities for collaboration and feedback.

(1) HCAP Partners III, L.P.

Thought Leadership & Recognition

Founding Member

In 2017, HCAP Partners became a founding member of Impact Capital Managers - a network that brings together venture capital and private equity funds that are deeply committed to impact investing in the United States.

Top PE Firm Recognition

HCAP Partners was included on the 2018 Top 50 Middle Market Private Equity Firms list published by Grady Campbell. The firms on this list are recognized for solid performance, innovation, successful track record, leadership and results.

Expert Advisors

HCAP Partners was represented on an Expert Advisory Panel formed by Fannie Mae to support its Sustainable Communities Innovation Challenge, which includes experts in economic development, employment, and innovation.

Commitment to Intentional Impact

The IA 50 is the only free, public, searchable database of outstanding impact investing fund managers. In addition to providing a gateway into impact investing for financial advisors and their clients, the ImpactAssets 50 also presents fund managers that are leaders in this rapidly growing field, and are paving the way through their investments as well as their impact reporting. (Source: IA 50 website)

Furthering the Local Landscape for Impact Investing

Impact Investment Strategies and Stories from San Diego
San Diego, CA

In partnership with The CAPROCK Group and hosted by the San Diego Grantmakers, HCAP Partners was a featured panelist in a session discussing approaches to impact investing strategies that achieve social gains alongside financial returns.

Quality Jobs Convening Working Session
San Francisco, CA

HCAP engaged with other leaders and experts in an initiative by The James Irvine Foundation to explore how to catalyze and build a market for capital that supports the creation of quality jobs in California.

Creating Gainful Jobs

This year’s Annual Impact Report focuses on initiatives implemented by HCAP’s portfolio companies to facilitate improvements in job quality standards. Essentially, these are the steps taken by our portfolio companies in relation to completing 2017 goals as outlined in their Strategic Roadmap. To readers for whom HCAP's impact approach may be new, please reference the Appendix to this report for an overview of the Gainful Jobs Approach.

The 2017 Annual Impact Report also builds on the information presented in the 2015 and 2016 Annual Impact Reports and it is helpful to read these reports sequentially.

GAINFUL JOBS APPROACH

Cubex: An Overview

Founded in 2008 and located in Arizona, Cubex provides customers in the medical (outpatient and long-term care), dental and veterinary markets with secure Point of Use dispensing cabinets supported by cloud-based software.

The following pages provide a comprehensive view of rolling out the Gainful Jobs Approach at Cubex from initial data collection to implementation of Cubex's management approved Strategic Roadmap. This year, we have highlighted the new workplace initiatives put in place by Cubex to improve job quality standards. These include wellness offerings, education benefits, and community engagement through a formalized intern program.

Metrics as of 12/31/2015 Baseline Assessment

Cubex: Baseline Assessment

(1) As of 12/31/2015 (2) Internal promotion percentage calculated as number of internal promotions over the last 12 months over new jobs created in the same period. (3) Sustainable livelihood eligibility determined as percentage of workforce earning greater than industry mean based on total industry average per  NAICS (North American Industry Classification code) code. Earnings as per base salary.

Cubex: Strategic Roadmap

(1) HCAP Partners collaborates with management teams to develop a tailored Strategic Roadmap which includes actionable steps to improve job quality standards over time.  This working document is subject to change. (2) Includes smoking cessation assistance, Get Fit competitions, nutrition coaching, flu shots, workout facility in the building

Cubex: Year 1 Progress Report

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