In recent months there’s been a lot of commentary portraying entrepreneurs as the saviours of the global economy, while at the same time questioning the venture capital industry’s ability to deliver the right solutions to meet society’s most urgent challenges.
In many ways it’s true that there’s never been a better time to start a company. Tech is now horizontal and transformational technologies are all maturing at the same time. Some business models – such as physical branch banking/insurance – look set to go the way of the dinosaur, while others have had to undergo digital transformation almost overnight, for example education services and non-urgent healthcare. Indeed, some businesses are even questioning the value of the physical office workplace itself given that millions of workers have had to adapt to working from home and embrace collaboration and team-working technologies to keep up their productivity. The direction of many industries will be forever shifted as a result of the COVID-19 pandemic.
Furthermore, problem-solving is a key driver of innovation and the current crisis has given us urgent new problems to solve. The bigger the problem, the more likely it is to blow up inertia and accelerate the pace of innovation. A crisis stress-tested society gives us an unblemished view of where the real problems lie, and thus, where the biggest opportunities are likely to be found on the other side.
More from Interviews
- Interview with Christina Colmer McHugh, Co-Founder of Moodbeam
- Interview With James Napier, Founder of Carbon Management Company CBN Expert
- Interview With Petra Dobrocka, Co-Founder Of Byrd
- Interview with Richard Robinson, CEO at RobinAI
- Interview With Streetbees CEO And Founder Tugce Bulut
- Interview with James Herbert, Founder and CEO of Hastee
- Interview with Bukky Maybank, Founder of Making Humans
- Naomi Empowers: 5 Tips For Aspiring Entrepreneurs
However, it’s also never been harder to build a valuable tech company. Companies need to be really unique and must address genuine real-world problems while at the same time attempting to predict what our post-COVID society will look like. The startups capable of addressing society’s most pertinent problems – founders or the so-called visionary ‘one-percenters’ who are capable of reimagining what our day-to-day looks like – are the ones most likely to endure the current trading challenges.
Yet, while even the most highly-skilled and intelligent founders are not superheroes, the current crisis dictates that they arrive at urgent solutions faster and more economically. This is why today’s startups need more than just capital to succeed.
Consequently, the role of the venture capital industry must also involve more than just capital. VCs need to back the right founders and back up their capital with stability, support and mentorship, helping empower entrepreneurs to build more resilient businesses focused on the biggest problems facing society. This type of investment is inherently impactful. It drives progress and value, stimulates competition and creates more dynamic marketplaces. It’s what we describe as an ‘activist investor’ mindset, and it’s a mindset we believe more VCs should adopt.
At this momentous moment in our shared global history, there is a unique opportunity for VCs to serve as the catalyst for the new wave of innovation. Activist investors who take the time to identify the right founders and work in partnership with them to address pressing real-world challenges will help us to finally eliminate the question marks surrounding the VC industry’s ability to deliver the companies, products and services that the world really needs, by delivering the companies, products and services that the world really needs.