Masawa Minute 46
Maximize your organizational health! | It’s time to redefine productivity | + More!
This is the Masawa Minute — mental wellness, social impact, and impact investing snippets from what we’ve read the last two weeks + where you can get active.
This week, we’ve been reading a lot about maximizing impact — from achieving the biggest possible social impact with your investments to redefining productivity in order to achieve the best results at work. Cheers!
Masawa Thoughts
Maximize your impact! Easier said than done; it doesn’t just happen overnight, and it’s never linear. We have three direct ways that you can start maximizing your impact this week:
- Nurture Your Capital: Maximize your impact by nurturing your capital. By focusing on the human factor, the internal impact of org health, and the external impact of societal health, you can drive greater financial and social returns! Not sure how to do that? Take a look at the Nurture Capital Thought Starter + reach out, we’d be happy to point you in the right direction. All aboard!
- CU*i x Masawa: Maximize your impact by maximizing your organizational health. The CU*i x Masawa learning journey that helps improve your org health and resilience through self-inquiry and deep dialogue. Check out this quick snippet with Stefan Kleineikenscheidt, founder of the tech firm K15t, about how his organization has already greatly benefited from the journey! There is one final teaser session on 5 October for the CU*i x Masawa program. See you there!
- Building for Mental Wellness: A Case for Mindful Cities: Maximize your impact by exploring the intersectionality between uncommon areas. In the last Masawa Minute, we shared the final part of our deep dive series looking into building better cities that prioritize wellbeing. Whether you haven’t read the articles yet or if you’d like to read them again (we wouldn’t be surprised!), now you can find the whole thing in one place. Enjoy!
Attend!
Next Normal Now: Re-Imagining Capitalism For Our Future
The GIIN’s Next Normal Now is a new series of virtual events designed to discuss systematic changes taking place right now, engage with leaders working to disrupt the status quo, and reimagine the future together. It’s the place for anyone seeking vital insights about what the “next normal” might look like, impact investors looking for practical tools and new ideas around innovative investments, as well as impact-curious people who want to learn more about how they can do more good with their capital. The first session on regeneration will take place on October 27th. Mark your calendars now!
What we’re reading…
📓 What impact founders often overlook — and how to avoid it
In 2021, impact investing and social entrepreneurship are becoming the norm. Well, if not the norm, at least significantly more common than they were a few years ago. There’s even statistical proof — according to gener8tor’s Social Impact Investor Report for 2021, more than 60% of early-stage entrepreneurs in the US stated creating a positive impact was the reason for starting the business. In 2020, $286 billion in assets could be attributed to the social impact category and the number is likely to rise for 2021, as consumers around the world choose to support businesses that contribute to positive change. However, for founders focused on the day-to-day of maintaining a business, it can be easy to lose sight of what sets them apart as a social impact enterprise. Luckily, this situation is not inevitable — there are three specific areas they should focus on to avoid this.
To begin with, social impact startup founders have to maintain the balance between the financial and impact sides of the company. For such startups, both of these sides of their business are equally important. When focusing exclusively on the financial side, founders miss out on the opportunities to facilitate significant social change. When focusing solely on impact, founders run the risk of diminishing business growth and losing the interest of investors, and with that, sacrificing greater impact in the long run. Speaking of impact, founders also have to be intentional about impact monitoring and measurement. While to them their impact goals might seem obvious, it’s essential to have a plan for being able to demonstrate measurable impact results. Without it, there’s a likelihood that impact investors will choose other companies that are able to provide this information, as well as a risk of unintentionally creating a negative impact in the future.
Impact founders should also be strategic in choosing their sources of funding. While it’s important to identify mission-aligned investors, that shouldn’t be the only thing to focus on. It’s necessary to be able to communicate the vision clearly to any investor, even (or especially) one that doesn’t have extensive knowledge about the field, to get people to understand the startup. Not to mention that impact investors, even if compelled by the mission, will still be looking to make investments that generate returns. And this goes both ways — a mission-driven company is still a business that needs measurable outcomes and earning potential to survive. Therefore as a social impact startup, it’s worth considering not ruling out traditional, non-impact focused investors too.
3 Common Mistakes Social Impact Founders Make
📣 Can sustainable investment exist without advocacy?
Traditionally, impact investing, socially responsible investing, ESG investing, and so on, operate on the assumption of “win-win” — they’re grounded in the idea that it’s possible to achieve social and environmental impact and financial returns simultaneously. An argument can be raised, however, that the current regulatory framework isn’t able to support the level of investment needed to tackle the most significant environmental and social challenges we face. One example is the fact that businesses would have to undergo losses of approximately $10 trillion by 2030 to meet the Paris Agreement global warming target of 1.5 degrees without a supportive regulatory framework in place. So what can be done? One solution might be pursuing the win-win investment model along with the trade-off — being willing to accept below-market returns or investing a portion of the revenue in advocacy targeted at changing economic regulations.
