 Hi guys, welcome. We're really excited about the next topic where we talk about impact in startups and what used to be maybe a checkbox exercise for Swedish pension funds or something for just for panels and long discussions has really become front and center for employees, entrepreneurs, clients, LPs, everyone. And so it's great that we're sitting here with two people who have been working on this topic from before it became trendy like crypto and AI. So we have real people here who can really tell you something that matters on the topic. And yeah, we'll do a round of introductions. I'll briefly introduce myself. I started as an entrepreneur long ago and have been in a VC for 12 years, so lived through two crises, which is very helpful right now. I'm with Norseone. We're a large global venture fund, just raised a billion, so we have a little dry powder to go after the current market. And in our portfolio, we see both companies really formatted around impact like an item that's trying to stop cardiac attack in the world or an iron ride that wants to electrify all the fleets, but also big companies like a personio who have raised 100 million for impact and photo that is sort of trying to do sustainable credits for ocean freight. So the topic is really front and center in a lot of the things we do. Willemaine, how about you? I have a very big different background than Mikhail. So I started out from the impact side. I founded an NGO called War Child at the age of 23. And that was a scale up because we grew to 900 people in 13 countries working with a million kids. So it was an amazing ride. And I stepped out. I'm still on the board, but I stepped out because I believe innovation is what really what we need to create impact. And NGOs are not the best actors to create innovation. So I wanted to move to the venture space to find innovative models that are scalable and sustainable. So I first built the Dutch social enterprise network, which is like an ecosystem for entrepreneurs on a mission and how to help them scale and grow. And as part of their mission, it was access to capital. And then I built with an amazing team of experienced VCs because I needed them on board. Of course, we build Ruby Olympic Ventures, which is a Dutch venture fund investing in impact and really take an impact seriously in every step of the investment process. I'm sure we'll get to that. And Emma, you're very well known here to the crowd. Can you tell us a little bit about your background? Yeah, of course. So my name is Emma Lehekoyen. I'm the CEO at Swappy. And my journey with startups actually started here at Slush. I was a Slush volunteer for the first time in 2015. So that's really my first touch to the startup world and kind of how I became super intrigued about the topic that how startups can create impact to the world. But Flash forward, I was doing Slush for several years, president of Slush. And then back in early 2020, I joined Swappy. And Swappy is a company whose mission is to make refurbished mainstream. So we started with consumer electronics, started with iPhones. We basically buy, repair and sell refurbished iPhones. Amazing. And I'm sure there's a lot of customers here in the audience. Shame on you. So from president of Slush, in my perception, you then have a perspective on all kind of startups in Europe. What made you pick Swappy? Back when I left Slush, and I was thinking kind of what I want to do next, I met our co-founders, Sami and Jiri. And I felt super inspired what they were building with Swappy. I felt like it was such a unique opportunity to join a company was kind of in the high growth journey, but with a purpose that actually matters. And that's how I joined the team. And three years later, it's still here. That's great. So, Willem, there was, of course, always this whole social investing that existed. But you're probably one of the new, the first of the new generation of impact ventures that also believe that they want to make a real return. Can you tell me a little bit about the early days of how to get it off the ground? And how hard or easy was it to get that story across? Oh, yeah. I think for me, it was very evident that we needed to make market rate returns, because if you want to get mainstream capital to flow to impact, you have to prove that impact is a flywheel for success and impact is not a cost factor. So for me, it was evident we really need to approve that companies that are excellent at creating financial returns and impact, those are the rock stars of the future. And that's what we need to focus on. But it was definitely when we started this, a field where that was being frowned upon, you know, how do you, if you found these entrepreneurs, can you actually exit them? Who's going to buy them? And so I think the market has changed in those years. And we see that there's a big demand for especially strategic buyers that want to get into these, find the innovation and get these young impact driven entrepreneurs integrated. But I think for us, it was getting the first LPs in was kind of the early believers. But now we see mainstream LPs coming in. And for us, it was really important that impact is not a greenwashing thing, that impact impact is equally important to returns, which meant that we really had to find a way of measuring impact in an equal way to measuring financial returns. Because how can you be successful in both if you only measure risk of return? So if you want to measure risk, return and impact, you need to quantify impact. And we found a way to do that. And that took quite