Tag Archives: impact investing

MAY THE FOREST BE WITH YOU

Neil Kane TUsing Whole Trees in Building Construction

Neil Kane

If there was ever a way to combine high tech and high touch as John Naisbitt stated in High Tech, High Touch, his 1999 follow-up to his 1982 bestseller Megatrends, “embracing technology that preserves our humanness”, WholeTrees Architecture & Structures of Madison, Wisconsin epitomizes it. WholeTrees is an innovative company that has hit it out of the park in terms of innovating on technology while providing a substantial impact return, all while having one of the most gorgeous and aesthetically pleasing product lines you’ll ever see.

WholeTrees uses trees as turn-key structural systems in commercial and residential building construction. Until you see the photos, however, the description doesn’t do justice to the warmth of their offering.

Building-Interior 1000

Myrick Hixon EcoPark, LaCrosse, Wisconsin

The co-founding team of Roald Gundersen AIA, an architect, and Amelia Baxter, in partnership with the Forest Products Laboratory of the U.S. Department of Agriculture (USDA) Forest Service, have developed a process that allows them to cost-effectively grade, engineer and manufacture the small trees removed from routine forest thinning (called small diameter round-timber), and use the timber as patented trusses, beams and joists in building construction. In doing so they turn forest waste into a sustainable and high value building material.

Round timber is an abundant and renewable resource. The timber is sustainably harvested then dried and treated to protect against shrinkage and pests. Pound for pound as strong as steel in tension, unmilled timber requires less than two percent of the energy of concrete and steel materials for processing and transportation.

IMG_1094-1000

YMCA lobby, Dallas, Texas, 2015

“We are positioned to occupy a large niche in the approximately $13 billion U.S. sustainable structural systems market,” says Amelia Baxter, president. WholeTrees is a woman-owned business with pending Woman-Owned Business Enterprise (WBE) certification.

Last week they announced a $1.8 million debt and equity financing from investors who characterize themselves as “impact investors”. Impact investors seek environmental and social returns in addition to financial returns. WholeTrees also receives on-going grant support through the USDA’s Small Business Innovation Research (SBIR) program.

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Neil Kane Portrait

Neil Kane writes about leadership and turning innovations into businesses.

This article first appeared in Forbes.com

and News from Heartland

Copyright © 2016 Neil Kane

Photographs: WholeTrees Architecture & Structures & Neil Kane

 

Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link. This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2016 John Jonelis – All Rights Reserved

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Filed under big money, Cleantech, Economics, Education, Entrepreneur, Entrepreneurship, Entrepreneurship and Politics, Impact Investing, Innovation, Innovation and Culture, Invention, investor, new companies, Social Entrepreneur

CLEANTECH TRUTHS DEBUNKED

Pigs TGenerally Accepted Truths of Cleantech Investing – Debunked

Laurance K. Hayward – The Venture Lab

It is generally accepted in Cleantech investing that:

(1) the companies are capital intensive,

(2) there is a sustainability premium associated with buying the companies’ products and

(3) the adoption of the companies’ technologies requires a change of behavior.

All three can slow adoption and negatively impact scalability and internal rate of return. Certainly this can be true for many Cleantech companies, but it isn’t true for many others.

There has been an evolution and broadening in the definition of Cleantech, call it 2.0. Cleantech 1.0 involved funding solar, wind, battery and biofuel technologies. Many drew parallels to biotech investing in which large sums of capital and extended timeframes preceded product viability. Then add in the need to build factories and infrastructure. The faint of heart don’t change the world.

Often these 1.0 technologies required the end user to pay more for their use, many required subsidies, or incentives to be competitive. For example, there is a generally accepted “sustainability premium” associated with receiving power by solar relative to coal or natural gas. The technologies also required a change in behavior, such as installing new infrastructure on the roof of your building. Ironically, many of today’s demand response applications require the consumer to monitor or use energy in response to new information (i.e. creating more work).

So, these three so-called truths have validity, but now let’s debunk them with some real life examples in the world of Cleantech 2.0.

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Self-Healing Polymers

Every year billions of dollars in corroded metal hit the scrap heap. Some gets recycled. Besides filling our landfills with pollutants, these metals and their coatings require enormous inputs of energy to create and recycle. (Been to a steel mill lately?)

Various coatings are added to metals to help them last longer; there have been remarkable improvements. The old rust-bucket automobile is a rare sight today. But, coatings get damaged after which corrosion ensues. What if the coating could last several times longer? It would reduce the need for chemicals used in cleaning and recoating metals and keep more items out of the scrap heap.

