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Global impact startups on track to raise record levels of investment

Global impact startups and scaleups are on track to raise record levels of investment in 2020.

A new report marking the launch of the Impact and Innovation database, co-initiated by ImpactCityDanske Bank and Tech Nation, supported by Progress Tech Transfer Fund+impactImpact First InvestmentsGITAExponential ViewAnanda Impact Ventures and Planet+, shows that impact investment in startups is becoming mainstream, and startups are emerging to address every challenge area of the 17 UN Sustainable Development Goals.

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What is an impact startup?

Purpose and profit, tech for good, social impact, responsible tech. These terms are all used to describe the space where a company is aiming to create a positive impact beyond just financial returns. For the Impact & Innovation database, we consider an impact startup to be a company that is addressing one or more of the UN Sustainable Development Goals (SDGs). So far we have manually classified over 5,000 startups using this framework. Find more on our methodology, including how we address greenwashing, and core and side impact business focus, here.

The rise of impact-driven startups

It’s long been said that you don’t need to choose between doing well and doing good. It now seems that global startups and scaleups are finding validation in that claim. Global VC investment in impact startups is on track to reach €19B in 2020, up from just €5.8 B five years ago. Megarounds of over €250M are becoming commonplace in the impact space.

Chart showing global investment into impact startups and scaleups

The climate emergency is driving investment

A wide range of startups addressing the UN Sustainable Development Goal challenges are emerging, with some now achieving brand name status. Within Impact, Climate Action and Clean Energy are the most active startup investment spaces, with niches like electric vehicles (Arrival, Lilium), battery technologies (Northvolt, Blue Solutions), and alternative protein (Oatly, Ynsect) contributing to over €50B in investment raised globally since 2015.

visualisation showing the distribution of vc investment by UN SDG since 2015

The investor landscape

There are at least 60 dedicated Impact VC funds in Europe alone, but these are by no means the only players in the space. Impact VCs are increasingly finding co-investors in established VCs. And corporate impact funds are bringing serious fire power to climate and impact, with billions pledged for distribution.

Download the report on global Impact startups



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The new home of Impact and Innovation

Brilliant data has the power to accelerate entrepreneurship and innovation. It does so by inspiring people and enabling better decision-making – decisions about capital allocation and policy design. Data transparency can facilitate equal access to opportunity and better accountability. That’s why with ImpactCity, Tech Nation and Danske Bank we’ve created the Impact and Innovation platform to build an engaged community of founders, VCs, researchers and policy makers.

Enthusiasts can get inspired and find jobs. Startup teams can find investors and recruit. Policy-makers can inform decision making. Explore all the data from this report and more on the Impact and Innovation platform.

 

access the platform