As different business models emerge, so do the means to boost innovation, among those, mechanisms to access finance and a new type of investors. In order to make their business flourish, Sustainable Entrepreneurs can rely on various financial mechanisms already existing and, why not? Explore the possibilities of creating new ones.

Venture Capital

Venture capitalists are people that provide money from a fund financed by a group of investors interested in start-up businesses with exceptionally high growth potential. Venture capitalists invest in new businesses in exchange for a share of the enterprise, but do not necessarily want to hold a permanent ownership of these business shares. After a period of some years where the business increases its value through the use of the invested money, a venture capitalist will typically "exit" by selling the shares they hold, either back to the entrepreneur or to third parties.
The advantages of venture capital financing are:

  • Venture capital investments are not entitled to recover funds in the event an enterprise becomes insolvent.
  • Businesses with sufficient equity will be more appealing to other lenders and investors. In the business balance sheet venture capital appears as equity, since it is provided by shareholders (venture capitalists), who in technical terms are also part “owners” of the start-up.

Venture Philanthropy

Venture Philanthropists are individual investors, trust funds and corporations that donate resources (financial or human) to different charitable causes. The involvement of venture philanthropists normally represents long-term engagements, tangible results and exit strategies. As a class of investor that aims to develop the non-profit sector and promote new vehicles for investment, venture philanthropists possess a unique set of skills to blend traditional financing practice and entrepreneurial initiative with the aim of promoting, enabling and/or developing sustainable businesses at a variety of scales from the planning stage to full independence over time.

Sustainable Intrapreneurship

Sustainable Intrapreneurship is a means to encourage the innovation potential of a company and contribute to sustainable development by enhancing and leveraging entrepreneurial skills and sustainability driven innovation among employees. Being aware of how internally generated innovation can help companies enhance the sustainability of operations, products and services is important for mature businesses and civil organizations alike. Hence, Sustainable Intrapreneurship offers the opportunity for organizations to explore opportunities to boost employee creativity and translate their potential into sustainability driven competitive advantage.