How to create an impact strategy: four steps for tech for good founders
August 16, 2022
In 2021, tech for good companies raised £2 billion in investment. There has never been a better time for founders inspired to solve real problems. Since 2012 we’ve supported over one hundred impact-driven startups and have developed a deep understanding of how to build a tech for good business.
As we invest at such an early stage, most companies have an impact ambition rather than a solid impact strategy. That’s ok, but as ventures launch and grow we, and other investors, want to see how good intentions are becoming meaningful outcomes.
So, as a founder, how do you create an impact strategy? Our Impact for Startups guide gives a full deep-dive into how to do that. If you want the quick version, here are four steps to follow.
“Impact is a change in an outcome caused by an organisation. An impact can be positive or negative, intended or unintended.” - Impact Management Project
1. Set your impact objectives
Think about the impact that you want to create. How will you know that you have succeeded? What should be measured? How will your impact management evolve as you scale? The answers to these questions are not always straightforward but they are important in helping you refine your route to achieving your target outcome. If you’re not sure where to start, try the steps below:
Once you have an idea of your objectives, the next step is to understand the data you need to collect to be able to validate your impact objectives. Expectations of your ability to prove your outcomes will increase as you scale. We've put together a Stages of Impact Table (sneak peak shown below) to provide a framework from startup to Series A+. By filling in this framework, you should get a snapshot overview of your existing impact data and processes.
3. Plan how to address gaps or implement improvements
Based on the snapshot of your data, you should have a clearer view of the areas for which you need to improve your data collection and validation. A common area many startups need to improve their evidence for are 'Risks'. If this is the case, you could start making a plan to document them by doing a Consequence Scanning Exercise.
4. Learn and adapt as you grow
Once you have addressed your priority areas, you might uncover insights that will make moving to the next stage more intuitive. For example, once you have documented your risks, you will probably conclude that it is not sufficient to simply know what they are. Instead, you need to put in a process to regularly review and mitigate them. This should help place you in a good position to fundraise from impact investors for your next stage. Ask yourself a few questions. What are you good at? Where do you need to improve? Is what you are doing sufficient for your stage? Use your answers to these questions to guide your impact strategy as you scale.
Bonus tip: Think about how you can integrate impact data into your business as usual activities, such as team standups, reporting, customer analytics or something else that you do on a regular basis. This should help to ensure that your impact remains front of mind at all times.
Bonus tip: Engage your team in your impact and communicate why it’s important to you. By equipping your team with an understanding of the business imperative of impact management, more people are likely to start taking initiative in suggesting solutions and managing risks.
Additional resources to develop your impact strategy
1.Impact for Startups - an extensive guide for founders to get to grips with all things impact. From a fundraising checklist to communicating your mission.
2. Consequence scanning exercise - a way for organisations to consider the potential consequences of their product or service on people, communities and the planet.
Being a B Corp is really important to us at Bethnal Green Ventures. Our mission is to invest in and support startups that use technology to solve important social and environmental problems. The B Corp process holds us accountable and means we maintain high standards for our actions towards all our stakeholders.
As a tech for good VC, we often get asked, 'How do you know the impact of your companies is real?' It's a more complex question than may seem at first. The nature of early-stage businesses means there’s still a great deal of uncertainty. So how do we know that our investors' capital generates real change?
At BGV, we want to ensure founders from all walks of life feel included in our community and have access to equal opportunities. For the third year in a row, we're sharing the results of our portfolio D&I data and our commitment to increasing diversity and inclusion in our work.