Novata Closes $30 Million Series B

NEW YORK — Novata, a technology platform and public benefit corporation that provides the private markets with a cutting-edge Environmental, Social and Corporate Governance (ESG) solution, has announced a Series B funding round with $30 million. This significant capital raise enables Novata to meet the private markets’ critical need for a simple and secure data management and analytics platform to enable investors to align their capital flows with the metrics that matters to them.

Hamilton Lane led the funding round, with participation from existing investors – the Ford Foundation, S&P Global and Novata’s founders. The company is also announcing that Microsoft  has joined the investor consortium through its Climate Innovation Fund. In addition, partners and managing directors from a range of private equity firms participated in the Series B, including Canson Capital Partners, Clearlake Capital, Hellman & Friedman, Kohlberg & Company, Lindsay Goldberg and The Vistria Group.

“We are grateful to the broad range of leading investors supporting Novata, including financial institutions, large technology companies, non-profit organizations and private equity firms, which underscores how major facets of global economic activity are coming together to address our most critical common challenges,” said Alex Friedman, CEO & Co-Founder at Novata. “As sustainability priorities have undisputedly changed over the last decade, Novata is ideally positioned to meet the evolving challenges and to help drive progress on ESG transparency and reliability in the private markets.”

Since its successful commercial launch in April 2022, Novata has experienced significant global demand and today has more than 3,500 private companies contracted to use the platform. Novata launched its unique benchmarking capabilities in November 2022, enabling clients to compare key non-financial data against public and private market industry averages and identify opportunities for improvement. Novata’s broad-reaching analytical tools are a market differentiator, offering an unprecedented view of ESG performance in private markets by providing clients with access to anonymized and reliable data from thousands of companies in its contributory database.

“We consider Novata to be the critical infrastructure needed to accelerate sustainability and strong governance in the private markets,” said Erik Hirsch, Vice Chairman and Head of Strategic Initiatives at Hamilton Lane. “As our industry continues to grow, we all face increasing expectations from investors, regulators, and the broader society to ensure that strong investment performance is delivered alongside responsible business practices. Novata is exactly the kind of neutral intermediary the private markets ecosystem needs to collect the metrics that matter and put them in context.”

Novata’s simple, customized and partner-agnostic offering represents a major step forward in the current landscape of sustainability tools and metrics. The Novata solution takes a much-needed systems-wide approach in the private markets, bringing together the non-profit and for-profit sectors to help drive impact toward sustainable and inclusive capitalism.