Today, self-healing polymers can be added to a coating in small quantities to prolong the life of the coating and underlying material. Manufacturing can be outsourced to established suppliers and the paint can be applied like any other without a major behavioral change. The sustainability premium is small relative to the performance gain.

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On-Demand Technology

When a 500-bedroom hotel wants to heat water, how do they do it? They typically keep large tanks of water hot with a boiler system. These systems are large, expensive and redundant. They keep large quantities of water hot even during times when little is being used.

Enter on-demand technology, which only heats water when it is being used and has no storage tanks. On-demand technology is now available for use in commercial and industrial environments. Interestingly enough, the system can be less capital intensive than the system it replaces. It can cost the hotel the same or less to buy and install, avoiding the sustainability premium. And, it doesn’t require a significant change in behavior as it uses the same natural gas and connects in a similar fashion. It actually can be a little easier to install due to a smaller form factor and cooler exhaust.

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Chemical Advances

Beta Glucan is used to promote animal (and human) health and as an alternative to the potential overuse of antibiotics in our food sources. The conventional method of production involves extracting beta glucan from yeast. It is costly, messy and involves harsh chemicals.

There is now a proprietary method to produce Beta Glucan from algae in sterile fermentation tanks (not too dissimilar to the ones used to brew beer). It is a cleaner and more energy efficient method of producing Beta Glucan and results in a product with greater purity and lower cost.

The sustainability comes with a discount rather than a premium. The end product is used essentially the same requiring no change for the end user. And the production tanks are inexpensive – just as it is relatively inexpensive to start a craft brewery today.

These are just three examples of technologies that contradict commonly accepted truths; there are many more.

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Cleantech 2.0

Cleantech 2.0 isn’t better—it’s just different. Many disruptive and important technologies come with aforementioned truths and our world needs the investors who support them. A Tesla automobile doesn’t exist without major capital investments and a willingness of consumers to change the way they source fuel for their cars. (The sustainability premium is dropping).

The objective of this article is to cast light on generally accepted truths that have scared away many an investor or acted like blinders covering the eyes of others. The unaccepted truth is that there are numerous options to positively change the world without having to settle for a less attractive investment profile. As Cleantech investors ourselves, we don’t necessarily want too many investors back in the game, but a few additional kindred spirits wouldn’t hurt.

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Larry Hayward 2

Larry Hayward is a Chicago entrepreneur.

This article was adapted from TheVentureLab blog

Copyright © 2015 TheVentureLab

Photos – Larry Hayward

VentureLab logo

theventurelab.blogspot.com

This article appeared in News From Heartland

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Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link. This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2016 John Jonelis – All Rights Reserved

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Filed under angel, angel capital, angel investor, big money, Chicago Ventures, Economics, Entrepreneur, Entrepreneurship, Entrepreneurship and Politics, Impact Investing, Innovation, Innovation and Culture, Invention, investor, new companies, vc, venture capital

KILLING IT

Impact the World TImpact Engine – Part 8

By Jeff Segal – message therapist

Less than a year ago, I asked a prominent figure in Chicago’s startup community about local investors’ interest in the social enterprise model.

She told me flatly, “No one cares.”

Well, they care now. Six months after the first Impact Engine Investor Day, five of the eight members of the initial cohort have closed a round of funding. If you’re keeping score at home, that’s 62.5%, compared to 6% or less for startups in general, according to Forbes.  Impact Engine and social enterprise are killing it – killing the competition.

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Surprise

Portapure, one of the first group of grads, builds individual water treatment devices for developing nations. The company recently closed angel funding worth potentially $300K. I didn’t see that one coming. What did I miss?

“Other filtration technologies aren’t specific to developing countries’ needs and environment,” says founder George Page. “They are high-end products developed for the first world, some with pumps that require electricity or batteries. They’re useless in developing countries. Portapure units work on gravity, with no complex mechanisms. Anyone with a 2nd grade education level can understand how to use them.”

Page explains that Haitians, who on average earn less than $1,000 a year, can spend as much as $3.50 a week on drinking water—but can buy a Portapure unit with a microfinance loan and pay it off in 4-5 months with the savings. With more than 4 million Haitians lacking access to clean water, that’s a promising market.

