For startups that want to save the world, or at least make it a better place, balancing impact and profit can be difficult.
“Investor and shareholder expectations are often misaligned with how difficult and intractable the problems we face as a society are,” said Co-Founder and CEO of Vibrant Planet. CEO Alison Wolf spoke on the Builders Stage at TechCrunch Disrupt 2024. In a way, we're a bit stuck. ”
But it's not impossible.
Wolff's company develops cloud-based software to model and respond to wildfire risk for utilities, insurance companies, and land managers such as the U.S. Forest Service. To ensure it upholds its mission, the company registered as a public benefit corporation, which requires companies to report on impact in addition to regular financial information.
“This is a sophisticated structure that you should consider if you haven’t already, and it’s easy to convert,” she said. “And doing the reporting side of that is a good feature that forces us to think through thoroughly every year and what impact are we having and how do we account for that?”
Another approach is to find technologies and business models that closely link purpose and profit. That's what Areeb Malik and his co-founders did when they launched Glacier, a robotic recycling company.
“When I started the company, I was looking for the right opportunity, and it was really about aligning profitability and impact,” he said on stage.
“For example, if I can find a place where I can make money at the same time as having a climate impact, which I am very passionate about, I would welcome a PE fund to come and take over my business. 'We'll get it for the money.' That money is directly correlated to climate impact. ”
But sticking to the mission isn't always enough, Hyuk-Jeen Suh, general partner at SkyRiver Ventures, told Disrupt. A mission means nothing if a company's reach remains limited.
“Many founders are so focused on building a widget that they only care about that one widget. They haven’t yet figured out how to build the foundation to scale,” he says. Said. “When you create a widget, you have to think about how you're going to mass-produce this. How are you going to sell this to a mass market?”
If all of this seems too difficult for your startup to juggle, Suh says it might be time to put the mission part aside until you've mastered the basics. Such ambition, he says, is actually proof that the company is on the right track. “They need to bite off more than they can chew, because I think without that boldness and vision, it’s hard to really make an impact.”