Impact Engine – Part 1
VERBATIM by Loop Lonagan – Investor and man about town,
as told to John Jonelis
Loop Lonagan here. Dis is somethin’ can change da world. It’s called IMPACT ENGINE ‘n’ it’s dare first investor showcase.
Already met one o’ da founders, Linda Darragh and she made a big-time impression on me. I saw dis gal charge-up a roomfulla sleepy thought leaders with da energy of an oxyacetylene torch. Ideas and plans fly off her like da Fourth o’ July. She’s the reason I’m here.
So I tear myself away from da great Funding Feeding Frenzy after way too much to eat ‘n’ a whole lot too much to drink. I stagger outa my cab into da Chase Auditorium to hear IMPACT ENGINE rev it’s cylinders.
(NOTE TO JOHN—I made merry after lunch at FFF. Words ain’t comin’ out da way dey should. Better clean up my copy for me. I’m gonna make a big effort to straighten myself out here. I see coffee at da other end o’ da lobby and I’m headin’ that way now.)
(NOTE TO LOOP—Your points come across nice and clear. I’ll continue to print it exactly the way you dictate it.)
What They Do
I got a hot cup o’ coffee in my mitt so lemme start feedin’ ya the goods: IMPACT ENGINE helps fer-profit startup companies make money by doin’ good things fer folks. I said FOR profit. I’m all fer dat. Dis is what you call Social Entrepreneurship.
(Sound of slurping coffee.)
Hey—if yer gonna earn a livin’, why not do it in a way dat helps some other poor slob insteada just yerself? Whaddaya think yer put on dis green earth for anyhow?
And if yer gonna help somebody, why not do it as a business ‘steada holdin’ out yer hand like some leach? Business is way better den charity ‘cause it supports itself. Teach a man to fish and so on. Dis is da future. Dis’ll change da world.
And demand! Hey—dare’s no shortage o’ people dat need help! And no end to it! Like I always say, I got it on good authority dat the poor will always be among us.
I still got them slashed knees from fallin’ in a pothole this morning. And it still don’t look stylish. Hey, dis ain’t no pair o’ bluejeans—it’s a $2,000 suit. So’s I look like a bum, but nobody’s gonna say nothin’ ‘cause I’m actually ready to write out a check. Day call it Impact Investing. I wanna make an impact.
(I slugged down three cups o’ this black stuff ‘n’ my eyes is buggin’ out. Must be espresso or somethin’. Anyhow, maybe the rest o’ this report’ll sound more coherent. But you know me. I studied on Wall Street and the Back Street. I ain’t no English teacher.)
(NOTE TO LOOP—You don’t fool anybody with that school-of-hard-knocks routine. The University of Chicago doesn’t hand out Masters of Finance degrees in back alleys.)
How They Do It
IMPACT ENGINE is a super-duper incubator that helps entrepreneurs launch ‘n’ win.
- They immerse ‘em all in a 12-week intensive program o’ workshops at the 1871 collaborative workspace.
- They hook ‘em up with a huge network o’ mentors, thought leaders, ‘n’ investors.
- They give ‘em brand exposure.
- They send ‘em out with a $20K kick in the pants. Seed capital.
(Hey, that rolled off o’ the tongue pretty good. Maybe espresso is better than beer. But don’t tell the guys I said that.)
First time I met Linda Darragh was at the Levy Entrepreneur Mastermind Group. A buncha sharp folks. Linda’s a gal from da University o’ Chicago Booth who’s workin’ at Northwestern’s Kellogg School o’ Management. That puts her in a real peculiar kinda position. And she ain’t lettin’ it go to waste, neither!
Turns out Linda usta have about ten titles. Couldn’t fit ‘em on a business card, so she dumped it all in one bucket. Now she’s the Executive Director of The Kellogg Entrepreneurship Initiative. Hey, one title fits better than ten. And it’s a helluvalot easier to say. Turns out the startup community’s heart is poundin’ real strong here in Chicago. But all the programs to juice these folks is fragmented all over the place. Should we glue ‘em all together?
I SAY NO! Insteada tryin’ to control all them different silos, Linda Darragh is coordinatin’ ’em.