Before Impact Engine, Page says he was offered $50,000 for half of his company. It’s now valued at $4 million. He thanks Impact Engine “…for access to folks who understand that sustainable social impact is a true value-add, at the forefront of changing how business works.”

Impact the World courtesy Technori.

Legitimacy for the Whole Social Enterprise Space

Collaborative Group closed on funding of $550K. They connect retail brands with artisans in the developing world—for example, a line of Rachel Roy/FEED handbags is now sourced from India. Founder Kathleen Wright describes the impact such projects create: “We’re employing five artisan groups, and they’re all now sending their kids to school. It really enables them to have different dreams for their kids and themselves.”

But it’s not all social impact—Wright projects that her revenues will double this year.

ThinkCERCA got funded to the tune of $490K and launches its platform this August. They provide curriculum and tools that teach the critical thinking and literacy skills essential to the new Common Core State Standards—standards 49 states already adopted—standards that nobody knows how to implement.

For starters, they’ll reach more than 5,000 students between grades 4 and 12 in both city and suburban school districts. “It helps teachers and kids collaborate and construct new knowledge,” says founder Eileen Murphy, “because you just can’t teach someone to write using multiple choice questions.”

Aside from its feel good vibe, Murphy points out a concrete advantage of the social enterprise model in the tech community: “The social impact focus makes a big difference (for a startup company) competing for engineers.”

Regarding Impact Engine, Wright says, Chuck Templeton’s  guidance—how can you put a price on that? It gives legitimacy to the whole social enterprise space.”

Murphy adds, “Their energy, intelligence, support, and influence can’t be replicated, no matter how brilliant you are or how hard you work.”

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Two More Funded

Asadi, which markets inexpensive feminine hygiene products in rural India, has since moved back to India to build and train its sales network of 100 female entrepreneurs.

Pangea —which, for reasons unstated, didn’t even pitch on Investor Day—has closed on more than $1 million to finance its multiplatform, worldwide money-transfer solution.

Elizabeth Riley, Impact Engine Program Manager, explains the kind of company that fits the incubator’s profile: “We don’t accept companies with a Buy-One, Give-One business model,” she says, referring to companies that just donate to charity every time someone makes a purchase.

That’s not the social entrepreneurship model. A true social enterprise creates its social benefit from the exact same business activity that generates its sustainable revenue. It’s a model that’s gaining credibility and winning converts, and the eight members of Impact Engine #1 are establishing Chicago as one of the world’s top social enterprise centers.

So—who’s next?

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About the Author

Jeff SegalJeff Segal   Twitter Bird @MsgTherapist, works with entrepreneurs as a Message Therapist, translating great ideas into messages that connect with customers, partners and investors. He also writes at BrokerSavant  and We’re Not Expecting Any Surprises. Contact him at mt.jeffsegal@gmail.com

This article can also be seen at Technori

Photo credits – Technori and Jeff Segal

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Look for Part 9 – Coming Soon

Back to Part 1 – WHAT’S GOOD

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Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link . This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2013 John Jonelis – All Rights Reserved

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GIVE IT AWAY

Impact Engine – Part 5

VERBATIM by Loop Lonagan – Investor and man about town,

as told to John Jonelis

Impact Engine

Loop Lonagan back at Impact Engine Investors Day. The Chase auditorium’s packed with angel investors and venture capitalists AND philanthropists that’d rather invest in self-sustaining ventures than just dump their money down the old rat hole.

Shayan Nahrvar of Raise5

Shayan Nahrvar of Raise5 at Impact Engine

Y’know, it ain’t easy fer these companies to get this far. Most startups just grub fer money. These guys gotta make money BY DOIN’ GOOD. And these is da ones Impact Engine picked to do the job. Let’s sit back and talk about one o’ dem.

Logo large

Do what you love to support the causes you care about

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Raise5 founder, Shayan Nahvar, (pronounced SHI-an nah-VARR) is a real likable and well-spoken young man.

Shayan Nahvar of Raise5

Shayan Nahvar of Raise5

No sooner does he start his pitch than up pops a video. And whoa–it’s Richard Branson! Richard Branson is pitching Raise5!

I didn’t see no celebrity endorsements at FFF this morning, but these guys at Impact Engine pulled it off. Makes me feel like they can pull off most anything.

This’s a whole new crowdsourced fundraising channel fer charities. Raise5 turns yer ordinary purchases into donations. AND they do it cheap. NGOs spend 35 cents on every dollar they raise–just to raise that dollar. That don’t make no sense to me. Raise5 can bring that down to somewhere in the 8-15 cent range ‘n’ make a profit doin’ it! That’s self-sustaining.