some time to get that strong and objective. Because if we set our own impact targets and then we perform well, then we could set them very low and always be very successful. That's of course what many funds are doing. And I think if you set targets, for me, for one, this target has to be decided by the entrepreneur, right? The impact comes from the heart or the mission or the activism of the entrepreneur. And so you need to catch what he or she wants to prove. So what is it that he or she wants to change in the world? What's their theory of change? And how can you measure that in one maximum two KPIs? And then the entrepreneur must like to report on that, just like reporting on finance. And then we, as a fund, we use those targets to link our performance, 100% to our carry. And we have a carry link to impact and return. And we need to make both to be able to receive any carry. So for me, that's the way to really structure it in the entire process and make sure that if we're successful, we need to be successful in market rate returns and quantifiable impact. That's very impressive. How do you and how do you do that actual measuring? It is when it's like climate tech, it's not that complex, right? When we talk about CO2, there's a lot out there. And but if we talk about what I call people tech, when it's about education of children or what it's about well-being, mental well-being, it becomes quite difficult because it's not about numbers. It's about whether people feel that they've actually improved their quality of life. And so those things are very hard to measure. So it's kind of qualitative measurements that we need to find ways to do. But so and sometimes, of course, we get it wrong. We invest early stage. So the business pivots three times and then you took the wrong measure. So that happens. But the essential is that you find a measure that really inspires the entrepreneur that he really or she really wants to prove. And then together we can figure it out. And it's like building the plane while flying. And we have a couple of impact funds across Europe that we kind of shared our knowledge with and also our fuckups because, of course, we did some stuff that really didn't work as well. But in the end, it is possible. I mean, people that say that impact cannot be measured are wrong. It can be measured. It can be done. But it takes work. And it is extra time in your due diligence and process. And with your group of early funds, is this sort of your proprietary sauce and makes you special and you keep it to yourselves? No, no way. Or is it something you would share with the world? No, no. My mission in this is I want all of you here, all the investors, by the way, and as well to move into impact. So whatever we can do to make this mainstream, we need to share and how to measure impact open source. I can I talk about this a lot different stages. But I would really love to share. But I think a lot of people find it a little work. And the big confusion is people are confusing ESG and impact. So now we have all these as we are article nine, and then people think their impact for me, that's ESG. And that's just cover your ass, right? It's just do no harm. And if you want to measure impact is how are you bringing actually positive additionality, positive value to solving a societal problem? And I would hope I don't think every entrepreneur has to have that mission. But if you have it, try to measure it because this is also what inspires your clients and your consumers and your staff. So it's possible. Great. I won't go more into detail. Yeah, yeah, well, definitely. But now I talk to Emma. I can explain how she does it. Sure. Yeah, let's start a little bit on sort of how did Swapy get to get started? Yes, I think it's a great, absolutely great story. So Swapy was started in 2016 by our co founder, Sami and Yuri. And they were serial entrepreneurs back then already. And actually, Sami got scammed when he was purchasing used iPhone out of like this online marketplace. And they started to look into the market. And they realized that actually like only about 5% of the of the entire smartphone market was used as smartphones back then like super tiny portion of the market. And the barrier like kind of keeping consumers from purchasing second hand electronics was not that they would not like the proposition like it's more affordable. It's more sustainable. That's great. But they did not trust the product and they did not trust the way to purchase the phones. So that's how Swapy was started. The idea was that we repair everything ourselves. That's how we can keep the quality standards high. And we can really make sure that the quality is what consumers are expecting. And also we've kind of crafted the purchasing experience. So that it's as close as possible to purchasing a new phone with extensive warranty and great customer care. So how do we create this product and service that would make that kind of switch from consumers to really consider refurbished instead of new one. And I think we've done pretty great job so far. Although we are very early on the journey. I have to have to say still about back. As I said back when back when we started, it was about 5% of the market nowadays. It's somewhere around 10% of the market and growing super super fast as well. And if you think they like take industries like the car industry, for example, it's 50% of the market. So this category can really grow huge. That's amazing. And do you consider yourselves more just a tech company or more an impact company? Or is that the