EPOCH Pi is an investment banking firm in Cleveland, Ohio that was founded on a sustainable innovation: purposeful investment banking. EPOCH offers investment financial services for purpose-driven, for-profit companies that generate positive impact and financial returns. They work to create "Partnerships for the Goals" by enabling companies to pursue solutions for the UN Sustainable Development Goals.
Case Western Reserve University - Weatherhead School of Management
EPOCH Pi focuses on supporting these purpose-driven companies while safeguarding the companies’ core values and missions. EPOCH Pi emerged through a partnership between Lynn Carpenter and William Vogelgesang, who both saw a need for a more socially conscious approach to investment banking. After a five-year incubation period in a predecessor firm, EPOCH Pi branched off in 2015 to focus exclusively on offering financial support to purposeful companies. In 2017, EPOCH Pi became the first financial services firm in Ohio to be recognized as a Certified B Corporation due to its commitment to social and environmental impact.
In our interview with Carpenter and Vogelgesang, they described to us the purpose behind their innovation. They identified a constant problem that purpose-driven companies encounter when investors get involved: they are often inviting people into the company with opposing interests that can impede the sustainable purpose of the company. According to Vogelgesang, “companies are very concerned about having ‘aligned investors’... people who are doing it for the same or similar reasons that they are.” EPOCH Pi aims to be those “aligned investors” for companies that create positive social impact. According to their website (epochpi.com), they offer traditional investment banking services (such as mergers and acquisitions, ESOP advisory, and capital raising) while creating an integration plan that protects companies’ fundamental ideals and ensures long-term success for people and profit. This approach extends to how they negotiate terms with clients. As Carpenter explains, “in investment banking, the model has been to get the highest price or the best terms, and not much else.” EPOCH negotiates with companies in a way that acknowledges the core values of the company, ensuring that financial returns do not come at the cost of these values.
The innovation behind EPOCH Pi was inspired by the ideals of “conscious capitalism.” In 2008, Vogelgesang was searching for books on philosophy when he stumbled upon an article by John Mackey, co-founder and CEO of Whole Foods Market, and co-founder of the Conscious Capitalism movement. This movement involves an economic and political philosophy that emphasizes how companies can operate ethically and serve all stakeholders while pursuing profit. Vogelgesang immediately shared the article with Carpenter, and they were both heavily impacted by these ideas. Carpenter described to us Vogelgesang's reaction and what he told Carpenter: “He read it, and he was like, ‘Wow, there’s another way of doing business and thinking about creating value. It’s not just financial value, it’s value for all stakeholders. Read this article and let me know what you think, but I am going to figure out how to incorporate this into what I do for the rest of my career.’”
From there, the two worked together to explore and experiment with the potential for this approach in the field of investment banking. Ultimately, with the idea of combining conscious capitalism with the UN Sustainable Development Goals, they decided to build out the infrastructure to help purpose-driven business owners that promote social impact and support all stakeholders. Thus, EPOCH Pi was born. According to epochpi.com, “EPOCH” comes from the idea that we are entering a new era or “epoch” they call the “purpose economy.” “Pi” comes from their innovation of “Purposeful Investing,” as well as the mathematical symbol representing the “circular and interconnected nature of life” that characterizes this new purpose economy.
After discussing the background and inspiration behind EPOCH, the conversation shifted towards the impact the business has on society. Vogelgesang began by explaining that while EPOCH is a relatively small investment bank, its size has never deterred them from creating an impactful and meaningful practice. One of their main goals as a business within a very capitalist industry is to help facilitate a much-needed change that will accommodate a more stakeholder-oriented approach. In doing so, they want to help businesses who have a similar philosophy that the overall purpose of business is more than just accumulating a profit, it’s to make a lasting impact on society.
And while this framework is rare within investment banking and private equity, Carpenter explains, “I think if we can be an example and we can be different, we can show there is a different way [referring to investment banking practices].” She continued to explain that despite this practice being quite rare, purposeful investment banking is slowly beginning to become more common within the industry. During the interview, it was mentioned that responsible banking as well as Environmental, Social, and Governance (ESG) criteria which are standards that socially conscious investors utilize to assess a company’s operations are starting to accelerate and become more prevalent. This reflects the idea that companies such as EPOCH are the footprint of the change happening within the field of investment banking.
As mentioned earlier, EPOCH is a certified B-Corporation, meaning it had to meet certain criteria to fulfill the requirements of the B-corp assessment test; which includes a company’s positive impact on its workers, customers, environment, and community. Becoming a B-corporation allowed them to be more conscious of their impact in those respective areas as well as be more deliberate during the hiring process, volunteering, customers, the environment, and just an overall better perspective on how to best manage a corporation in a meaningful way which aligned with their goals for their business.
Ultimately, Carpenter and Vogelgesang, “...started the business so the companies that have a higher purpose and a stakeholder approach, survive and thrive long-term, that their only option isn’t to sell out.” EPOCH wants to share their knowledge and advice so that these businesses can truly make the right transactions and form a structure that best suits the needs that will guide them to accomplish their end goals. As an investment banking corporation, EPOCH has an obligation to support their businesses, but in addition to that, they wanted the company to serve a richer purpose to have a lasting impact on society. Carpenter said it best, “If we can create more companies that care about their shareholders and exemplify it and live it, we all win. We all win.”
Lynn Carpenter, Partner
William Vogelgesang, Partner
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Cleveland, Ohio, US
Business Website: https://epochpi.com
Year Founded: 2015
Number of Employees: 2 to 10