I can hear summa you Scrooges in da back grumblin’ and groanin’ about what da hell’s da purpose o’ just givin’ it away. Hey, lotsa companies wanna give back. And lotsa regular folks too. And this ain’t just fer Microsoft ‘n’ them guys. Artists and all kindsa folks can get in on the action. And the secret of it is this:  It’s not just da charity that benefits.  It’s the giver, as you’ll see:

Say you wanna support The Nellie Thursday Home For Old Dollsa legitamate charity. Maybe you got a garage band that does a revival act of an old group like The Monkeys or somethin’–one o’ them that’s better to ferget.  Maybe you know a few more bands that ape awful old acts. Hey–all together it could be a great show!  So youse guys put together a concert and have a whale of a good time while you raise money fer Nellie.  Here’s how it works:

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Raise5 Website

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How to become a freelance fundraiser:

  • Ya slide on over to the Raise5 site
  • Ya plug in yer service or product. 
  • Ya set yer price and da charity that gets da proceeds

That’s it! Raise5 does the rest.  Whadaya waitin’ fer?

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.Raise5 Sample

Here’s a real example:  Look at dis screenshot detail. Adam is willin’ to blast yer weblink to his 20,000 Twitter followers fer five lousy bucks.  The money goes to da WSPA t’ help dem furry creatures.  John’s gonna foam at the mouth when he sees dis ’cause he’s tryin’ t’ promote his new novel ‘n’ dis is the way to do it.

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Here’s another offer:  Fer a measley five bucks, you can get a great Raise5 Offercaracature like dis one.  Money goes to Doctors Without Borders.  How can you lose?

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Dis is a win/win/win setup:

  • Charities get a new way to raise funds.
  • Individuals ‘n’ companies get a new way to create impact ‘n’ social change.
  • Customers get to buy something great, knowing their money’ll make a difference.

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Check out dis COOL VIDEO:

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Da Business

Hey, there’s 1.6 million not-fer-profits in the good ol’ US of A just waiting t’ be served and 4000 right here in Chi-town. Raise5 takes a transaction fee from every sale, so the more money they make the more impact they have. What more do I need to say?

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CONTINUE TO PART 6

Go back to Part 1

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Da Contacts

Raise5raise5.comRaise5 logo

3234 North Richmond Street,

Chicago, Illinois, 60618

Crain’s Chicago Business covered this event and ran a nice article: www.chicagobusiness.com/article/20121206/BLOGS06/121209884

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Impact Enginewww.TheImpactEngine.com

Contact Linda Darragh – L-Darragh@Kellogg.Northwestern.edu

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Images courtesy of Raise 5 and Impact Engine

.Impact Engine large

Whadaya Think?

You’re invited t’ leave yer opinion. No, you don’t hafta leave yer name or email or nothin’. Just be polite. And keep it clean.  Click the COMMENTS command at da bottom.

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Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link . This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2013 John Jonelis – All Rights Reserved

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Filed under 1871, angel, angel capital, angel investor, big money, Characters, chicago, Chicago Venture Magazine, Chicago Ventures, CORE Insight Story, Entrepreneur, Entrepreneurship, FFF, Impact Engine, Impact Investing, Innovation, Innovation and Culture, Internet, Internet Marketing, investor, Kellogg, loop lonagan, Marketing, new companies, philanthropist, philanthropy, pitch, vc, venture capital

THE TWO WHEELS OF CHANGE

Impact Engine – Part 2

VERBATIM by Loop Lonagan – Investor and man about town,

as told to John Jonelis

Impact EngineLoop Lonagan here at IMPACT ENGINE Investor Day. This is the new Chicago incubator fer companies that do well by doin’ good—and doin’ it profitably! Think of it—we’re gathered here to get richer by makin’ all them other poor slobs around the world prosper! This I like!

The keynote speaker is FK Day. (He calls hisself  FK fer short.) And he tells us a story that knocks us outa our seats. This is a real unusual chain of events that speaks about the virtues of capitalism doing alotta good by helping folks raise their own well-being.

Buffalo Bicycles

Here’s the shortlist:

  • The story starts with SRAM that makes high-end bike parts.
  • Then FK starts World Bicycle Relief—a not-fer-profit.
  • That leads to Buffalo Bicycles—a self-sustaining company.

