Side Letter: On the indictment of TPG’s Bill McGlashan

Bill McGlashan is no longer at the helm of The Rise Fund. Here’s today's brief, for our valued subscribers only.

Just happened

Rise and fall

The indictment of TPG Growth founder and The Rise Fund chief executive William McGlashan Jr (pictured) is a blow to the nascent impact investing industry.

McGlashan is one of 32 parents indicted over their alleged participation in a US college entrance exam cheating scheme as well as a college recruitment scheme, according to an FBI affidavit. He is accused of agreeing to a $50,000 donation to a non-profit with the understanding that his son’s test answers would be corrected after the entrance exam. He’s also accused of conspiring to bribe an athletic director at the University of Southern California to facilitate his son’s admission as a recruited athlete – in this case as a football punter. The kicker? His son’s high school doesn’t even have a football team.

For impact investors, the news has echoes of Abraaj, an emerging markets PE firm that majored on its impact credentials and has subsequently been brought down by allegations of financial mismanagement.

While clearly very different, McGlashan’s indictment is another blow for the impact movement. The Rise Fund is the poster child for the institutionalisation of impact investing: it has raised more than any other firm for the strategy. McGlashan’s indictment will at the very least give fuel to the fire to the critics. And if you want to hear what critics will say, comments from Time Magazine editor-at-large Anand Giridharadas should give a good sense.


Love, actuary. Insurers could invest more heavily in private equity after the European Commission reduced the amount of capital they must set aside to manage the perceived risks for some long-term equities. Funds that meet certain criteria, such as being unleveraged, closed-ended and either a EuVECA, an EuSEF or an ELTIF, will now be given a 22 percent risk-weight, compared with the 39 percent or 49 percent as previously set by the Solvency II directive. The European insurance industry had more than €10 trillion invested in bonds, company shares and other assets in 2017, according to Insurance Europe data, and accounted for 8 percent of European private equity fundraising in 2017, per Invest Europe.

Fund of funds fight on. Despite periodic soundings of the death knell for their business models, fund of funds managers have found ways to adapt and thrive. In our latest downloadable presentation, we explore how these stalwarts of private markets will continue not only to stay relevant but to add value to their clients and the industry at large in the coming years.

Lessons from outer space. Ways in which the public and private sectors approach large-scale endeavours are not exactly light years apart, former NASA astronaut Garrett Reisman tells sister title Infrastructure Investor. Now at SpaceX, Reisman says risk management is an “equally strong motivation” for both sides, but how the public and private sectors perceive those risks differ. Government agencies tend to avoid change, but private companies view stagnation as dangerous. Speaking of danger, Reisman describes going on a spacewalk as a “sense of total immersion”; floating over the earth, “your life experiences melt away”.

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He said it

“We’re not talking about donating a building so a school’s more likely to take your son or daughter, we’re talking about deception and fraud: fake test scores, fake athletic credentials, fake photographs, bribed college officials.”

US Attorney for the district of Massachusetts Andrew Lelling describes the charges to a press conference on Tuesday.

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Today’s letter was prepared by Toby MitchenallIsobel MarkhamAlex LynnPreeti Singh and Jordan Stutts.