Impact measurement for your WorkerTech start-up
This post aims to give guidance to tech-for-good start-ups on how to think about and measure impact at the early stages, particularly for WorkerTech ventures.
What is impact measurement?
Impact measurement is about demonstrating that your start-up is making the change in the world that you intended it to. Measuring your impact from early on in your venture journey will help you to understand how your business is creating change, and give you the ability to demonstrate this to customers and investors.
It’s also a key question you’ll need to answer when you make your application to BGV’s Tech for Good programme.
In this blog we explore a how to think about impact measurement when launching a WorkerTech venture. There is no one right way to do it, and no silver bullet to understanding the impact you are having. But a good application of some of the frameworks, tools and resources below will set you up to build a solid impact measurement strategy that can grow with your venture.
Before we dive in, here are a few guiding principles:
- Impact should be baked in to your business model. By this, we mean that selling your product will undoubtedly lead to impact, and as your venture grows, the scale of impact of it on the world of work grows in lockstep too.
- Different startup stages require different types of impact measurement. For example, one of our WorkerTech portfolio, CareerEar, is measuring product user numbers at the moment. With growth they will also conduct surveys with users to see how much their confidence has changed since using the product.
- Don’t forget unintended impact too. Considering the adverse consequences your startup might have will help you to minimise risk and maximise positive impact.
Tools and resources
Sustainable Development Goals
The UN’s Sustainable Development Goals (SDGs) are a good starting point for identifying the different areas of impact, and the metrics associated with each.
They consist of 17 goals which, if achieved, will move us toward a more sustainable, equitable, healthy and productive planet. There are four goals that are most relevant to WorkerTech:
- SDG 4 — quality education
- SDG 5 — gender equality
- SDG 8 — decent work and economic growth
- SDG 10 — reduced inequalities
Each SDG is underpinned by a number of indicators that will demonstrate progress on that goal. For example, SDG 8 — decent work and economic growth — has indicators associated with average hourly earnings, female labour market participation, and unemployment rates. The SDG Compass is a useful tool that helps companies align their strategies and measure their contribution to SDGs.
While the SDGs can be a good place to start thinking about impact goals and metrics, they are by no means a panacea for all the change we need to see in the world. They lack mention or metrics for many marginalised groups, such as the LGBTQ+ community, and care needs to taken when applying them to different economic contexts. For this reason, consider the other frameworks you could use alongside the SDGs to build your impact strategy. A particularly relevant framework for WorkerTech ventures is the Measuring Good Work report, which followed on from the UK’s 2017 Taylor Review of modern working practices.
Theory of Change
Perhaps the most well-known tool in the impact measurement world is a Theory of Change — a way of describing how a particular way of working will create change in the short, medium and long term, to ultimately achieve your intended impact.
A Theory of Change usually includes these sequenced components:
An essential part of a Theory of Change is identifying the assumptions you are making about the route to impact. Working out these assumptions at an early stage can help you think about the parts of your venture that might not work, be difficult to understand, or be heavily influenced by external factors.
New Philanthropy Capital has a great guide to building your own Theory of Change and Nesta has a useful toolkit designed to help you identify your assumptions each step of the way.
Standards of evidence
Originally developed by Nesta, the Standards of Evidence set out five levels of impact measurement for new ideas. Starting with Theory of Change, the levels move through more and more complex evaluation techniques, scaling with the stage of development, until you reach a system of manuals and procedures to ensure consistent replication of your idea and a positive impact.
As you move from developing an idea for a WorkerTech startup, to building a prototype, to scaling, you should think about what processes you need in place to be able to move through the levels. This will allow you to demonstrate your impact to users, customers and investors and ensure that impact is growing in lockstep with your user base.
Impact Management Project
Through a series of conversations with thousands of impact practitioners, the team at the Impact Management Project (IMP) came up with five dimensions of impact that founders can use the evaluate the effect that their start-up has:
- What — what outcome is occurring?
- Who — who is experiencing the outcome?
- How much — at what scale, depth and duration is the outcome occurring?
- Contribution — how much is this outcome occurring because of your startup?
- Risk — what is the risk to people and planet that the impact does not occur as expected?
Consequence Scanning toolkit
To manage the last dimension of the IMP framework — risk — you might want to think about embedding consequence scanning into the way you work. This method developed by doteveryone asks you to consider:
- What are the intended and unintended consequences of this product or feature?
- What are the positive consequences we want to focus on?
- What are the consequences we want to mitigate?
These questions can help your team to raise concerns in a structured way so you can have important conversations and map the potential impact — both positive and negative — of your startup.
WorkerTech Framework
At Resolution Ventures, we are developing our own WorkerTech impact measurement framework to support out portfolio ventures.
Based on the four areas of work we are seeking to improve through the Workertech programme (pay, prospects, progression and power) and Accenture’s Skills to Succeed framework on depth of impact (connected, improved, transformed), this matrix maps out the different areas where ventures may be able to quantify impact.
You can use this matrix to work out under which area of work you are seeking to create impact (it might be more than one) and the depth of impact you are currently having, and what steps you need to take to deepen this.
Putting it into practice
As you can see, lots of tools and resources exist to help you think about impact measurement. The ones outlined here are just a selection to get you started. Luckily, BGV have tied all these tools (plus a few more) together in their Impact for Startups guide with implementation examples from their portfolio companies Open Energy Labs, Betwixt and Commonplace.
If you are building an impact startup and want the opportunity to receive investment and support, make sure you apply for BGV’s Tech for Good Programme before applications close on 19th June 2022.
Resources and references:
Sustainable Development Goals — UN
Theory of change in ten steps — New Philanthropy Capital
Theory of Change Toolkit — Nesta
Five dimensions of impact — Impact Management Project
Consequence scanning toolkit — doteveryone
Impact for Startups — Bethnal Green Ventures
For investments at the very early stages (pre-product, pre-revenue), check out BGV’s 12-week Tech for Good programme (applications are open until 19th June 2022). For investments at the later stages, head over to Resolution Ventures’ website for more details.
This series is brought to you by Bethnal Green Ventures in partnership with Resolution Ventures, the venture arm of the Resolution Foundation, a think-tank focused on improving the living standards of those on low-to-middle incomes.
