Reflections While #StayingHome: What Technology And The COVID-19 Crisis Are Teaching Us About Conscious Investing
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A note from VentureSouq:
When you cut to the core of it, our job at VentureSouq is pretty straightforward: we predict what themes are likely to happen in the world, determine which young companies are best suited to benefit from those themes, and then invest and convince others to allocate capital into those companies.
It’s thus part of our job to reflect on macro scenarios like that which the entire world is experiencing today, and follow closely as data is released, policies are rolled out, and general temperament of people changes. We’re also drawing parallels to the First Gulf War of the early 90s, to the 2000 tech crash, 9/11 in 2001 and the Great Recession of 2008- understanding the historical fallout from events like these can provide a blueprint for how to predict outcomes or make decisions today.
But whether or not a trodden path exists for any particular company, organization, government entity, or individual even, there is one absolute certainty: that the situation we’re in now changes everything for everyone.
We are venture capital (VC) evangelists. Ultimately, we believe in the long-term gravitation of the world towards a more globalized and technologically interconnected place. There is a prevailing belief that these two factors -globalization and technology- are the root source of the black swan event we’re experiencing now.
But we have no doubt that it is the same two factors that will ultimately get us out of this. This conviction runs through the arteries of our company. But we are also individuals, who can offer unique perspectives to our stakeholders, or other members of the venture and entrepreneurship ecosystem.
So we thought it would be an opportune time for each of us partners at VentureSouq to share some insights into, one, how we are processing this frightening, bizarre, dynamic, fascinating experience, and two, where we think this dislocation will give rise to opportunity, for our stakeholders and investors, for our portfolio companies, or for ourselves as a team.
The below is Founding Partner Sonia Weymuller's account.
This time is one of self-reflection for many investors. The coronavirus pandemic and its ramifications have highlighted (and will likely accelerate) the broader movement towards more conscious thinking when we invest.
Companies are doing extraordinary things to leverage emerging technologies for the collective good of our species. Examples abound: from the use of AI to track and forecast outbreaks and diagnose viruses, to harnessing drones for medical supply delivery, to chatbots being used to disseminate health and travel information, to robots sanitizing and delivering goods, just to name a few.
Recently, we were fortunate to host Deepak Chopra and Mona Hamdy as part of our newly launched Conscious Collective content series. In this inaugural session, we addressed how these very technologies are being used as positive weapons towards combating this pandemic. “We are a species of short vision and shorter memory– this experience is a reminder of how interconnected we are,” Mona said, and she was right- technology is forcing all of us to commune in the face of a common threat.
The COVID-19 crisis has exposed just how intertwined we are, and how issues of public health and the environment need to underpin any investment now being made. Some of our portfolio companies already reflect that (Dendra, Pachama, Medinas, Helium Health), and others are adapting to today’s status quo and reinventing themselves– Immensa Technology Labs has recalibrated its 3D printing business to provide medical face visors and address supply chain disruptions, while Scanwell is looking to launch an at-home 15-minute coronavirus test.
But this virus has also blatantly exposed quintessential systemic issues- “gross income disparity, a huge carbon footprint, a pitiful level of well-being for the world’s under-privileged, and an ingrained prejudice against the poor and anyone not like us,” Chopra highlighted. Technology can therefore also serve to exacerbate these imbalances and world divides. “It is part of our evolution- you can’t stop technology, it reflects our biases, and is an expression of our collective consciousness,” he continued.
So, what does this mean for us as investors?
We need to rethink how we choose to invest our money. Investor demand for conscious investment strategies that prioritize positive impact is front of mind today, and it will inevitably continue to grow.
We’ve already witnessed the next generation of investors leading the growth in demand for environmental, social, and governance -focused, mission-driven finance. It’s clear: millennials want both return on investment and impact– they demand that their investments have a positive global impact, and act as meaningful influencers of change.
Similarly, we’ve seen conscious corporate venture capitalists (CVCs) emerging– private and publicly listed corporates shifting their corporate social responsibility (CSR) budgets towards equity-based conscious investments: Twilio, Comcast Ventures Catalyst Fund, Salesforce Ventures Impact Fund, Parrot, and ENGIE are just a few examples.
Mainstream traditional players have already followed suit as well– from TPG’s US$2.5 billion impact fund, to KKR’s $1.3 billion vehicle announced just two months ago. BlackRock CEO Larry Fink’s annual letter backs this up, and serves as a clarion call to chief executives worldwide: “We believe that sustainable investing is the strongest foundation for client portfolios going forward. A company cannot achieve long-term profits without embracing purpose and considering the needs of a broad range of stakeholders.”
Therefore, just as we’re seeing technology act as a multiplier for good, it’s also time for VCs to act as a magnifier- of good. It is up to us to ensure the investments we choose to make are true reflections of our collective consciousness. We should take this time to reflect on how to make lasting systemic changes, starting with how we choose to invest our own capital.
Chopra ended our session by reminding us that the last extinction occurred in less than an hour. “At this moment, it’s not important to think about ourselves, because we are not important in the big scheme of things. If insects disappeared from our planet today, life would stop in five years. If humans disappeared from this planet, life would flourish in the next five years.”
The need for an alternative system of investing is on the rise. And you, as an investor, have the choice to ensure that your capital acts as an accelerator of change for today’s most immediate challenges.