BIG DIFFERENCE! After all—each one o’ them groups is independent and all of ‘em got somethin’ special to offer.
So I tell her she’s a black widow spider spinnin’ a big web. But turns out she pictures herself as a “weed.” I don’t get it, but if that’s the way she wants it, it’s okay by me.
So what exactly is this weed doin’? Hey—what ain’t she doin’? At Northwestern, she’s settin’ up the whole entrepreneurship curriculum—across the entire university. Already replaced all them courses with stuff that’s more up to date. AND online learning. AND other stuff beyond the classroom.
She says no more screwy mobile apps that already been done and ain’t goin’ nowhere. AND no more static business plans. Instead, a lean canvas. She insists that every business starts with hypothesis testing and only then fleshes out a business model. I like it!
She ain’t stuck to just one university neither. She’s cooperatin’ with the University o’ Chicago, IIT, DePaul, Loyola, and others. AND she’s reachin’ out to corporations too. AND a she’s got a big presence at 1871. AND she’s leveraging Kellogg’s worldwide alumni network along with ones from other schools. She’s buildin’ one powerful, cohesive drivetrain. I really like that!
I told ya this gal is a torch.
IMPACT ENGINE is one o’ her biggest projects, co-founded with Jamie Jones. Now Chuck Templeton’s in it up to his neck. These people all deserve alotta credit fer startin’ this highly unique incubator.
(Fifth cup and I feel great. Headin’ into the auditorium.)
Take a SWAG
Usta take years to make a good business. Now two kids in a dorm create somethin’ that goes national in no time. Web-based companies can test fast and fail fast. You can find out if it’s a go in 6 months! This is a big deal. You do all the testing before you sink in the big money.
That means classical marketing is dead. That’s what I said—dead meat—road kill. It’s dead ‘cause now you can test yer product in the real world faster ‘n’ cheaper than doin’ a formal marketing study. Look out Dr. Kotler—time to write another book.
Here’s the way it usta be: You do one o’ them in-depth marketing studies. That takes lotsa time and money and produces zero profit. Then by the time the Execs decide what to do, the trend already shifted nine times. That don’t work no more. Better to test in the real world, fail fast, then make yer adjustments and give it another shot.
Another new thing is Big Data. It’s a huge driver in the new way o’ doin’ things. It makes it possible to pick up on trends using simple web searches. Big Data also brings up lotsa big challenges. Maybe you got all the data in the world but how d’you visualize it? You gotta figure out the right questions to ask.
That all sounds like cross-disciplinary stuff, right? So IMPACT ENGINE is lookin’ for the right kinda people and helpin’ ‘em use all these new tools.
Yer head spinnin’ yet? Lemme lay it out in four simple steps.
Da Final Four
Here’s the short list on what Linda Darragh says you need to do:
- PEST ANALYSIS—(Politics, Economics, Social, Tech). You gotta identify the trends. Big Corps gotta innovate here and summa them is doin’ it. But it’s a whole lot easier fer a startup—that is, if you don’t trip over yer fat ego.
- DA CUSTOMER IS KING—What does yer customer need now? Keep talking to ‘em and keep adjusting to ‘em. Find out if customers is leavin’ and where they’s goin’. More than ever before, it’s all about the customer.
- TRACK YER COMPETITORS—What are them bums doin’ now? Are they gonna take you out? You gotta figure out the changing value chain and how it’ll affect you. It’s real easy to believe things is goin’ good—then wham—you get blindsided.
- TECH IS DA ICING—Fer early-stage funding, the Chicago success model is tech-enabled manufacturing—not pure tech. Lotsa opportunities ‘cause ever’body needs tech these days.
One more thing: Impact investing’s got a whole different timeline. Angels and VCs usually cash out in 5-7yrs. Impact Investing might take 10-15 years. Yeah, it’s a bigger horizon but we gotta put aside legacy thinking.
My batteries is runnin’ down again. I’ll get back to you later and show you what summa these new social entrepreneurship companies look like. Fer now, check out this great video about IMPACT ENGINE:
IMPACT ENGINE – www.TheImpactEngine.com
Ask a question: www.TheImpactEngine.com/Contact
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.Copyright © 2013 John Jonelis – All Rights Reserved