wrong distinction? I would say that we are a impact driven or mission driven tech company. I don't see that it's kind of either or. And how does that translate? How do you measure your impact? We just heard from Milamain that that's really important. We've actually just published our first environmental impact report. So how we measure impact is we take the carbon footprint of new device and then carbon footprint of swap it device and look at the look at the kind of saving that you can do as a consumer when you're switching from new to refurbished. And the numbers are pretty great. You can save 78% of carbon emissions by choosing refurbished instead of new. And how we like measure our impact as a company is that we measure how much savings can we help our customers to or like CO2 savings can we help our customers to make by offering this product taking taking a very conservative estimate on how many people are purchasing refurbished for the first time. And basically that's our that's our handprint as the company. And how much is that in total? Yes. So last year it was about 23 and a half thousand tons of CO2. And for someone dumb like me, what does that equate to? Yes. So that would be about, let's say like 5000 cars driving for a year. That's amazing. And I can imagine there's more impact in there because in these new phones, these value chains are very, very, there's a lot of human rights issues in the values changed. Children working in mines and Congo to get materials in phone. So you're you're actually also skipping all of that. So it'd be beautiful to also kind of measure that. But maybe very early. You're hired. It's very kind of early on our sustainability journey as well. So when we did this report, we wanted to start somewhere mess measure the CO2 emissions. But you're absolutely right. For example, the e-waste is the fastest growing waste stream globally. And we need to do something about it. And we need these solutions, for example, refurbishing smartphone and other electronics to be able to extend the lifecycle of those products so that we need to kind of source these rare minerals or rare materials less and less. Cool. And obviously, being a mission driven company has a big impact on the people working for you. How is that at Swapi? And what do you guys do to sort of promote that? Yeah, I'm always kind of surprised how amazing team we've been able to recruit. And I think kind of early on on Swapi's journey, we've had access to kind of people that I would say maybe not all kind of earlier stage startups have, because the mission has been something that the people who decided to join us have related to. And it is something that they want to work with every day. So I think that is really the big, big, powerful competitive advantage for missionary companies that you are able to attract talent that connect with the mission very early on with from these kind of global tech companies, that most startups kind of dream of hiring. And what do you do to keep that sort of alive? Because on the one hand, the overall mission is great. And you measure the CO2 savings. But what else do you do to make that tangible for people? Yeah, yeah. So I think it's like, it's very, very important to like kind of foster the culture that you have in the company, like we're kind of very people first or people driven company. And we want to really focus on that. So it's really not about like, you can tell like, you can talk about like the impact you make, but then day to day, it's really about kind of what kind of culture you have at the company. And that's really kind of to retain the talent. Great. I think it's often very much about authenticity of the drive. If the authenticity of the founders really felt in the company, people can feel it as a driver in the culture of what they're achieving together or something. Yeah, yeah, that's something you can kind of parachute in. And if we look because the other big sort of lever here, of course, is your customers who obviously kind of like a mission kind of driven approach in the companies you're working with Willemaine, or do you have some good examples of why they are winning because of their customer proposal? Yeah, I think the ones that are able to really make a convincing story of why the customers will want to join the mission. One of them, for instance, is Tony Ciacalone, Dutch chocolate company makes lovely chocolate, but I mean, you can buy lovely chocolate any brand. Their mission is to eradicate slavery from the from the plantations in especially West Africa, which is where most of these kids are to work. And so that's their mission. And I have sourcing principles, but they are very, very clear that so even if you open the chocolate bar, it is unequally divided, there's no squares, but there's unequal. So to really understand and make the consumer understand it's an unfair value chain. And if you're buying this chocolate, you're actually helping solve that problem. And that brand has grown extremely fast, even though they're more expensive than their competitors. So you're paying a premium, because it is more expensive to really make sure the farmers get enough money to actually hire staff instead of putting their kids to work or putting other kids to work. So it's extra cost in the value chain. But the consumers have taken this on massively. And the company is growing worldwide this moment and has been the biggest in the Netherlands. Six years after their effort, they found it. So that was really a fast consumer driven success. Great. And the flip side of all of