The need for a new type of Venturing

Open Venturing

We are in a new reality, and need a new type of venturing….

How we build start-ups, scale inventions and innovation is rapidly changing and we need to adapt our modes of venturing and acceleration to a new reality.

Our new socio-economic reality is asking for a new type of venturing. One that firstly needs to take account of, synthesise, and strategically make the most of 3 Ss:

Societal Good. The creation of societal good will increasingly be a prerequisite for a 21st century corporate license to operate, rather than a discretionary option. This future is already becoming evident with a growing enthusiasm for new corporate legal forms such as the CIC and B Corps, policy driven change such as the Social Value Act in the UK and the new CSR act in India (requiring major corporates to “invest” 2% of net profits into CSR activities annually) and in the rise of citizen driven movements such as UK Uncut challenging corporates to prove that they have social licence to operate.

Social Behaviour. New organisational technologies like twitter, CrowdCube, open corporates, duedil, loomio, Basecamp and the cultures they fuel of collaboration, organisation and communication are driving a shift in the operating software of 21st century social ventures — enabling them to harness the potential of social behaviour and take the best account of it within venture building and design.

System Building. Opportunities and challenges are increasingly complex, and interventions can no longer simply take the shape of a singular product or service but need to focus on system building, as our advisory board member Marc Ventresca puts it in his TEDx talk. This involves driving shifts in regulations, supply chains, outcome metrics, taxonomy building communities of participants — this is the truth of the iPhone or the Trillion Fund.

So 21st century ventures will need to be social impact driven, social in their operating culture and “software” and system orientated in their innovations and interventions. Yet these strategic features of 21st venturing will also require new systemic characteristics — of being both radically open and long financed. By “open” we mean a new approach to radical transparency but also embracing the potential of open source and open innovation methods. This openness will not only drive and embed enlightened self governance by ventures but also lay the foundations for a strong fundamental architecture of collaboration and societal trust.

We are already seeing these structural characteristic from (and led by) starts up and ventures:

• Buffer driving transparency in employee pay
• Creative Commons Licences creating a whole new gradient of Open Intellectual Property
• Open Corporates pushing data-driven insitutional transparency into the corporate world
• Linux powering the most used software in the world
• GitHub creating a platform for reputation driven open collaboration
• Arduino creating an Open Source platform for Electronics
• Open Source Ecology — building a range of open source farm machinery
• The Wikihouse building an Open Source locally printable house. To list to list but a few ..

This radical transparency and systemic openness is made plausible by a machine readable and data rich world. Or as Jeremy Rifkin puts it in “A Zero Marginal Cost society” — the Internet and cloud is rewriting the rules of organisation.

Furthermore, we need to evolve our models of capital allocation and move beyond commercial venture capital and its unconsidered adoption into, and by, the sector. There is building a new mode of venture capital — one which is focused not on mere paper valuations but rather the alignment of capital to the returns of interventions and the mission behind them. In my view we need “long” capital not focused on equity but participation — and agnostic to the corporate form — be it charity, cic, ltd or Industrial Provident Society.

Any accelerator fit for purpose in the 21st century will need to embrace this new venturing reality. Since our beta phase to now we have been learning and evolving, with this mission, and the work of others — such as Jo Hill and her design of the Big Venture challenge, Ross Baird and Village Capital, Nigel Kershaw and Big Issue Invest, Paul Graham from Y Combinator, Stephen Rockman (to name but a few) inspiring us.

Working with, and embracing, this new reality underpins our core mission and is the challenge for us and to the founders we work with. We invite you to evaluate us on this basis, and will continue to to evolve and share our journey, and that of our founders, with you.

Indy Johar — Co Founder Hub Engine www.hubEng.in