Impact Investing

The Chase Auditorium’s packed with serious investors. Them’s the only kind they let in the place today and this hall seats over 500 of them rascals. They’s all squealin’ ‘n’ squirmin’ to get a piece o’ the action. Sheesh—I ain’t seen so much money in one room since I…well I ain’t s’posed to talk about that so lemme move on. I’m here to do summa that Impact Investing, just like da rest o’ these clowns. But first lemme get back to the keynote speaker

(Note to Editor—All that coffee I swilled down‘s got my eyes buggin’ out ‘n’ I feel a whole lot more coherent. I’m gonna give you the skinny on this thing. But I want you should cut me some slack—just in case I get something out o’ order.)

(Editor’s Note—Nobody’s perfect. I’ll print it just as you dictate it.)

Okay, so dis story starts after FK pioneers bicycle shifters ‘n’ brakes at SRAM. His stuff’s in high-end bikes AND in all the big international races. Even poor disgraced Lance Armstrong uses SRAM components so you gotta figure that FK knows a thing or two about bikes.

Hey—this is a Chicago company, okay? Don’t get no better ‘n’ that, right? Well actually it does as you’ll see in uno momento.

Bicycles WBR 1

World Bicycle Relief

Remember that big tsunami in Indonesia? FK and his wife go there to lend a hand. They’re lookin’ for a better solution than the NGO relief organizations. So they asks people lotsa questions.

Turns out nobody can earn a living or make any economic progress ‘cause there’s no transportation. Everybody’s on foot. That ain’t too efficient. There’s kids spendin’ six hours a day walkin’ to school ‘n’ back. Mothers carryin’ groceries long distance. And get this—businesmen haulin’ their wares to market 5 or 10 miles on foot.

You think da rush hour here in Chicago eats into yer day? It’s nothin’ compared to this. This is no way to do business. This keeps folks in poverty.

The Power of Bicycles 3

FK’s a bike guy, so he shows up pre-loaded with the natural solution to the problem. He runs experiments and finds out alotta things. Turns out a bicycle can increase the income of a poor family in a big way. Looks like it’s the single best way to fight poverty in these primitive areas.

So he creates the not-fer-profit organization, World Bicycle Relief, which is a real big deal. They partner with WorldVision and alotta other organizations.  They give out 24,400 bicycles in Indonesia.

Bicycles WBR 2

Africa

FK starts a buncha 9-day trips to Zambia to fight HIV/AIDS and creates a special bike for it. Bicycles WBR 10

His folks first task is to assemble their bikes so’s they can get around. Their last task, before they leave, is to turn over their bikes to the villagers.

Bicycles WBR 9 FEELING GOOD

FK gives out 90,000 bicycles this way and learns a lot more about the problem.

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By now he’s got three well-defined areas he wants to impact:

  • Education
  • Healthcare
  • Economic development

Bicycles WBR 3

I think education tugs at him strongest.  Kids in these countries gotta travel a real long way to school and still have time to do chores not to mention homework.  With bicycles, they can get to school more often.  That builds up the whole culture by givin’ these people a future.  Givin’ ’em hope.  Summa these folks wanna be teachers, doctors, engineers.  Somethin’ as simple as a bicycle can make that happen.

Lemme get you started with a terrific video. Have a look at it ‘n’ then I’ll tell you more.

Pretty good stuff, doncha think? Bottom line—bikes carry more weight farther and faster than shoes. Bikes get kids to school, people to clinics, and they get businessmen to markets!

Bicycles WBR 11

FK tells the story of a dairy farmer in Zambia. With a bike, he can get to the co-op twice a day insteada just once.

That instantaneously doubles his income! 

Summa these guys mount homemade cargo boxes on these bikes and use ‘em like trucks.

Bicycles WBR 6

According to FK, the most powerful bike in the world is one in the hands of a mudder feedin’ her family or a fadder making a buck fer his family or a kid gettin’ an education to claw his way outa poverty. All o’ these takes transportation. And education is real important. You gotta learn readin’, ‘rightin’, and ‘rithmetic and how to speak yer language da right way or yer never gettin’ nowhere in dis here world.

Bicycles WBR 7

Buffalo Bicycles

Lemme go back to the hardware development phase. FK takes this jeep trip down them things called roads in Zambia. Whadaya think he sees? Busted bikes in the ditches ever’place he goes—every brand ‘n’ model on the planet. Says it looks like somthin’ outa The Andromeda Strain. (That’s a movie in case you fergot.)