this, because you can have a great mission, etc. Now that impact is so popular. I remember four years ago, I couldn't get a business plan on my desk, and it said AI somewhere in the business plan. Now with impact, you see something similar. And so there's a lot of greenwashing out there as well. Do you guys have some examples? Oh, there's I mean, there's so many of them. I mean, it's ridiculous. I think the funniest example is BP that changed their name from British petroleum to beyond petroleum. And then had to change it back because nobody kind of accepted that. But I mean, looking from the I'm a duchy. So look at Shell. I mean, they're amazing Volkswagen and that puts bogus systems to. So there's so many examples on big scale on small scale. And it's a big problem because people will no longer believe that impact is real as everybody starts using the words McDonald's creating impact with their similar reusable plastic paper straws that then tend out not to be recyclable at all, and then still make the claims. So there's there's there's so many examples. And I think it hurts the the movement because you need the consumer needs to understand that is authentic. And so that's I think a challenge you have to overcome and the authenticity. I mean, people do there's so much transparency now in the market. So we hope consumers will take the effort to dive a bit deeper under these kinds of Twitter and see what happens. Yeah. And I guess in order for the snowball to keep rolling, we need a lot of people here in the audience to build amazing companies or in the companies they're already building, put an element of impact into it. What what kind of recommendation would you give people that are starting today? Yeah, I really love to encourage kind of young entrepreneurs or entrepreneurs who are just starting out that they look at the kind of impact first or impact driven companies as an as an option to to start from. I think it's really important that you put kind of sustainability or the impact at the center of your business model. It's harder to kind of sprinkle that on on top. But also at the same time, I think kind of I don't see the distinction between kind of impact companies and tech companies so big, like for example, us, the day to day, we're, we're building e-commerce, we're building the operations, we are hiring talent. We're doing marketing. And these are lessons that whether if you're an impact entrepreneur, you can kind of take from both other impact entrepreneurs, but also every like tech entrepreneur that has been successful. Great. And what segments do you see kind of taking off right now, Willemand? What is from an impact perspective? Let me first reverse the question to you. Which ones do you see? Because you're an investor, you're getting every ambitious entrepreneur will end up at Norso and at some point. What do you see happening? I saw first of all a wave, a long wave of people doing carbon accounting. And obviously the first time you see it, you're like, oh, wow, we really need that. And then after 72, you're like, maybe we don't need 72. What I find really encouraging is that there's real room for technical innovation. So we're seeing smart energy plans, some of them purely based on software and calculations, some of really kind of innovative new materials. We're seeing material sciences kind of picking up. We see image recognition play a large role in a number of fields. And I like the fact that it's not just on the sustainable end of the spectrum that we're seeing on the people side, access to markets, access to education takeoff, which I find very encouraging. But what about you? I find that last part is, but that's a personal passion, right? I see it happening in every segment. But I'm personally passionate about people. So I love the fact that with edtech, we can actually reach kids in parts of the world that have not have access to any kind of education or talented people in Africa that get access to jobs internationally that they never used to have access to. So I'm really excited about the opportunities we can create to really get people out of poverty and into development through edtech. But also, I mean, one of the major issues now is mental health being not just among people, I think 50% of people within companies have mental problems, the mental problems since COVID in schools are on the rise over the board. So the amount of tech solutions and bringing mental health solutions closer to individuals and really using tech to try and battle that kind of epidemic that's reaching us all, I think is very important. So I really try to look from somewhere I would love to see the innovation take place. Yeah, that's I think always a good question to an investor is that sort of you look at one of these amazing business plans and are you then enthusiastic about it because you think it will work or because you really want it to work? Yeah, now, of course, I think as an as an investor, you may want to make sure that it will work. And as an investor, I mean, we know exactly in every impact area where we would like to invest. So which where we believe the largest impact can be made. So we know we're targeting but we come across a lot of entrepreneurs who are activists and I love it. But some of them are really believers in wanting a radical change to happen. Yep. And that doesn't always mean they have the means in the business model to make it happen. But so and but as with impact entrepreneurs as with any of them are nine out of 10 fails, which is fine. So because they need to dream