We’ve talked with Ciprian about sustainability trends that green startups and social entrepreneurs should focus on in 2023, as well as funding opportunities for them.
According to Ciprian, there are a large number of relevant trends in sustainability and climate. Just to name two of them, Ciprian mentions measurement & data for ESG reporting, including integrating advanced tech for sustainability, as well as circular economy opportunities.
You can read more on the development of the local ecosystem for green startups, the programs that SIS is preparing for 2023 and what Ciprian would do if he was a world leader in our interview with Ciprian Stănescu, president and CEO of Social Innovation Solutions.
Sustainability trends to watch in 2023
Ciprian Stănescu: The past years have brought, in terms of sustainability, various types of challenges, regulation and, at the same time, opportunities. Many companies, especially those that were already on the path to sustainability gained new clients, kept, and increased their shareholders and gave stamina and purpose to their employees.
At the same time, the start-up environment is starting to change around the world as data from the past years shows that investment in sustainable businesses gives better results than more classical ones.
ESG regulation is getting stronger and puts more pressure on large and, soon enough, medium business to adapt their business processes for a greener and more inclusive economy. The SEC in the United States is expected to bring even more ESG regulations for investors, the EU is pushing for non-financial reporting across the board and in the UK, the Plastic Packaging Tax is most likely going to transform supply chains at global levels.
It is crucial for companies, especially in the growth phase from start-ups to maturity, to start early on their sustainability metrics and embed them in their core business (not PR) strategies. Live data with strong processes in place to take tough decisions are necessary.
Dataphoria, a Greek startup for example, winner of Future Makers 2021 creates dashboard for companies to better understand their sustainability metrics overall – from social to governance and environmental emissions.
Measuring the way a company has an impact in its community, on the planet and for its stakeholders is key to a more sustainable economic growth.
When it comes to circular economy opportunities, especially for companies in production, distribution and retail, this year brings great opportunities. Tens of use cases of how to integrate circularity principles into a sustainability strategy can support entrepreneurs and boards to become part of a future in which we consume less materials or produce less new materials and one in which circularity brings more profit than expected to our businesses and the planet.
The EU Circular Economy Action Plan, part of the EU Green Deal, in force for almost 3 years is a great opportunity for companies to understand also the regulatory frameworks ahead. As the EU taxonomy on sustainable activities entered effect on January 1st this year, we are expecting to see more circular economy incorporated in strategies and investments.
How to integrate circularity, how sustainable production can be financed or how to develop sustainability strategies for SMEs are 3 of the 10 modules of the Sustainability Academy, a large e-learning platform to be launched in late March by SIS.
What green startups should focus in on in 2023? Investing in easy-to-use tech solutions for their business processes, understanding more the investment opportunities in Europe and the US (especially with the IRA climate investment opportunities) and securing the future skills they need for growth (either finding new employees or upskilling current ones).
How to get more traction as a green startup founder in 2023
Ciprian: Founders should look at alternative sources of financing, including lending from commercial banks looking for green investments.
If we look at European-based founders, I think it is a good year to look into financing opportunities from large European institutions like the European Investment Bank and the European Investment Fund, as well as expanding their investment outreach for funds outside their country or region.
Apart from financing mechanisms, I would argue that green startup founders should look more into integrating better measurement technologies in their production or distribution processes, from smart inter-connected sensors to better data management so that they become more attractive for investors.
They could also become pro-active and begin their non-financial reporting even if for many it is not (yet) mandatory.
Funding for green startups
Ciprian: It is a very good year for many startups to attract investment, especially because of the macroeconomic and geopolitical situation. As Europe is heading towards an accelerated energy transition due to the war in Ukraine, there is a growing need for technology solutions – from storage to hydrogen and from solar to distribution channels, agritech and mobility.
I feel we are moving in a reversed situation compared to some years ago. Investors need to get the attention of green startups founders, not necessarily the other way, including institutional funders like EIB and the EC funds mentioned before.
The local ecosystem
Ciprian: As a rather moderate optimist, I am very enthusiastic about the future in this field in Romania. We have seen in the Social Innovation Solutions incubators in the past years a different type of entrepreneur – one for which a sustainable and impact driven business is rather the normal, not the exception.
Together with over 20 actors – from incubators to accelerators and from VCs to universities – we are gathering in conversations these days to better understand how can we all better serve this mission of boosting the impact driven entrepreneurial ecosystem.
Be it deep-tech or social-driven ventures, we see an ecosystem of change that is becoming mature also fuelled by a new wave of capital – from EU and VC funding to an equally important type of capital: human capital, in the form of advisors or expert hours put forward by experiences business leaders.
SIS: Initiatives for green startup founders and social entrepreneurs
Ciprian: We are accelerating our entrepreneurial educational programs this year and the opportunities for green and social entrepreneurs.
Future Makers, our largest incubator enters its 6th year, supporting over 60 start-ups from 6 CEE countries with a top-notch digital incubator engaging mentors and experts from 15 countries, investors and over 70.000 euro equity-free up for grabs.
Starting with 2023, we are offering in Future Makers 3 verticals: sustainability & climate; healthcare & wellbeing; and open innovation.
As startups grow, the need for education, networks and strategy grows as well. The 3rd edition of Transformator takes place in the autumn, designed as an intensive executive & strategic educational program for SMEs over 2 years of age.
They exit the 3 months program with a clearer sustainability strategy, better designed KPIs and a transformation plan for the future. Bonus: access to investors and awards in consultancy hours with some of Europe’s best consultancy companies in sustainability.
Our biggest initiative this year is to be launched at the end of March: a personalized e-learning platform offering sustainability business education to 10.000 SMEs in Romania.
The Sustainability Academy will offer to SMEs various types of learning – from a self-paced learning experience with 10 modules to choose from as per their needs, to a sustainable business making toolbox that can also be used in their teams, to live webinars with top experts and various financing & supply chain integration opportunities from our partners.
Also, we aim to offer a stage for the entrepreneurs changing our shared future. In 19-20 October we host in Bucharest Climate Change Summit, a global conversation platform focused on climate solutions where we aim to engage top Romanian and CEE green startups and connect them with European, Israelian and American innovators and investors. We are proud to have had over 780.000 online viewers last year and aim to engage 1 million viewers at global level in 2023.
In Future Summit, a large international event on the intersection between technology and sustainability, we also offer valuable space for exposure for green startups in 8 cities across Romania, Greece, Bulgaria and Serbia this year.
If you were a world leader, what would you do about climate change
Ciprian: I recently had the opportunity to interact with various leaders that fall into this ”public system” category during the inaugural forum of the European Investment Bank in February and in our Climate Change Summit last year.
Many of them have the necessary ambition and vision to tackle the grand challenges of climate crises. Not that many have the necessary tools and power at their disposal. As we were saying last year on a billboard in Times Square, NY – climate change has no borders. Unfortunately, as a world leader I would not be able to do all that I would like to.
As climate issues are a cross-border challenge that needs to be tackled in cooperation with state actors that we might not like, courage is not what we need. So as a world leader, I would rather focus on identifying the best ways to work better with all relevant actors – be them politicians, businesses, civic communities, etc. – to build ecosystems of systemic change focused on large scale inclusive solutions for current and future climate challenges.
It might sound like mumbo-jumbo what I just said. But there is no ”one” simple solution to what we have ahead of us for the next decades. Our future actions need to be connected, collaborative and co-created – otherwise we will wake up 10-15 years from now with even more disbalances in weather & climate patterns.
Climate knows no borders. Neither our solutions should.
Any thoughts?