Systemic Perspective. Entrepreneurial Focus.
July 13, 2016 marked Invanti’s first ever Founders Lab. Dustin and I shared a conference room with seven smart, curious, entrepreneurial ESTEEM master’s students, hungry to launch a start-up. One caveat: none of them had an idea yet. We were setting ourselves up to test a core part of our hypothesis — if we aim talented people at problems worth solving, they will find a problem to sink their teeth into and hunt for entrepreneurial opportunities.
Written on the white board were eleven problem areas identified by South Bend community leaders: vacant lots, loss of low-skill jobs, cost of daycare, data visualization, transportation, technology adherence and training, chronic health problems, process improvement, schools & pre-K, and hardware for the digital divide.
Fast-forward three weeks later, and we sat in the same conference room and watched them deliver problem pitches. Our pre-idea founders had transformed the words on the whiteboard into six distinct problem statements, identifying metrics, stakeholders, and systemic barriers to change. A few of them connected problem areas to topics they were already passionate about and the rest dove into something completely new. At this point, they have varying degrees of focus, but we think all are ripe with entrepreneurial opportunities. Here is where their problem definitions stand:
· Skills Gap — “Our next generation of workers fails to meet the industry’s demand for talented labor and the workers lack the skills to lead productive and prosperous lives.”
· Chronic Health — “Barriers to chronic health treatment.”
· Augmented Workforce — “How might we best leverage the qualities that make humans uniquely qualified for certain tasks given that increased automation is replacing low-skill jobs?”
· Digital Divide — “Bridging the gap between limited internet access and digital literacy.”
· Antibiotic Resistance — “Over prescription and misuse of antibiotics is driving an alarming increase in antibiotic resistance in the US, which is not being matched by R&D of new antibiotics.”
· Private Vacant Lots — “South Bend has an excess of private vacant lots, as well as a continuing influx.”
So, they’re digging in to some pretty cool (and pretty big!) problems. Now what? We’ve been doing a lot of thinking about the kind of ventures that create the impact we’re after. Specifically, how we can reverse-engineer their formation to help us understand what inputs we can give our founders as they’re refining their problem focus, finding opportunities, and building their ventures. Our aspirational ventures boil down to two key elements: 1) alignment of profit and impact and 2) systems thinking. Invanti will aim to create for-impact ventures that align financial returns and impact, as opposed to balancing them.
Vanessa Kirsch of New Profit does a nice job explaining why social ventures need systems thinking. We see a system venture as one that emerges from a deep understanding of stakeholders and incentives in the context of a problem area and aligns a series of customer segments and value propositions to optimize for financial and impact return. In Vanessa’s words, progress is possible when an entrepreneur “thinks about the system he was trying to change as a whole, not about a narrower entrepreneurial opportunity or technical challenge.” We think that starting with a problem instead of an idea makes our founders well positioned to approach their ventures from a systems thinking perspective.
Here are three ventures that we see as good examples of for-impact ventures that align profit and impact using a systems thinking foundation. The first two happen to be Acumen America’s first two investments.
· Syapse
In our problem pitches, we heard a few times that several stakeholders in a system have identified a shared problem, but the question of whose responsibility it is to act remains unanswered. We believe this is a symptom of a system ripe with opportunity for a for-impact entrepreneur and possibly a core part of what Invanti will become.
3 things we are looking for:
- Your feedback! On anything and everything you’ve read to this point
- People that might be interesting to meet in NYC (Dustin & Maria, Aug 19–21)
- People that might be interesting to meet in SF (Dustin, Aug. 29–31)
Avanti!
