I am excited. As I am always when I come up with something new to build. I am excited to share the vision of Planet A Ventures and our way to tackle the most urgent problems of our times by changing essential metrics of early stage funding.
When I started backing founders I realized that the way traditional investors are taught to look at numbers manoeuvred our economy and our planet into a substantial crisis. Because looking at numbers meant predominantly to look for financial return at all costs.
But looking at numbers also has the potential to save us. What we need to change is the kind of numbers we’re looking at and how we look at them.
Let me start from the beginning and give you a little more context.
It all began in 2017. I just came back from 120 days shooting “Founders Valley”, a 10-part documentary about founders in Asia. The idea was simple: A german entrepreneur (yours truly) meets entrepreneurs that try to tackle topics like climate change, water and food shortages or other big challenges of our time.
The trip completely changed my life and my perspective on the responsibility of entrepreneurs.
Up to that moment, my professional life consisted pretty much of building jimdo, a website builder that I started with two friends when I was 16 years old. We wanted to enable small enterprises and everyone else to build their own website. We are incredibly proud that our product and our company full of amazing talent helped over 25 mio people to do so.
But here’s the thing: When I turned 34 I realized that I had spent more than half of my life with jimdo. I just wanted to explore the world and the invitation to be part of “Founders Valley” appeared to be a pretty great opportunity to do so.
Together with an amazing crew I was lucky to experience things like living with eagle hunters in the rocky desert of Mongolia or staying overnight with indigenous people in the rainforest in Malaysia. But the trip was also a trip to the underbelly of our economic system. We witnessed the housing situation in Hong Kong where 500,000 people are forced to live in subdivided flats with very little to no space and privacy. It got even worse when we arrived in Central India. I interviewed a farmer that tried to commit suicide because he had little to no harvest the third year in a row due to the extreme weather conditions in the region. The correlation between changed weather patterns due to climate change and suicide rate couldn’t be more obvious and has even given the region a terrible name — Suicide Belt.
I could tell you about the working child that I was invited to follow for a couple of days and witness his factory life in Dhaka, Bangladesh. Or the endless waste dumps we filmed in India and Indonesia.
The important thing though is the pattern behind each one of these stories:
The economy we have built is not beneficial to all of us. And it’s not beneficial to the planet either.
Ignoring this has become a massive boomerang as green house gas emissions, air pollution and social unrest don’t care about borders. Let me be honest: All of that had been really far away from my personal life. In an abstract way, I knew that many things are seriously wrong. But I never experienced them first hand.
Coming back home after 120 days of travelling and filming felt pretty awkward and I had a really hard time reconnecting to the life that I had before. German might be a complicated language, but it comes with uncompared plasticity: I think what I felt was “Weltschmerz”.
In order to turn my experience into a positive vision of my future I talked to many people and I looked into the numbers a lot:
10 % of humanity account for 52 % of cumulative GHG emissions (Oxfam). We are degrading our soils at such an alarming rate that the world could run out of topsoil in about 60 years (UN FAO). At the same time the sixth mass extinction of wildlife is accelerating (Stanford University). It all boils down to massive overconsumption of the natural resources of our planet: We consume the resources of 1.7 earths (Global Footprint Network).
But chances are high that you know these worrisome statistics and belong to the kind of people that are fed up with alarming articles and prefer to take action.
My way of taking action was the decision to allocate all my time and resources into founding something with a positive impact on planet earth. I co-founded an impact startup called wildplastic and became an advisory board member of the Tomorrow bank and the Impact Hub HH. Additionally, I did a couple of investments into companies like Carbo Culture and Greenloop. I also realized that there are a lot of founders out there that take huge risks to build an economy that serves the people and the planet. And met a lot of serial entrepreneurs that signaled to me that they are willing to commit time and resources to enable and grow startups, too. Many conversations led me to believe that I was on the right path.
Yet, I kept asking myself: How can we anticipate whether an idea really makes a significant difference?
I kept searching and while building Wildplastic I learned a lot from Anne Lamp, who introduced us to a precise method of calculating the ecological footprint of a product or service and matching it to the status quo in order to measure its impact. Boom. There it was: impact measurement. Finally, impact investment could be backed by a scientific approach, a life cycle assessment. By combining the LCA data with business projections we can do pretty solid impact forecasts, too.
Being actually able to provide science-based calculation and forecasting of impact motivated me and a couple of like minded people to start an impact investment company called Planet A. A venture capital fund which focuses on backing founders tackling the world‘s largest environmental problems.
We are convinced that tomorrow’s economy is based on today’s investment decisions. Early stage funding decides which ideas turn into companies. And some of these grow into a big part of our economy. The aim of Planet A is to focus on backing the ones who are able to align the planet, people and profit.
The massive environmental challenges we face are beginning to kick off a fundamental economic transformation. This is a fertile soil for innovation and a massive chance for a new breed of companies creating change. We predict that the magnitude of a company’s positive impact will be a proxy for its success.
Given the short time we have to stop emissions, pollution or overconsumption of resources we need this degree of precision to be included into our investment decisions.
As a consequence venture funds need to add a new dimension to their processes in order to have the right numbers to look at: a robust, quantitative understanding of the consequences of their investments on nature.
My personal consequence was starting Planet A ventures with a terrific team of like minded people. It’s the reason for my excitement and I believe it will be the reason for excitement for a lot more people. We want to shape an economy that only uses the resources the planet can provide by supporting and scaling European early stage companies that have a significant positive impact on planet earth. We do this with our 3 pillar approach:
- scientific measurement and forecasting
- support from mission driven founders
- money to invest in purpose
Let’s get our hands dirty and start. We don’t have much time left. Let’s start making the right calls, because: The economy we create shapes the only planet we have.
Author: Fridtjof Detzner