Investing in Startups with Social Impact – A talk with… Ananda Impact Ventures!
Ananda Impact Ventures is what is known as an ‘Impact Investment Fund.’ The VC for social entrepreneurs has an office in Munich and another in London. Ananda was founded in 2010 by Johannes Weber and Florian Erber. A third fund to the tune of 50 million euros was closed in 2018. The team of ten invests in young companies that have found solutions for current societal challenges. We wanted to learn more and spoke with Johannes Weber, founder and managing partner of Ananda Impact Ventures.
Please introduce yourself!
Ananda Impact Ventures is a European impact investment fund with offices in Munich and London. We primarily invest in impact startups in Germany, Austria, Switzerland and the UK. Initial investments run from one to three million euros and can later increase to seven million per startup. We typically invest in seed and series A rounds of financing.
Ananda Impact Ventures invests in social solutions
What are your preferred areas of investment?
We invest in companies that take on the major societal challenges of our day and age. Our fields of investment include digital health, education, ageing, future of work and sustainable consumption. We invest above all in B2B companies and focus on startups that already have initial sales and a business model.
Johannes, do very personal preferences sometimes also influence your investments?
You can never completely free yourself from that. Sometimes I feel particularly drawn to specific subjects due to my personal experience. For example, I always take a look at innovative technologies having to do with prosthetics because I was on a military mission in Kosovo in 1999 and saw so many people there who had lost limbs.
Investments are made in scalable business models that make a positive impact
What type of startup would you never invest in?
We don’t invest in startups with a niche that’s too specific or those without a scalable business model. Our focus is on market-oriented, sustainable and scalable business models whose main aim is to make a positive impact.
Do you scout out promising companies yourself or do you have consultants do it?
We scout out companies ourselves. In addition to conferences and industry events, we also regularly receive exciting recommendations from our existing portfolio and personal network.
Do startups need to be worried about you getting too involved?
The founder is always in the driver’s seat with us. As former entrepreneurs, we’re happy to act as active sparring partners and to offer our expertise, advice and network. What we don’t do is confuse the role of investor with that of an operator.
Which stage is the best time for startups to contact you?
Founders should have already entered the market and be able to show initial sales.
Deal closing? We like to move quickly!
After initial contact, how long does it take to establish a contract?
We know that fundraising costs entrepreneurs a lot of time and energy. That’s why we like to move quickly when we decide to close a deal. The process typically takes four weeks to four months.
To be successful, a startup needs to…
… have an “unfair” advantage. That could be in-depth expertise in the industry, specially developed technology, an exceptional network or a founder’s particular intrinsic motivation.
Tell us about a no-go factor in a pitch!
We have a tough time with founders who are already carrying on about exit fantasies during a seed investment. That indicates a low amount of emotional buy-in to us. On the flipside, if a founder is completely unable to imagine an exit, that’s also a warning sign for us.
When have you seriously miscalculated a situation?
We were unfortunately seriously mistaken about a founding team once. Another time, a company’s business model simply didn’t work. In the latter case, it really wasn’t the founder’s fault, and she has worked closely with us for years now in deal sourcing.
The trend of the year is…!
In the field of digital health, we’re currently taking a very close look at patient empowerment and related business models.
Munich startups: close to the needs of major B2B customers
From an investor’s standpoint, what does the Munich startup scene do well? What could be improved?
Munich isn’t as loud as Berlin. Nonetheless, establishing contact with the industrial sector and developing in conjunction with the needs of major B2B customers is something many Munich startups do extremely well. Some good examples of that are the companies we’ve invested in such as Company Bike Solutions, Verbavoice, Auticon and Media4Care.
Last but not least: Whom should startups contact if they would like to meet with you?
You can go ahead and contact our investment team. We’re all on LinkedIn. As an alternative, we’re always happy to get an email.
Munich Startup ist das offizielle Startup Portal für München und die Region, das von der Landeshauptstadt München entwickelt wurde. Mitinitiatoren bzw. Kooperationspartner sind die UnternehmerTUM, das Entrepreneurship Center der LMU, das Strascheg Center for Entrepreneurship (SCE) und die IHK für München und Oberbayern. Träger ist die Münchner Gewerbehof- und Technologiezentrum GmbH (MGH).