By Sarah Drumm, Sifted
Investors are taking sustainability solutions seriously. So what should founders make sure they're getting across to VCs when they meet? Greta Monstavice, cofounder of Lithuanian accelerator and fund Katalista Ventures, which focuses on the “triple top line” of people, planet and profit, filled us in.
Focus on the scale of the problem. “One [pitching] framework is to tell your story, then tell a story your audience can relate to, and then go wider and tell the story of what the future looks like with this amazing, brilliant solution,” Monstavice says. “But with sustainability, it's not a personal story — it's global. The biggest questions that investors will ask are: is there really a problem? How big is this problem? And is there anyone who’s willing to pay for it?”
Explain why your customer will bite. “If you’re [targeting] a market that’s at the beginning of its sustainability journey, we’d suggest focusing on selling points like [how you can help boost] employee engagement, customer loyalty or profitability, which are three things that are very important for any business,” Monstavice says. “This is how you bridge sustainable thinking to businesses that aren’t quite there yet.”
Offer a painkiller — not a vitamin. “One of the most crucial things we ask startups: are you a painkiller or a vitamin? All of the nice-to-haves [vitamins] get cut from company budgets as soon as Covid or another crisis hits." “If you offer a painkiller, and you're solving a real problem, you’re in a much better place to survive and be more resilient.”
A clear path to profitability is important. “In a meeting, you have to prioritise [what you talk about], and I would prioritise showing that you have a good business,” Monstavice says. “Because if you don’t have sophisticated financials, you’re not going to be able to scale your people and planet impact.”
You don’t have to use the S word. “I’ve met businesses that don’t really communicate themselves as sustainable,” Monstavice says, noting that some startups worry it may put investors off. Instead, they focus on the business model. “It’s maybe not entirely right, but at the same time it’s a good exercise for any startup — you have to [demonstrate you are] financially sustainable.”