HCAP Partners’ Impact Thesis

HCAP Partners provides mezzanine debt, private equity, and technical assistance for underserved businesses to drive operational excellence, quality job creation, and economic opportunity for women, people of color, and low- to moderate-income (LMI) workers.

Our impact thesis summarizes the positive impacts we seek to achieve through our capital and our approach to value creation. An impact thesis illustrates an investor’s hypothesis for how its actions positively contribute to a set of social outcomes.  

Our impact thesis is organized as a logic model that can be read from left to right. It describes (1) the job quality challenges in the U.S., particularly among low-wage workers, women, and people of color, (2) how we contribute to addressing these challenges in partnership with our portfolio companies, including through the Gainful Jobs Approach™, and (3) the associated positive societal outcomes that we hope to achieve together as identified by the United Nations Sustainable Development Goals.

Challenge

• 50.5 million Americans reside in distressed communities and a majority of distressed zip codes lost businesses and jobs⁶
• 44% of the U.S. workforce
  are low-wage workers with fewer opportunities for upward mobility
  
  Women and Black workers are overrepresented in low-wage jobs⁷
  
  Hispanic and Black women have the lowest shares of upward transitions: 37% and 43%, respectively⁸
• 40% of American
  workers experienced
  worsening job quality since the start of the COVID-19 pandemic⁹
• Social and economic inequities across race, ethnicity, and gender are exacerbated by low job quality, hindering economic opportunity¹⁰

HCAP Contribution

• Capital and value creation activities
  
  ＋ Mezzanine debt and private equity tailored to business needs
  
  ＋ Strategic support, engagement, and value-added resources
• The Gainful Jobs Approach^TM
  
  ＋ Quantitative measurement system to assess job quality
  
  ＋ Hands-on engagement with leadership and management to improve job quality
  
  ＋ Access to HR guidance, tools, resources, and technical assistance to support job quality improvements
  
  ＋ Sharing of data, evidence, expertise, and lessons learned to support investors, employers, and government in creating quality jobs

Impact

• Outputs
  
  ＋ Greater access to capital for underserved businesses, particularly those led by women and people of color
  
  ＋ Increased wages for frontline workers
  
  ＋ Increased access to 401(k), ESOPs, and profit sharing
  
  ＋ Increased access to healthcare and wellness benefits
  
  ＋ Increased workplace satisfaction
  
  ＋ Reduced turnover
  
  ＋ Greater pay equity
  
  ＋ Increased women and people of color in leadership
• Outcomes
  
  ＋ Targeted societal outcomes as identified by the United Nations Sustainable Development Goals

Criteria for Each Attribute of the Gainful Jobs Approach™

The following table outlines the specific criteria for each of the six attributes of the Gainful Jobs Approach™. According to the revised 2023 methodology, an employee has a quality job if four or more of the key attributes of the Gainful Jobs Approach™ are present*.