Why impact matters to startups

Here we focus on the value that impactful business models bring to startups rather than impactful operations or profits because:

1. Due to scaling pathways in tech-enabled startups, this has the greatest potential for impact

2. Is most likely to be relevant (for many startups, operations/profits are too small to be meaningful)

By building a business model with impact at the core, startups derive benefits in four buckets:

1. Advantageous customer dynamics (e.g. lower CAC in targeting underserved groups)

2. Attracting, retaining and motivating top talent which are seeking more purposeful careers

3. Favourable risk profile (e.g. by staying ahead of regulatory action)

4. Increased attractiveness to investors as they begin to realise the value in responsible investing

BSC has written a series of blogs that capture our thinking here:

1. Overview

2. How impact mitigates startup risk

3. How impact can enhance customer retention

4. Unlocking pathways to scale and impact through innovative revenue models

There's some other sources which are also relevant:

1. Eka Venture's investment thesis highlights the 'shared value' behind impact and financial returns

2. The 'Impact Moat' published by Giant Leap VC