What Are Impact Ventures?
Impact Ventures are a next level challenge – they combine the requirement of financial viability (and often high-growth) with a values-based social impact that demands a positive outcome for people and planet. These impact ventures align with the UNSDGs and can come from a wide variety of sectors, including: Smart Cities, Edtech, Cleantech, Circular Economy, Industry 4.0, NuWork, Social Inclusion, Equality, Financial Inclusion, Waste Reduction, Interoperability and many, many more.
The Impact Venture Journey we have distilled from our time spent working with impact entrepreneurs, breaks down the steps to launching a successful project. It is broken down into seven steps.
1. Venture Synopsis
A strong ‘Venture Synopsis’ is a 2-3 page document that introduces your organization, highlighting why it is well-positioned to succeed. It outlines the problem your venture aims to solve and presents your proposed solution. The synopsis should briefly summarize any work completed so far, demonstrating progress. It also includes clear, SMART objectives (Specific, Measurable, Achievable, Relevant, and Time-bound) to outline the venture’s goals. Finally, it estimates the potential impact of a successful venture, showcasing the benefits and value it will bring.
2. Funding Options
There are several potential funding options available for your venture, and understanding which one best suits your project is the next step of the puzzle.
- Grant Funding – This includes various types such as Research & Innovation (R&I) Grants, Capital Grants, Knowledge Exchange Grants, and Business Support Grants.
- Loan Funding – Options here range from Traditional Loans, Crowd Lending, and Innovation Loans to specialized Impact Loans.
- Equity Investment – These include Angel Funding, Venture Capital (VC) Funding, Equity Crowdfunding, and Impact Investment.
- Support Funding – This category covers resources like Accelerators, Incubators, Coaching Programs, Intellectual Property Audits, and Market Research support.
3. Venture Strategy
A well-developed Venture Strategy builds upon the Venture Synopsis by adding key components that provide a deeper understanding of the venture’s potential.
First, Market Research should detail the size and characteristics of the target market, including the addressable market size and a clear understanding of target customers. This helps in identifying the opportunity and demand for the venture. Competitor Research is crucial, offering an analysis of the current state-of-the-art solutions and key competitors. This includes a quantified comparison of features and benefits, demonstrating how your venture differentiates itself from the competition.
Policy Alignment ensures that the venture is positioned within global, national, and regional priorities, identifying key stakeholders who may support or influence its success. A solid Business Model outlines how the venture will become self-sustaining, presenting the pricing or funding model and a high-level financial forecast. This helps in showing the financial viability and long-term sustainability of the venture.
The Team & Partners section highlights the skills and experience that will drive the venture’s success, including any strategic partners who can add value. The Intellectual Property component summarizes the current intellectual property rights (IPR) position and outlines potential areas for protection as the venture develops.
Finally, the Route to Market describes the marketing strategy, outlining how and when key commercial milestones, particularly the financial break-even point, will be achieved. This ensures a clear plan for scaling and profitability.
4. Funding Strategy
A sound Funding Strategy requires thorough research into various funding options to assess key factors.
These include Eligibility, determining if your venture meets the funder’s criteria; Timing, ensuring you understand application deadlines and decision processes; and Strategic Fit, evaluating how well the funding aligns with your venture’s goals.
Additionally, consider Restrictions, checking if the funding covers the major costs you’re targeting, and Conditions, understanding any requirements for match funding, equity, repayment, or guarantees.
5. Venture Plan
A Venture Plan provides the necessary details to execute the strategy effectively. It begins with a clear Business Model, outlining the pricing strategy or income generation plan. The Commercialisation Plan profiles target customers and maps out the route-to-market, ensuring that barriers to adoption or engagement are addressed. Additionally, an IPR Protection plan covers intellectual property, including patents, trademarks, design marks, and confidentiality measures, detailing how each will be managed.
The plan also addresses Project Impact, specifying key performance indicators (KPIs) related to finance, project outputs, and the expected impact on stakeholders. Project Management is laid out with an organogram, reporting structures, and defined roles and responsibilities. The Cost Plan breaks down expenses into categories and outlines cash flow, while the Work Plan organizes tasks into work packages with deliverables, milestones, and dependencies.
Furthermore, a Risk Register identifies potential technical, commercial, and management risks, along with mitigation strategies. The plan concludes with Team Profiles, showcasing the key personnel’s relevant skills and experience, and identifies Partners and Sub-contractors, detailing their roles in project delivery, operations, and ongoing activities.
6. Funding Applications
Depending on your funding strategy, compelling funding applications may take various formats, including Grant Applications, Pitch Decks or Investment Decks, a detailed Business Plan or Information Memorandum, a Crowdfunding Campaign, a Pitch Video, or Loan Applications.
Each format is tailored to suit different funding sources and audiences, ensuring your venture’s strengths and potential are communicated effectively.
7. Lift Off
The final thing to think about is what partners you might need as you continue to progress with this journey. This could include:
Engaging Legal Advisors to protect your intellectual property, secure partnerships, and maximize state aid opportunities. Attend Networking Events to meet potential customers, connect with funders, and gain expert insights. Leverage Technology solutions such as IoT, open-source data platforms, apps, and websites. Explore funding options from Funders including grants, impact investors, loan providers, CSR funds, tenders, and accelerators. Collaborate with Academic Experts from leading EU research teams, and partner with Developers in renewable energy, infrastructure, and utilities.
If you’ve reached this point it looks like you have everything in place. We wish you every success with your impact venture!