big. Otherwise, it's it doesn't work. There's so many issues that we need to solve yet. So let's come up with these unreasonable ideas and let's hope we get some of them to really scale. Yes. You're we're talking about saying, hey, you can do something really good and be financially successful. And, you know, for the reasons of having great employees and customers caring about build a really big business. But what now if you build a really big business if Swapy is super successful, and all of a sudden, you can sell the company and you can sell it for $2 billion to someone who really believes in your dream and your mission or for $5 billion to Amazon because they think it's a really good model. What do you do? Yeah, I think kind of when choosing any company kind of to partner with, I don't think it's super black and white that there's this let's say impact companies and then there's these evil companies. But it's really about kind of how can, for example, we as at Swapy, we can like establish our mission that is making refurbishment stream. So it's really not just kind of working together with the impact companies. But it is taking everyone on the ride. We have so little time left to solve this issue. So we really need everyone. So like, I think from a very practical standpoint, like, would partnering with someone mean that we can actually make more impact and scale further, and so on. But that's the win-win. That is a win-win. And that's an easy answer. It is a discussion we've had a lot, right? There's a question we get a lot from LP. So what happens? For one, you got to if we only invest in aligned models where the growth of the company leads to growth of the company. So that's the impact. Second, we will only invest if the company really puts their impact mission in their deeds of incorporation, which means and also in their shareholders agreement. So all these shareholders need to agree whether they're impact investors or not that this is relevant and this is going to be part of the exit conversation. It doesn't mean it's the only part of the conversation, but it has to be part of the conversation. And then, of course, I mean, we're minority investors. So the entrepreneur needs to decide where they want to go. And then it is actually never black and white. But if the company has a choice between a company that will pay half and a company will pay double that, but you know in that company that they will just kind of try to question you because you're trying to, you know, you're trying because their business model might lose out to you. So that would be a reason not to do it. We've never come across that. So we've always been in the win-win up till now. But it's a difficult discussion. But it's a discussion that is really important to have with the entrepreneur, even when you invest. So where do you want to exit? Where do you want to land up and make sure as an investor that you can help them land to that next step? To the right place. We don't have much time left. But let's talk about now we're facing a recession or we're in the middle of a recession. Does that mean anything different for impact companies? Is there special superpowers that can help you go through it? Or you're facing the same weather as everyone else? I think kind of everyone is feeling kind of what's happening right now. But I think companies that first of all have a product that really resonates with customers, whether it's businesses, consumers, etc. Those will be the companies that will thrive also next year. So for example, for us, our product is not only about sustainability, but it's really about affordability as well. So we think that kind of if we take the long term long term view, people will still be interested in purchasing more affordable and more sustainable smartphones. Yeah, I think it's it's the same for any entrepreneur. I think, for instance, the ones that are in in climate tech solutions, they will not have the most of them don't have a lot of problem. They will actually grow faster in this because this the urge for these solutions to grow to scale is much larger now. So there's a lot of opportunity for those. But then for others, it is more difficult to make the ones that are dependent on high electricity bills for the production there. I mean, so that's the same for any entrepreneur. And I think from a venture from an investor perspective, I see a lot of opportunities. I mean, we're in there for the long run. I don't think we're doing a lot of big exits next year. So but I think what we are intend what we intend to do is really create value in the long term and great amazing returns. And I believe these companies have that value and we will be able to prove it after this crisis. And as you said, you started this session with you've been through two crises. Yep, as an investor. There's like the question. No, exactly. It's it's you have to do the right things now. And then there is light at the end of the tunnel. And I much rather be in a nimble startup that can really take all the actions needed. Then at Unilever, where the storm hits you and you just can't move in any direction. So it's not going to be easy. But I think we'll be we'll be okay. Thank you very much. I think you shared great experiences with us. I've also heard that it's important for you that it's not that you guys are successful, but that you touch a lot of people and that they follow your success. So I kindly invite anyone who wants to know more to contact you guys directly and spread the good words and and thank you everyone for your attention. Thanks.