1871 Says: The following is a Q&A with Impact Engine's Noelle Juengling and Chuck Templeton. To view the original post, visit http://theimpactengine.com/why-chuck-templeton-believes-its-a-competitive-advantage-to-build-an-impact-company/
Chuck Templeton is passionate about companies who are solving the worlds biggest challenges. Most people know Chuck as the founder of OpenTable and Chairman of Impact Engine, (and the guy who just got back from Costa Rica) but he’s been an investor, advisor, and board member for many other early stage startups. As we prepare for our next class of impact entrepreneurs in both the Accelerator and new Seed+ program, and also following the launch of our Angel Network, we wanted Chuck to share his thoughts on Impact Engine’s evolution. We connected with Chuck via email to learn about the shift toward impact happening in the marketplace, the value of being a part of Impact Engine, and why he believes that over time non-impact companies will be at a “competitive disadvantage”.
You’ve been a part of Impact Engine since day 1, as we’ve grown over the last 3 years what are you most proud of the company for accomplishing?
CT: It is great to see the Impact Engine community continue to grow. We are watching some of our early companies start to gain traction and become rising stars in their industry. We are seeing the entrepreneurs that we worked with get more sophisticated and seasoned on everything from team building, to sales, to thought leadership to fund raising to developing new markets. We are seeing more and more mentors and investors becoming interested in impact, rolling up their sleeves to get involved in businesses they believe in and putting their time and assets to work to make the world a better place. And finally it is great to see the changes happening in the broader community like 1871 and other organizations asking their members how they make the world a better place. It is fun to be part of this shift happening in the marketplace and know that Impact Engine had a role in this momentum.
What is the true value of working with a fund like Impact Engine?
CT: There is no shortage of investor money out there even though as an entrepreneur it can sometimes seem impossible to raise money. So the value of working with a fund like Impact Engine is only partially the capital it has. The best part of working with Impact Engine from an entrepreneurs perspective is the network and experience that comes with the capital and often times before the capital. Impact Engine has worked with dozens of startups but also interacts with investors, mentors, customers and executives on a day to day basis. So its not just capital that you get, you get a passionate group of stakeholders that want to help at every turn.
From your perspective, as an entrepreneur, what are some of the benefits of building a company through our Accelerator or Seed+ programs?
CT: It is hard to be an entrepreneur. It can be confusing on how to spend your time, where to prioritize and have a trusted place to vet your ideas (or frustrations even). But when you work with an accelerator or seed+ program like Impact Engine, you can leverage a lot of learning and experience that they have. They can help reduce the number of mistakes that you might make (and you will make many) while increasing your chance of success. There is no guarantee to working with any of these programs, but (in my opinion) the goal for a first time entrepreneur (and even seasoned entrepreneurs) should be to maximize the chances of success and not try to optimize their ownership outcome. Not saying that an entrepreneur should be nilly willy with their equity and ownership in the company, but that shouldn’t be the focus. The focus should be having a nice slide of the watermelon and not the whole grape.
As a dedicated impact investor, how are you screening investments and what does impact mean to you?
CT: Impact is hard to measure in my opinion. I have seen lots of ways of measuring and all have their strengths and weaknesses. So, for early stage companies, I like to see (at least) one primary impact measurement that is tangible. And I like to see companies that have the impact ‘baked’ into the business model. So that if the impact is pulled out that the whole model falls apart. I want to make sure that the model is built into the business in a way that it can’t be modified or removed if things come under pressure. So if the business does well financially, it will also do well from an impact perspective and vice versa. If your business is not making the world a better place, I think you will be at a competitive disadvantage in the next few years for many reasons (human capital, financial capital, natural capital and customer demand).
What are some of the biggest challenges that you see entrepreneurs facing, when building an impact company?
CT: I don’t think that building an impact company is any different then a non-impact company. As I mentioned in the last question, I actually think that over time, you will be at a competitive disadvantage to building company’s that don’t have impact built into the model. You will find it harder to get world class talent (because they are increasingly heading to ideas that they have passion about). You will find it more expensive to buy virgin raw materials for your business (so if you are not thinking about a business built on a circular resource pattern, your costs will increase relative to your competition). More and more capital is moving in the direction of wanting to do good and do well (so those building impact into their businesses will have access to capital others don’t). But most important is that more and more customers are looking for/ requiring companies to be responsible participants of the world. So, the only way to be successful in building a business is to have impact baked into, otherwise it will be an even steeper uphill battle.
About the Author
Noelle Juengling, Marketing and Communications Associate, Impact Engine
Noelle Juengling handles communications at Impact Engine, a venture fund that invests financial and human capital in early-stage, for-profit technology businesses that are improving education, health, economic empowerment, and resource efficiency.