It’s important to note that all this isn’t to say that sustainable investment isn’t worth pursuing — while it might encounter limited scaling prospects due to unsupportive regulatory frameworks, it still does plenty of good. Next to that, the trade-off investments (accepting below-market-rate returns) also don’t come without problems. When a firm accepts lower returns and makes up for the difference in social impact outcomes — which are based on assumptions and framing effects — judging performance accurately becomes complicated. Just as investors can turn ordinary commercial investments into a win-win situation by using greenwashing, so can they make poor investment decisions look like good trade-offs. Also, at the economy level, trade-off investment faces the same problem of scale as the win-win investment does.
If trade-off investment isn’t the answer, we should take a look at advocacy. It seems like the only way to truly turn our economy around is to make addressing social and environmental problems profitable — that can be done by, for instance, putting a significant price on carbon emissions, which would reduce the returns on all carbon-intensive activities and make investing in low-carbon or carbon-capturing solutions worthwhile. This would unlock investment at scale and close the $10 trillion gap by making the necessary investments generate substantial returns. In order for such a scenario to become reality, businesses can use their voices to advocate for regulatory changes and invest in advocacy. When done right, it also has commercial benefits — companies that demonstrate their commitment to social and environmental issues through advocacy usually attract quality candidates, more customers, and more investors. And sharing advocacy cost with like-minded investors keeps the individual cost rather low.
Keeping this in mind, it’s possible to put together a general strategy by which investors can contribute to positive change at the necessary scale. By contributing a percentage of management fees to advocacy, impact investors can get exactly what they want: meaningful impact and full commercial returns. There are two ways to approach it: the more straightforward one is treating advocacy investments as a substitute for marketing expenses. It carries no costs or risks for clients, it’s easy to scale, and early movers can gain significant attention and capital flows from the impact investor community. The second approach is more sophisticated: it suggests tightly integrating investment and advocacy strategies, with the goal of generating above-market returns. The integrated approach is harder to scale because it requires local political knowledge, but the returns can exceed expectations. Taking the advocacy route might be the best option for businesses and investors to deliver a “win” both for themselves and society. So it looks like a win-win investment strategy (accompanied by advocacy) might be our answer for a better future after all!
Why Sustainable Investment Means Investing in Advocacy
🌿 The new leaders of holistic mental health care
As we know, during these tense times, therapists and psychiatrists struggle to keep up with the ever-increasing demand. To speed things along, there are some psychiatrists out there that can be too quick to dole out the medicine to treat a patient’s issues without properly examining existing alternatives. Luckily, some companies are working to tackle a range of problems associated with receiving quality mental health care and there is a new one deserving our attention — it’s Meru Health. The company, bringing a comprehensive online mental health solution to the market, grew its customer base by 10x and saw about 700% revenue growth in 2020. And now it announced securing $38 million in a Series B round of funding, which bumped up its total raised amount to $51.3 million. The equity round was led by Industry Ventures, while the rest of the sum was secured in debt.
For the first few years of the company, Kristian Ranta, Meru Health’s founder, focused mostly on research in order to thoroughly examine how well digital therapy and “old school” psychiatry was working. One of the conclusions the team arrived at was that “digital is great, but without the human touch, it’s not going to get utilization”. In other words, app-based solutions didn’t seem like the way to go when treating depression, anxiety, burnout, and similar problems — without accountability and human connection, it’s much harder to keep people engaged and therefore they end up quitting the treatment. Today Meru Health partners with employers such as Stanford University, Fortune 100 and 500 companies, employee assistance programs, and healthcare payers. The online mental healthcare provider is able to attract the companies by proving that the benefits offered by the program outweigh the costs — specifically, the estimated cost savings for an employer are as high as $6000 per enrolled participant. That is mostly due to high healthcare costs and lost worker productivity as a result of untreated anxiety and depression.
One thing that makes the company stand out is the holistic approach — treating both the mind and the body simultaneously, rather than focusing on one thing. Besides classic mental health-targeted solutions, such as talk therapy, Meru Health helps the patients to get better sleep and offers nutritional coaching because it recognizes that quality sleep, nutrition, and mental health are closely connected. This approach seems to be resonating with people, as the company mentions its plans to expand its nationwide network to 40 states by the end of the year. It also continues to work on clinical trials and doesn’t plan to deviate from the scientific approach anytime soon. According to Ranta, their research shows their solutions to be 3–5 times more effective than the standard care in the US with a roughly 80% completion rate, compared to that of 30–50% for traditional therapy. Meru Health stands out from the other companies in many ways, demonstrating exceptionally high engagement and completion rates, impressive clinical outcomes backed by data of long-term clinical studies. We can’t wait to see what their journey looks like next!
