Investors are savvy; they’re starting to change their tune in the intro itself rather than at the crescendo. Sustainable VC, while a fairly new form of investment, looks not only for profit but also for impact on the environment and society, taking into account myriad factors such as ethics, governance, gender dynamics, philanthropy, and a commitment to the restoration and improvement of the planet.
What do you observe if you look at the rise in movements these days? First, a few trends that are capturing the attention of people and going from fads to habits are thrifted goods, such as pre-loved clothing (which was earlier derided as ‘second-hand clothes’), DIY furniture and decor, a rejection of fast fashion, minimalism, veganism, supporting small businesses, curbing your carbon footprint among other trends. The second, these ideas are the bastions of millennials and Gen Zs, which are the generation that comprise the customers, users, moneymakers of the present, and the inheritors of the planet in the future.
The bottom line is, sustainable VCs are a way of moving forward. This space may not be bursting on its own in the technical sense, but rather like more conscious movements, there is deliberate crafting and push to make them happen. Thus, unlike need-based movements like the industrial revolution, where ethics or balance were sidestepped for technology and progress to gain footing, these movements will see a conscious evolution where at every step, the question to be answered will be, “But how does this decision impact the environment and society?”
We can be excited and heartened for a world where instead of lip-service to good causes or philanthropy for positive press and tax breaks, the business model will ask itself the hard questions before taking the next step. If money is what makes the world go round, then this handshake agreement between profit and sustainability could just be the paradigm shift the world desperately needs.