Adopting cleaner, more resource-efficient lifestyles is no longer the preserve of deep green environmentalists or those with sufficient disposable income, but is now accessible and affordable for an increasingly broad demographic.
On the back of the explosion in use of high speed mobile internet and the entrepreneurial drive that has fostered a raft of new digital delivery models, there is an unparalleled opportunity to rethink how goods, services and – more generically – resources are bought, used and disposed of on an individual and community scale.
When this is set against the backdrop of diminishing public spending and a renewed interest in alternative corporate structures and financial systems, we at Nesta have come to the conclusion that the time is right to start supporting the creation and scale-up of business models that are designed around the needs of users at both an individual and community level.
There has been a lot of focus on cleaner technologies on the supply side but the time is right to start looking in earnest at the other end of the sustainability spectrum, towards innovations that support individuals and communities to utilise local resources to drive cleaner more efficient lifestyles from the ground up.
We have embarked on an eight-year journey to find and invest in the most promising social ventures which will have a tangible effect on the positive social outcomes we have set for our impact fund, Nesta Impact Investments, while also delivering a financial return.
Examples of the types of opportunities include collaborative consumption models, group buying initiatives, crowdfunding platforms, community participation and ownership models, domestic or community generation projects, micro-agriculture systems – and more that I am yet to discover.
The fund will invest in organisations that can have a material impact on supporting an ageing population; the attainment, employability and wellbeing of children and young people; and the social and environmental sustainability of communities.
These are long-term, complex issues that are accentuated by reductions in public spending and increasing need, creating a fertile ground for innovation and new approaches to the delivery of products and services.
The third of these themes – community sustainability – is probably the hardest to define and to measure, not least because people have varying definitions of both terms but also because there is a multitude of possible outcome measures.
That said, we feel that this theme presents a rich seam of investment potential. We are seeing an increasing flow of ideas, concepts and businesses which leverage technology advances made over the last decade around internet and mobile communication technologies to deliver benefits directly into the hands of the user through cost savings, increased income or – more intangibly – creating greater social links within a defined community setting.
It is easier than ever for individuals to rent out their idling assets (for example, ladders, drills, cars) or under-utilised skillsets into local markets. They can find a willing home for products they no longer need or want; benefit from the collective buying power of like-minded people; invest small or large amounts in return-generating projects; monitor and modify energy usage; or even turn homes into a mini-power plant.
More than ever before, individuals are able to participate in systems, platforms or services which were previously hard to access in a timely or cost-effective manner regardless of postcode, income, ethnicity, gender or age.
At Nesta we are fortunate to encounter and support some truly inspiring individuals, companies and organisations that are developing such ideas into viable businesses. It is our intention with the impact investments to find and invest in such organisations, helping them to deliver on the promise of their offerings and to reach as broad a demographic as possible to ensure the benefits of the innovations are enjoyed by everyone.
Alex Hook is an investment manager at Nesta
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