In a world where corporate greed and corruption have become commonplace, companies that also improve society are portrayed as the unicorns of business. As the program manager of Impact Engine, an accelerator that supports for-profit businesses addressing today's societal and environmental challenges, I get to see firsthand that impact companies are not, in fact, mythical creatures. Instead, they are real businesses making a real difference throughout the world.
Our first accelerator program launched in September 2012 with a class of eight smart and innovative startups creating viable solutions to some pressing problems, from building an education platform that teaches Common Core State Standards to developing biodegradable feminine hygiene products for women in rural India. It is our vision is that businesses that contribute back to society will eventually outnumber businesses that continually take from it. If you're skeptical about the role the private sector can play in improving society, here are five convincing reasons to build a business that changes the world:
1. Because Use and Access to Technology Is at an All-Time High
The proliferation of easily available and affordable technologies is democratizing the world of innovation. And we should be harnessing this innovation for good. Emerging technologies are no longer reserved for the wealthy or professional institutions. The World Bank's Maximizing Mobile report revealed last year that 75 percent of the world has access to a mobile phone. This report also showed that the use of mobile phones in developing countries has surpassed that of developed countries, and this is having positive effects on agriculture, entrepreneurship, health, and finance.
What's more, this technological growth is expanding beyond the traditional tech space to manufacturing and life sciences. Just last month, NASA awarded a $125,000 grant to Systems & Materials Research Corporation to prototype a 3D food printer, which could be used to end world hunger and food waste. In addition, DIYbio hack spaces, such as BioCurious in Silicon Valley and HiveBio in Seattle, are making synthetic biology readily available to non-scientists, and the implications of this could be huge.
2. Because You'll be More Competitive in 10 Years
Aside from the societal and environmental benefits impact companies can have on the world, these measures can also improve a company's bottom line. If done appropriately, fair and sustainable practices make businesses more efficient, reduce costs, and attract the attention of customers. Earlier this year, MIT Sloan Management Review and the Boston Consulting Group surveyed 2,600 business leaders on sustainability and found that the number of companies that profited from practicing sustainability jumped from 23 percent to 37 percent in the last year.
Perhaps the most notable and long-lasting example of this is the story of Interface Carpets. After founder Ray Anderson read The Ecology of Commerce nearly 20 years ago, he made a commitment to zero waste and emissions by the year 2020. To achieve this goal, Interface reclaims old carpets to use as raw materials and puts pressure on vendors to develop recyclable and non-toxic products, in addition to other sustainable initiatives. Twelve years after implementing "Mission Zero," Interface reduced its net greenhouse gas emissions by 82 percent while increasing profits by 50 percent.
3. Because We Have To
Between climate change, income inequality, and a dwindling education system, our world is facing some serious problems. We no longer have the option of sitting back while governments and nonprofits try to fix the mess. Public-sector resources are far too limited, and there's too much at stake. In fact, The Regeneration Roadmap, a project conducted by GlobeScan and SustainAbility, found that there lacks sufficient trust in government to create widespread societal and environmental change. Building up and investing in impact companies is one solution to this problem. Through impact organizations like Warby Parker, Embrace and d.light, we've seen what can be accomplished when public and private sector organizations work in tandem to create jobs and services for the world's underserved markets.
4. Because Investors are Game (When the Right Opportunity Comes Along)
When we launched Impact Engine, investors told us that they were interested in mission-focused businesses but felt like a limited number of profitable opportunities existed. So our goal was to find and mentor startups that had a positive impact on society and were attractive to investors. To date, five out of eight of our graduates from our first class have raised $2.5 million in seed funding from both angel and institutional investors. While this is a relatively small indicator, it shows that investors are interested in impact companies if presented with the right opportunity. This sentiment was echoed in a recent Q&A with Omidyar's Todor Tashev. Additionally, a J.P. Morgan and the Global Impact Investing Network survey of nearly 100 impact investors showed that investors planned to commit $9 billion to impact investing this year, up from $8 billion last year. For this commitment to grow, we need more people to take a risk by building world-changing, profitable businesses.
5. Because Having a Purpose Is Fun
Nobody wants to work for the man. In fact, research shows that a company's social impact initiatives are a key driver when deciding where to work. Ask yourself: What could be more professionally rewarding than building or working for a company that's impacting lives in a positive way?
To learn more about Impact Engine's accelerator program and how it helps entrepreneurs build businesses that change the world, visitTheImpactEngine.com/Program.