🚀 Building authentic impact, reinventing the gig economy, & more

Founders Factory Startup Bulletin #3 (October 2021)

“Created for founders, by founders”

👋  Welcome to the Founders Factory Startup Bulletin. Each month, we bring you a round-up of startup and investment stories, key learnings from founders, and insights from the Founders Factory team.

In this month’s newsletter:

• Tips for building sustainability and purpose into your startup’s mission

• A blueprint for reinventing the gig economy

• Our top reads—from talent spotting advice to the next clean energy frontier

• All the latest fundraising news, product launches, and investment updates from Founders Factory 

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💡 Key learnings for founders 

Tips for building sustainability and purpose into your startup’s mission

The focus on building ventures to address sustainability challenges has never been greater. The real question is—how can you do this authentically and effectively? We spoke to two founders from our accelerator programme—Cat Jones, founder of flight-free travel startup Byway, and Isabella West, founder of clothing rental platform Hirestreet and white label rental software Zoa—to discover how they build sustainability and purpose into the core of their businesses. 

• Deeply research the problem

Having a deep understanding of the problem you’re addressing will help you:

• Appreciate the scale of what you’re addressing—e.g. the carbon output of wear-it-once fast fashion

• Figure out the direction of your business—for Isabella, this helped decide between different models and approaches

“There’s a large grey area around what ‘good’ looks like,” Isabella West, Zoa

• Clearly identify and outline your values

This is something that should be clearly defined from the outset. For Cat, it needed stressing that purpose would always sit alongside profit at Byway. When joining Founders Factory, this underlined that they might not make certain commercial decisions that other companies would make. 

“Our values inform how we hire, which partners we chose to work with, and what to prioritise,” Cat says.

• Know what your expertise is, and be aware of your limitations

There’s no point paralysing your business through trying to ensure every decision is as impactful as possible. You’re better off understanding where you can have the most impact, and honing in on that. 

• Make sure it’s accessible

Ask yourself—is your product or service affordable to people at all price points? If not, then you’re missing out on driving change in a large segment of the market. You need to offer a direct alternative for customers: for Isabella’s business Hirestreet, this meant stocking clothing from more affordable and unsustainable brands like Asos.

• Pay attention to language and marketing

Here’s three easy tips for talking effectively about the problem your solving:

1. Use plain, obvious, universal language - terms like ‘carbon emissions’ and ‘net zero’ sound too technical; use terms like ‘pollution blanket’ and ‘irreversible’ that feel urgent and tangible

2. Create deep personal connections - show that climate change is something that will have an individual and personal impact on people, and incorporate this in your messaging. 

3. Tailor your message to different audiences - show that climate change is everyone’s concern, not just environmentalists’

• Build with a critical mindset

Create a culture where you encourage your team to constantly question and challenge the impact and effectiveness of the decisions you’re making.

To find out more about what areas you can target around sustainability, how to measure impact, and what investors are looking for, read the full article here. 

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🧠 Founders Insights

Reinventing the gig economy in five steps

Why has the gig economy become a dirty word? We’ve seen companies like Uber and Deliveroo entangled in employment lawsuits with their employees, a far cry from the original vision of the gig economy that promised flexibility and easy access to work. 

Shepper offers a new blueprint for gig platforms, one built around fairness and sustainability. Their platform allows ‘Shepherds’ (the name they give their users) to complete asset checking and data collection tasks in their local area. Founder Carl August Ameln reveals his insights for future founders looking to develop in the space. 

Here’s Shepper’s roadmap for reinventing the gig economy:

1. Build a community, not a crowd

We’ve always referred to Shepherds as our ‘community’, not a ‘crowd’. We wanted to create a brand that people wanted to identify with, and which anyone could join and feel a part of. We’re constantly looking at ways to foster this sense of community, in particular how Shepherds can help and support one another.

2. Integrate sustainability into the heart of your business

Gig platforms often pursue profit over environmental and social factors. At Shepper, a key part of our mission was to change the carbon-intensive model of asset checking, which often requires long car journeys. We’re local first—Shepherds are matched to local tasks within a certain travel radius, aiming to limit the length of journeys by car. We’re hoping to introduce green tasks, which are accessed only by bike, foot, or public transport.  

3. Treat your community as customers, not commodities

Our mantra is “customer first and Shepherd first”. This means making decisions that don’t exploit our community to increase profits. We pay every Shepherd the London Living Wage (£10.85 an hour), and as soon as tasks are verified, Shepherds are paid and can withdraw money on the same day. 

4. Make your platform as inclusive as possible

Our Shepherds are an incredibly diverse group, encompassing a wide range of ages, races, backgrounds, and abilities. We want Shepper to be a platform for everyone regardless of circumstances, which means our team is constantly available to support Shepherds until the task is completed and you’ve been paid. 

5. Listen to your key stakeholders

For us, that means listening to our Shepherds. We have examples of where Shepherds have given us feedback on something, and we’ve worked with them to improve our platform. We’ve also started bringing Shepherds into board meetings to share experiences of what works for them and what could be improved. 

Read the story behind Shepper and their blueprint for reinventing the gig economy

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🐦 Tweet of the month

BO (buggeroaf.eth) @buggeroaf

A small thread on why some founders raise $$ in seed rounds and some founders don't despite little traction. Caveat Emptor: Traction does NOT matter as much as VCs say in Seed / Pre-Seed rounds. /thread

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📚 What we’ve been reading

• Can direct listings really fix the IPO pricing problem? (TechCrunch)

• 20 underrated qualities to look for in candidates—and 50+ interview questions to suss them out (First Round Review)

• The energy future needs clean batteries (Bloomberg)

• The world-view changing drugs poised to go mainstream (BBC)

  • Find out more about our latest investment in technology startups in the psychedelics industry

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💸 News from the Founders Factory portfolio

• Karakuri has launched its Semblr robot at Ocado’s Hatfield headquarters, preparing hot and cold lunch for around 4000 staff

• We announced our investment into redefining mental healthcare through psychedelic-based therapy, partnering with Woven Science to build and grow technology startups

• Digital physical rehab platform On The Mend is launching a crowdfunding campaign, which you can pre-register for here

• We launched our Sustainability Seed Fund, in partnership with G-Force, building startups tackling sustainability challenges

• Circular economy startup Reath raised £312k in a pre-seed funding round, to help them create a digital infrastructure for reusable packaging

  • Read more about Reath and our circular economy investments 

• Cashback startup Upside released their report, The Tipping Point of Loyalty, looking into consumer spending behaviour across different verticals 

• Sustainable laundry startup Oxwash appeared in Forbes talking about their mission and latest fundraise

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🗓 Opportunities for founders

• Tech Nation Rising Stars (UK, applications close October 20th) - a startup and scale-up pitch competition in front of leading investors, influencers, and corporates

• Founders Factory Investor Showcase (London & Virtual, November 4th) - Showcasing 14 of our top startups in front of 100+ investors

• Power to LGBTQ Founders (London, November 9th) - For LGBTQ+ founders to meet top VCs and investors, and to take part in masterclasses run by the FF Operations team. Apply by October 24th

• ⭐ We’re hiring a Growth Lead ⭐ - Join our Operations team

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See you next month 👋

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The Founders Factory Startup Bulletin brings you a round-up of startup and investment stories, key learnings from founders, and insights from the Founders Factory team.