From Unicorns to Zebras. How can we stimulate sustainable (investment) business models?

By 24th May 2018Semi-finalists

24 april 2018, From Unicorns to Zebras.

Ideas from Europe shows that a growing number of entrepreneurs is working on innovation for a better world. These companies focus not only on profit, but also on societal impact. As one of the Ideas from Europe side-events, the European Commission’s DG for Internal Market, Industry, Entrepreneurship and SMEs and the Impact City of The Hague organised a workshop to explore how to stimulate the growth of business that aim to ‘do business and do good’. In particular, what is the changing role of investors who want to explore a more sustainable and responsible  growth models by building on the approaches already used in the impact investment field, in addition to searching solely for exponential growth companies.

The workshop brought together around 30 participants with very different backgrounds. The speakers were:

The Impact City of The Hague, who introduced their journey in developing an innovation and entrepreneurship programme reflecting their strength as international city of Peace and Justice. This resulted in the emergence of the Impact Economy programme and the ImpactCity community.

Then, ‘Zebras Unite’, a bottom-up global movement identified the emerging needs of businesses pursuing purpose as well as profit (and invited everyone to join zebrasunite.com!).

Finally, NLimpact and Sens Foods described investment challenges and opportunities from an investor and start-up business perspective. As an example of a changing investor perspective NLimpact assesses their investment not only in terms of profit, but also their contribution to the UN Sustainable Development Goals.

Inspired and enthused by the speakers, participants were then invited to work in small groups on what they considered opportunities and challenges for ‘zebras’ (a working name for companies that want to scale and do good) both financially as well as in terms of impact. And what could be done at European level to help this movement.

Some challenges identified were the impact on the balance sheet and where to start looking for (the right type of) funding. Impact investing is an immature market and perhaps too much modelled on mainstream VC practices. A longer term or ‘more patient’ capital is needed. A related challenge is how to put a ‘monetary value’ on ‘values’ that such companies exercise on all levels of their operations – from products or services offered through their value chains to reducing negative spill-overs from their operations. Creating a European corridor for soft landings and easier access to ecosystems when expanding to different countries were mentioned. How can government be acting as the first investor – what is the role for public procurement. The workshop’s outcome will feed into the Commission’s Start-up and Scale-up initiative and continued during the SME Assembly in Austria later this year. Let us know if you are interested!