Every week Transition Earth is going to take a closer look at ‘ethical investors. We’ll speak to everyone from individual angels through to executives at corporate venture capital companies to find out how they are working to help attain global goals and the reshaping of the planet.
For the first interview, we spoke to Greta Monstavice of Katalista Ventures. The company has a Lithuanian heritage but is active across much of Europe and boasts personnel in several countries.
Greta describes the company is a ‘triple top line accelerator and advisory for startups working with them to make a positive impact on People, Planet, as well as making Profit.’ It runs a hybrid model, part accelerator part private equity provider.
Here she talks about how the company defines ethical capitalism, why some entrepreneurs become so focused on purpose that they sometimes forget profit and how Brexit has benefited startups in the Baltic region.
How long has Katalista Ventures been operating? What was the catalyst that made it happen, and what are the key problems you are trying to solve?
Katalista Ventures has been in existence since 2017, so a bit over three years. Both Alex Gibb, my co-founder, and myself had international experience and expertise with sustainability, innovation and startups. We worked together on a couple of occasions, and we always knew we would do something related to sustainability. Considering our skills and network we decided to start Katalista Ventures, which is effectively the first accelerator of its kind in the Baltics. We are a triple top line accelerator and advisory for startups and organisations aiming to fulfil their potential while making a positive impact on People, Planet, as well as making Profit. We also work with governmental institutions and NGOs globally to build capacity in the sustainability ecosystem, provide sustainable innovation advisory, and help develop resilience with a triple top line business model.
And what companies have you worked for in recent times? How have you helped them overcome their challenges?
We have worked with startups like Tinggly or Paysolut but also corporates such as Swedbank or Oracle.We look for ways to bridge challenges through innovation and create win-win scenarios where both the sustainability and financial aspects of the companies benefit. We use both our in-house expertise as well as our network of sustainability advisors to create tailored solutions. To give you a bit more detail on specific cases, we worked with BaltCap, a pan-Baltic private equity fund on a Clean Water hackathon to support sustainable water infrastructure, connect various sustainability-oriented startups, NGOs and the government to find innovative cross-sector solutions. And we also worked with Swedbank and the fintech community space Rockit to run the Rockit Impact Accelerator to support sustainable B2B startups in scaling their solutions with corporate leaders in various industries, including Elektrum, Swedbank, Telia and others.
And how do you define ‘ethical capitalism?’
Ethical capitalism is about transforming the business model in a way that creates positive impact, reduces the negative impact, all while being financially resilient. A lot of the time we see ethical capitalism in the context of shaming consumers into sustainability, but it is more about empowering consumers to have a positive impact with their consumption choices. A good example is our portfolio startup Tinggly, which encourages consumers to give memories, not stuff, and emphasizes the importance of building interpersonal connections. It’s about enjoying experiences while helping the planet.
Do you think the nature of entrepreneurs is changing? Are you seeing more founders focusing on changing society as well as creating wealth?
Definitely. Entrepreneurs now focus not only on changing society, but also helping the planet. We see a growing tendency to focus on impact and not only profit. But sometimes entrepreneurs can lose focus of their financials as they concentrate on creating impact. Our role as an accelerator is to support startups to balance the three priorities – People, Planet and Profit – and then maximise their impact with scale.
What does your portfolio look like in terms of niches? Is fintech the key area?
We have a good track record working with fintech and e-commerce startups, and we are open to collaborating across various industries. The principles of early startup acceleration are similar in different industry verticals and can be adapted to all startups in our portfolio, be it sustainable fashion, food, tech, or carbon management industries.
Has the nature of working with UK startups changed in any way post-Brexit? Do you still see the UK as a major hub for startups?
The UK is still a major hub for startups due to the sheer size of the ecosystem and their maturity in financing, including impact financing. It is a market we look up to and learn best practices from to adapt to startups we work with. During Brexit we got a wave of fintech startups choosing Lithuania to grow and develop in Europe. Their arrival and the new connections and exchanges that will be made will be great for our ecosystem.
We are seeing a lot of funds now being created for ‘impact investing.’ Is this here to stay? Or are all funds going to be putting impact investing at the core of what they do in the future?
Impact investing is picking up speed rapidly and is definitely here to stay. This is likely to become a standard in the future, while investments that do not have a TTL / ESG component will be phased out over time.
The three baltic states have a really strong track record in the creation and nurture of tech startups? What do you think are the main reasons for this?
An important aspect is the size of our market. Everyone is interconnected and motivated to be helpful to the ecosystem. This interconnectedness also helps to access high-level people in government and other organisations really fast.It’s a tightly knit and ambitious startup ecosystem.
