What is a sustainable business model for a startup? What types of problems are startup businesses trying to solve with their products and solutions?
Yoav Elgrichi and Kineret Karin from ImpacTech invited the Inceptery’s Anna Itkin to share what it could look like and what it could mean for ‘tech-based startups here in Singapore at Shell’s #idearefinery group.
The session kicked off with key facts about the implications of our current technological consumption rate, research findings noting important issues to millennials in their purchasing habits, global risk factors and opportunities for businesses. Anna then explained some key principles and a broad definition of a sustainable business model.
“From a sustainability perspective, a firm’s value creation logic should consider the integration of social and environmental goals into a more holistic meaning of value (i.e. products and services, business model, strategy and operations)”.
She then offered some case studies – of both established organizations and fledgling enterprises that were addressing these key challenges with their technological development and more importantly novel business models that focused on social/environmental impacts and value creation. Examples shared included – mobility as a service from Riversimple in the UK, a revolutionary laundry solution born out of Leeds University – Xeros, and an innovative solar product range for off-grid customers with a unique low-cost pay-as-you-go business model for emerging markets – Indigo (by Eight19). These examples were paired with the business model archetypes that the Inceptery’s Padmakshi Rana co-developed with the team at Cambridge.
There was a short Q&A, followed by a discussion with the accelerator teams in attendance.
The key question was “How can a startup, which is still battling for monetary stability think about sustainability (people or planet) within their business model?”
Though at least one of the teams there had founded their business/product/service based on addressing such a need (either socially or environmentally related), i.e BillionBricks; it was evident that many still view sustainability as an add-on, luxury, nice-to-have, or an afterthought.
Though a developed country, Singapore is in no way isolated from the potential of both social and environmental risks associated with climate change and other sustainability-related issues. As an island, it is also subject to these, just as other countries are. Businesses here should be aware that they can both leverage opportunities, prepare for the future and contribute to something bigger than themselves.
It is indeed the case that financial sustainability is a fundamental factor. However, our general opinion is that, in many ways, it is significantly easier for new businesses to integrate some degree of positive social and environmental impact into their business model at an earlier stage, no matter how seemingly small. Not only are they likely to be more agile and flexible at smaller sizes, but they also have the benefit of being able to course-correct and the freedom, that many large, (sometimes publicly listed) corporations ‘do not’.
Many believe that within sustainability – scale is the defining factor – but what is often overlooked is that solely focusing on it, can sometimes disempower both organizations and individuals from starting – at any point at all – which could be even more detrimental than having no clear way to ‘scale’ at an early point. We believe it is critical that they are not discouraged in moving forward with such attempted endeavors. What we also believe at the Inceptery is that in some instances, obsession with scaling (up) is actually a negatively contributing factor to a number of the challenges that we face today. (We will post another article on that sometime in the near future).
The session ended with a challenge for the following week, from Yoav for the teams to think about ways in which they could potentially embed some elements we shared – into their current business models.
We extend our appreciation to Yoav and Kineret for inviting the Inceptery to share at this session and congratulate ImpacTech for recently being appointed as the program lead in Singtel’s Future Makers 2018.