Startups are well-known for their steadfast belief that what their company is doing is making the world a better place, so much so that it’s become a running joke in the community. But what does it mean to actually be a company that embraces social impact as part of its DNA?
Gathering 100 global female entrepreneurs — including Demalogica founder Jane Wurwand and Care.com founder Sheila Marcelo — United Nations representatives, and executives, the Dell Women’s Entrepreneurship Summit in Cape Town, South Africa tackled this very question against a backdrop of celebrating the successes of female-led businesses, as well as acknowledging challenges across the world that prevent more women from pursuing business ownership.
“When you’re solving a problem authentically and in a way that makes sense for users, people will pay money for it.”
Going on its seventh year, the Summit invited these entrepreneurs to share their stories both as keynotes and smaller, interactive breakout sessions. One of these entrepreneurs included Toronto-based entrepreneur Sarah Prevette, whose past ventures include Sprouter (which later became BetaKit), and BrandProject, a firm that invests in early stage startups backed by business leaders from LEGO, Virgin, and Starbucks.
Prevette ended up leaving BrandProject to pursue a venture that she said would allow her to more directly help budding entrepreneurs. Sitting with Dell’s chief responsibility officer Trisa Thompson and Dell’s VP of client solutions marketing Alison Dew during a breakout session, Prevette talked about leaving BrandProject to pursue Future Design School, which works with youth between 11-18 to develop leadership qualities and an ability to approach problems creatively through the entrepreneurship experience.
“Being a mission-driven business is not just great for customers, it’s also good for really galvanizing employee evangelism. I think that’s a really powerful tool and people recognize that,” Prevette said.
While a lot of conversations around social impact businesses usually surrounds the fact that making profit and making a difference are mutually exclusive, Prevette said that social impact is now becoming a metric for investors in its own right. At the same time, millennials — who are more likely to pay more for products with a positive social and environmental impact — are increasingly starting impact-driven businesses.
“FDS is a great example of being mission-driven and profitable,” said Prevette. “We could’ve been a not-for-profit but we chose to be a for-profit enterprise because we believe we can grow a profitable business. When you’re solving a problem authentically and in a way that makes sense for users, people will pay money for it.”
Prevette, however, said that it’s key for companies to know their mission from the start if they hope to grow businesses that both make an impact and make profit. Once a company reaches the scale of an enterprise like Dell, it’s tougher to go back and become more of an impact business without looking inauthentic. “You’re driving a mission and rallying your team, and if you start with that mission in the early days, you can continue with it and get your employees and customers as part of that mission,” Prevette said, stressing that startups in particular have an advantage because they’re so close to their customers. “Empower the frontline people to make decisions and have that agency, and they’ll have the ability to solve problems faster. It’s much harder, but it’s doable.”