Bicycles WBR 8These bikes come from well-meaning charities. But it’s all wasted. People in Zambia take to callin’ ‘em Chinese Junks. Off-the-shelf bikes is way too flimsy fer this kinda terrain.

So whadaya think the average lifespan is for yer typical off-the-shelf bike? 30 days! That’s it! And there’s no way to fix ‘em neither! Too many different brands. No parts. No mechanics.

FK figures what they need:

  • Standardized bicycle
  • Standardized parts
  • Real, real rugged
  • Trained mechanics
  • Supply Chain

Bicycles WBR 14 THE BIKE

The Buffalo Bicycle is a rugged design like no other. It can withstand rough roads while carrying a load o’ trade goods to market.

Here’s a video of FK in Africa riding the roads with folks:

Da Business

Charity’s a good thing.  But how do ya make it self-sustaining?  How do ya make it grow like a hockey stick?  You turn it into a business.  Business can be a helluvalot more powerful than an outstretched hand.  A little capitalism can be good fer da soul and FK’s a capitalist at heart.  

FK sells the Buffalo Bicycle to third-world businessmen at a profit.  That makes the project self-sustaining.  He trains and supplies mechanics.  And that maintenance network is self-sustaining too. So far they got 124,754 bikes out there where they can do some good. 

He shows us graphs ‘n’ charts. He’s gonna be building 100,000 bicycles in eight African-based supply chains in 2015.  This program is scalable and sustainable.

Bikes from website 2

Remember all that research I told you about? FK makes a key point about that. He learned everything he ever needed to know from the end user. We need to stay deeply in touch with these people. The answers almost always come from there.

Bicycles WBR 13 Wrigley FieldAnd to me, the amazing thing is that he went and figured out da problem and da solution ‘n’ engineered such a wonderful outcome.  He bootstrapped all o’ this starting with lotsa fund-raising drives like the annual Wrigley Field Road Tour which is a part of Chicago Cubs Charities. 

Here’s a candid video of FK thanking his volunteers after a small fundraising drive–one of many:

Next up is a company called ThinkCERCA. Meanwhile, check out summa the other articles about Buffalo Bicycles below.  Ω

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CONTINUE TO PART 3

Go back to Part 1

More Reading

Wrigley Field Road Tour

http://worldbicyclerelief.org/pages/wrigley-field-road-tour

World Bicycle Relief on Wikipedia

http://en.wikipedia.org/wiki/World_Bicycle_Relief

Article in Forbes

http://www.forbes.com/forbes/2010/0510/creative-giving-sram-zambia-charity-armstrong-bicycle-economy.html

BBC Article in TON

http://timesofnews.co/2012/03/15/can-the-buffalo-change-africas-bicycle-culture/

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Da Contacts

FK Day

FK Day

World Bicycle Relief website  http://worldbicyclerelief.org

WBR on Facebook  www.facebook.com/worldbicyclerelief

SRAM Logo

SRAM Corp.  http://www.sram.com/

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IMPACT ENGINE website  www.TheImpactEngine.com

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[ Photos and video courtesy of World Bicycle Relief ]

Impact Engine

Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link . This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2013 John Jonelis – All Rights Reserved

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18 Comments

Filed under 1871, angel, angel capital, angel investor, big money, Characters, chicago, Chicago Venture Magazine, Chicago Ventures, CORE Insight Story, Economics, Entrepreneur, Entrepreneurship, Entrepreneurship and Politics, Impact Engine, Impact Investing, Innovation, Innovation and Culture, Invention, investor, Kellogg, loop lonagan, Social Entrepreneur, vc, venture capital

WHAT’S GOOD?

Impact Engine – Part 1

VERBATIM by Loop Lonagan – Investor and man about town,

as told to John Jonelis

Impact Engine

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 just poured a second cup.  Real strong stuff.)Impact Engine logo

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.) 

 

The Weed

Linda Darragh

Linda Darragh

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.

Dr. Philip Kotler

Dr. Philip Kotler

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:

  1. 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.
  2. 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. 
  3. 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.
  4. 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:

 

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CONTINUE TO PART 2

Go back to Shark Tank Meets the Apprentice

 

Da Contacts

IMPACT ENGINE – www.TheImpactEngine.com

Ask a question:  www.TheImpactEngine.com/Contact

Impact Engine.

Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link . This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2013 John Jonelis – All Rights Reserved

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