Many investors are attracted to entrepreneurs who can project huge profits. Investors will also sign a check if an entrepreneur has a novel idea. 50% of my day is spent with startups investors. I have witnessed many different reasons for investors to invest in startup companies. One fact entrepreneurs don’t know is that investors are increasingly interested in startups that focus on impact.
Many investors are now interested in investing in impact to realize the full potential of their capital. Impact investments can be used to create positive, sustainable social and environmental effects in addition to returns. The market value of impact investments is estimated at $715 billion by the 2020 Annual Investor Survey from GIIN.
Are you an impact-preneur?
Impact-preneurs refer to entrepreneurs who are dedicated to solving large-scale problems in the social and environmental realms. They create business models that are sustainable and serve a social or ecological purpose while still being profitable. It is essential to reach a broad and underprivileged audience. Although it may seem that the needy are poor, they offer a wealth of opportunities for long-term players.
Identifying an industry with the potential to create impact
A few sectors that have made an enormous impact globally include education, health, and microfinance. But it is not appropriate to link effect with one industry or sector. You can have an impact-driven startup if your product solves a significant social problem.
Scalability is the most sought-after term for investors. But, scaling with a social purpose is the cherry on top.
After all, we can’t eat food.
Many entrepreneurs are forced to think about their vision of their startup during these challenging times. Many entrepreneurs have realized that it doesn’t suffice to be in a market where the product is affordable. It is essential to remain relevant in a call even when money is not available. Impact investing is characterized by impact-driven startups that measure their performance. It is no surprise that the performance of impact-driven startups is measured by the region’s impact and the amount of profit. This measurement opens new avenues to innovate and address social or environmental issues holistically.
Entrepreneurship is essential for the future of our world. Social entrepreneurs will be tomorrow’s heroes if they are dedicated to a cause. Social entrepreneurs will be the foundation on which the emerging stability of the economies can rest. That’s what investors are betting upon.