Partner Profile | High Divide Management

Written by: Julia Mazzola, Finance & Investment Associate

Earlier this year we announced the launch of Blue Forest Asset Management, an investment platform under the umbrella of Blue Forest with the goal of connecting investors to compelling, mission-aligned, private market investment opportunities beyond Forest Resilience Bonds. Along with the launch of this platform, we also announced the initial closing of the California Wildfire Innovation Fund, a private equity and private debt fund with a mandate to back California companies working in forest restoration, wood utilization, and wildfire mitigation.

While the fund’s thematic focus was familiar — Blue Forest has been deeply embedded in the California forest restoration space for years — this was the first time Blue Forest had employed the limited partnership fund structure ubiquitous in the private investing world. Such funds often take advantage of specialized firms to help with accounting, administration, and financial operations, and so Blue Forest started looking for the right partner to assist on our new fund. Enter High Divide Management.

High Divide Management (HDM) is a closely held, boutique fund administrator focused on building meaningful client relationships while providing a range of highly tailored fund administration and back office services. HDM’s Partners met while working in the PwC Assurance practice in Seattle, later branching off and gaining decades of collective experience in real estate, private debt, and fund administration for venture capital and private equity firms. As the private equity industry experienced rapid growth, the partners noticed that a subset of the market wasn’t being particularly well-served. Middle market and smaller funds, such as Blue Forest’s, were seeking more personalized fund administration services backed by strong institutional knowledge. The partners came together in 2020 and formed HDM to fill this gap.

“We saw this market segment as a great fit for ourselves. We were institutionally trained and classically trained, but also wanted to be working with folks that were small enough that we could form real, deep, meaningful relationships with them”, explained HDM Co-Founder and Managing Partner, Brad Smith. “Folks want to know who they are working with. They want consistent people, and they want to work with knowledgeable people, and that’s what we have been utterly focused on in founding High Divide.”

Since then, HDM has expanded to six team members, maintaining approximately $2 billion in assets under administration, and serving around 15 investment teams with 45 funds, including Blue Forest. Upon connecting with Blue Forest in June 2022 during our search, the mutual fit was clear. The HDM Partners and team members are conservationists, lifelong outdoors enthusiasts, and personally connected with the values and mission of Blue Forest. The company name “High Divide” is actually an homage to a popular hike in the Olympic National Park in Washington State, where many members of HDM had significant experiences and memories, enough so to name the company after it.

“We strongly believe in our collective responsibility of stewardship and taking care of our shared ecosystem. We could not be more thrilled to be working with the Blue Forest team on their mission, and look forward to sharing our expertise to help them efficiently and effectively meet their organizational goals”, voiced Smith.

As fund administrator and back office for the California Wildfire Innovation Fund, HDM fulfills a variety of critical roles, including maintaining the accounting books and investor records, arranging funds transfers to and from investors and portfolio companies, and reporting on fund investment outcomes. Ultimately, HDM expands and extends the capabilities of the Blue Forest finance and investing teams, helping us make and manage high-quality investments on behalf of our fund investors. Over the long term, HDM will continue to advise Blue Forest on best practices as the Blue Forest Asset Management platform grows.

“The thing that makes Blue Forest special to us is getting to focus on a project that we believe so much in. I mean, so often, asset management is just taking a pile of money and helping it grow. But having an opportunity to really dive into a mission and work with people who are mission-aligned like Blue Forest,” commented Smith, “I think that’s what we find most exciting. Fund administration just happens to be the service we provide and the hat we are wearing. But the underlying cause is the fun part, right?”