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Posts Tagged ‘venture capital’

Here’s a story about venture capital with a do-good focus.

Sacha Pfeiffer writes at the Boston Globe, “Among entrepreneurs, there’s a dreaded place called the Valley of Death. That’s where startup companies go when they run out of funding before making money on their own, and it’s an especially common fate for clean-energy startups, like manufacturers of solar panels and wind turbines. …

“But what if that early-stage, high-risk financing could instead come from philanthropists, who aren’t driven by profit? Later, traditional investors could step in and supply continued funding.

“That’s the concept behind PRIME Coalition, a year-old Cambridge nonprofit that has pooled $1 million from wealthy donors, including Hollywood actors Will and Jada Pinkett Smith, as seed money for its first investment: an energy storage startup company. …

“PRIME rethinks the traditional definition of charitable work and charitable giving. Its founder, 30-year-old MIT graduate Sarah Kearney, argues that companies whose products or services reduce greenhouse gases are doing a social good, just like soup kitchens and homeless shelters, so they should be able to receive philanthropic funding. In this case, the social benefits include conserving the environment and fighting climate change.

“The group searches for early-stage alternative energy companies … then locates philanthropists or socially minded for-profit investors to fund them. Those could include charitable foundations, investment offices of wealthy families, and donor-advised funds. …

“Peter Rothstein, president of the New England Clean Energy Council, said philanthropic funding ‘can make a significant dent’ in filling the need for early-stage capital for clean-tech companies.” More here.

It is not unheard of for philanthropy to put its investment dollars into companies that provide a social good. Read about the Heron Foundation’s decision to do so some years back in “Expanding Philanthropy’s Reach: Mission-Related Investing,” here.

Photo: Lane Turner/Globe Staff
PRIME Coalition founder Sarah Kearney says that companies whose products or services reduce greenhouse gases are doing a social good and should be able to receive philanthropic funding.

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I took a tour of Mass Challenge today, an accelerator incubator program. And what is an accelerator incubator program? you ask. An incubator helps small businesses get launched and grow. An accelerator helps them get launched and grow really fast.

The program I visited may be the biggest anywhere. It has a whole floor of a gorgeous new building overlooking Boston Harbor, which the landlord has provided rent-free at least until 2014. It has zillions of sponsors and supporters, including the mayor and the governor, who don’t always see eye to eye on other matters.

Enter by tomorrow to be in the running for this year’s program and the top prize. Every entrant, whether chosen for the program or not, gets three to five professional reviews. You can enter from anywhere in the world. Caveats: there is an entry fee of $200, and your startup has to have made less than $1 million so far. Click here to enter.

From the website: “MassChallenge is the largest-ever startup accelerator and competition, and the first to support high-impact, early-stage entrepreneurs with no strings attached. Benefits for startups include:

* 3 month accelerator program. World-class mentorship and training, free office space, access to funding, media and more.
* $1M in Cash Awards. $4M+ in-kind support.
* Open to all. Any startup can enter, from anywhere, in any industry.
* No equity taken. No restrictions applied.”

And while we’re on the subject of small business, I also saw a great presentation about a new City of Boston website that walks people through all the things they need to do to get a business started in Boston. A wonderful, user-friendly site.

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