Meru Health secures $38M in equity and debt for ‘holistic’ online mental health platform
✍️ Redefining productivity to help people thrive
The boundary between life and work has never been a clear one, but with the beginning of the pandemic, it became next to invisible. We experienced one of the greatest disruptions to work experienced in generations, and that gave us a reason to rethink productivity once again. At the moment, it’s almost impossible to predict what work will look like months or years from now, despite extensive research. People, while missing many things about work “in person”, are scared of losing the flexibility that remote work offers — a so-called “hybrid paradox”. What research does know, however, is that the managers need to create a new definition of productivity that takes the hybrid paradox into consideration — one that values not only how much people get done, but also pays attention to how they work when the line between work and home no longer exists.
Numerous studies have demonstrated that the simple definition of productivity isn’t enough for us to move to hybrid work successfully. The new definition of productivity has to focus on wellbeing, social connections, and collaboration. Despite many of us being burnt out, the hybrid environment presents an opportunity to create a more sustainable approach to work, as it allows us to make use of the best of both worlds. When working from home, we can consider other priorities, like family, fitness, or hobbies. When in office, we can focus on building relationships and engaging in collaborative work. Collaboration and social connections are among the biggest reasons why people want to return to the office, yet if someone comes in and the rest of the team is working from home, these expectations won’t be fulfilled. Therefore a key aspect and a generally big theme in making hybrid work productive is finding a compromise between individual life and work styles, as well as what works well for each individual. Some time ago, coordinating team collaboration around individual work styles and thinking hard about whether your team’s meeting practices are the most optimal might’ve felt redundant. In these times and with the new definition of productivity, however, it’s nothing less than essential.
Innovation requires people to get together to exchange thoughts and brainstorm solutions, balanced with time for individual reflection. Hybrid work can offer exactly that — if done right. Therefore thinking of productivity in a wider sense — optimizing the conditions to stimulate innovation — might be the way to go in order to successfully transition to a “new normal” workplace. It’s essential to consider what work can be done remotely versus in-person. Remote work is great for individual and routine tasks, while tasks that depend on other people, as well as creative tasks, benefit largely from in-person collaboration. Meeting new people in person can also be important — it can encourage fundamental social connections that create innovation and also come in handy during the remote work that follows. In the end, the goal is to make work better than it was before by helping people thrive and achieve their goals all while supporting their wellbeing, collaboration, and innovation. The time for stressful, damaging, traditional productivity-focused workplaces is up. Let’s welcome the new era!
Let’s Redefine “Productivity” for the Hybrid Era
🕊 An economy that serves wellbeing
The last 1.5 years brought us many teaching moments, but among the most important lessons learned were those about how fragile and interconnected our economic systems really are. Decades of pursuing efficiency and higher returns came at the expense of
resilience in many sectors. Not to mention it becoming glaringly obvious that without professional caretakers, teachers, and many other generally unappreciated professions the economy would have struggled a lot more, if not collapsed completely. This reveals a fundamental contradiction of our systems — without the social foundation of care work, a neoliberal economy optimized for efficiency wouldn’t be able to function. That’s because the principles of care work radically differ from the principles of our competitive society. Care work is for the common good, spontaneous, and direct, rooted in empathy and willingness to connect with others. This observation is a good starting point for imagining a new system that centers the essence of care work itself.
So what could the alternative structures look like? In 1986, the American historian James Carse described society as consisting of two kinds of games: “A finite game is played for the purpose of winning, an infinite game for the purpose of continuing the play.” If we apply this to our very own economy, it becomes clear that its negative externalities act against the goal of playing the game as long as possible. As the care economy and our natural ecosystem are the foundations on which the free market economy thrives, the rules of a new structure should consider this and make sure they’re strengthened and protected. Luckily, several types of economies fitting this description have emerged throughout the past years — one example is the economy of the common good. It makes the wellbeing of people and the planet a priority and, under such an economy, the businesses exist to serve people’s needs. Moreover, the way to enforce it is quite straightforward — next to the corporate profit, the company’s success would be measured by the Common Good Balance framework. It wouldn’t be just another greenwashing report — the Common Good Balance would become the main balance sheet of the company with real consequences for the companies’ contribution to the common good. Companies that score high, for example, would get to pay lower corporate income tax, get cheaper loans, or receive property in public procurement.
Until now, about 2000 companies and 7000 people have joined this movement, advancing the approach in over 20 countries in Europe and South America. At an economic level, they’re attracting the companies and helping them draw up their first Common Good Balance sheet. On the political level, they’re talking to decision-makers in order to develop a legal framework. A lot of interest comes from local authorities such as municipalities, as they struggle to keep up with the global competition between cities, and their community activities usually lead to strong identification with the common good. The pandemic has pushed us to take a critical look at how our economic system functions, and encouraged us to think big in terms of the solutions. This is just one of the many possible examples of an economy that includes and serves everyone. It’s up to us to transform the potential for change into routines and lasting structures.
Gabija works as a Marketing & Communications Coordinator at Masawa. She lets her vision of a more just, sustainable, equitable world guide Masawa’s story and inform the work towards transforming global mental wellness to make it accessible and accepted.
