This week, we have stories about Cotopaxi.
one of a group of companies destroying the myth that impact-oriented companies can’t grow large, and Zane Ventures
L’argent a une odeur
This week, as I was working on a story about Too Good To Go, an app that aims to curb food waste, I interviewed the CEO, Mette Lykke, and one of its funders, Alexandre Mars, a serial entrepreneur an founder of the investment fund blisce.
Lykke is Danish and Mars is French. Too Good To Go operates across Europe and the United States. When the company went out for a financing round of about $50 million, there were dozens of funds lined up that wanted to invest, according to Mars and Lykke. The company was growing fast, heading to profitability and has a strong case for climate impact (food waste generates methane).
So Lykee and the company leadership had lots of investors to pick from. Guess what she asked Mars as one of her filtering questions: Where does your money come from?
In France, they say: “L’argent a une odeur,” Mars told me. That translates to “money has a smell.” To create a new world where companies genuinely seek to do good and and make a profit, everyone needs to be aligned, from limited partners to venture funds to entrepreneurs.
This to some extent contradicts the old way of thinking about business and giving, in which you make money any legal way you can, and then, if you’re a generous sort, you give it away. Philanthropy washes away the damage you might have done to the environment, to your employees’ mental health, as the CEO of a cigarette company or as the CEO of an arms dealer, for example.
In today’s world, companies (their leadership, in reality) have choices about the people they work with. I haven’t seen that selective power exercised often in the startup world, probably because most founders operate in a scarcity mindset when it comes to capital. Startup founders who have been beaten down in a world that (for the moment) venerates capital over ideas and labor may not realize they’re at the vanguard of a change and a new world, where ideas and labor are more valuable than capital.
Good ideas and business models that generate profits and change are much rarer than capital, so entrepreneurs should come to the table with their own requirements for partners. And one requirement, if you care about systemic change, could be “LPs that I’m comfortable with and that are aligned with our ultimate purpose.”
If you have one of those good ideas, recognize your power and ask where the money is coming from. That’s another way to change world. Walk away from the money whose smell you don’t appreciate, and let them know why you’re doing it.
L’argent a une odeur.