Impact & Learning Report 2019

IMPACT +
LEARNING
REPORT

2019
Dear friends,

In the year that London was named the best city in Europe to grow and develop tech for good, BGV continued to go from strength to strength.

2019 saw us receive a record number of applications for our programme and we completed more investments in a single year than ever before.

In April we made news with the UK's first ever Tech For Good SEIS and EIS Fund, which closed at £0.5M. Building on that success we'll be closing our second fund this April also.

Our managing partners Melanie Hayes and Paul Miller OBE
2019 saw us receive a record number of applications for our programme and we completed more investments in a single year than ever before.
We continued to work with industry leading partners to broaden the tech for good movement including the Future of News partnership with Nesta and DCMS as well as collaborating with fellow B Corp impact investors on an event for purpose-driven family offices.

External recognition of BGV's pioneering work came in many forms. We were recently named one of the UK's top 25 VC firms by FT-backed Sifted, meanwhile it was an unexpected delight as Paul was awarded an OBE for services to startup investing.

We also worked on better defining BGV's direct impact and developing our impact methodology, including aligning ourselves with the Impact Management Project and undertaking a BGV team diversity and inclusion survey - all of which we hope you enjoy finding out about in this report!

And our investment performance continued to strengthen. We ended 2019 with our portfolio valued at 1.9X cost in terms of realised and unrealised value. 20 companies account for 86% of our portfolio's unrealised fair value – a sign of good diversification.

Looking ahead, 2020 marks the start of the ten-year countdown to the achievement of the UN Sustainable Development Goals. Now is the time for meaningful action and scalable innovation. With the proliferation of technology, the rapid growth of impact investing and the demand for purposeful business, tech for good is perfectly positioned to do just that and we're excited to be at the forefront of fueling the movement.

All best wishes,
Melanie & Paul
IN MEMORY OF GLEN MEHN
2019 brought one big low - our friend and colleague Glen Mehn sadly passed away in May. He was a co-founder of BGV, and helped create the prototype programme and write the proposal that got Nesta to invest in our first cohort in 2012. Glen supported so many of the ventures that have gone on to become big successes. He's already deeply missed and will continue to be so for many years.

Impact Investment integrity - is tech for good the answer?
Impact investment is in its hockey stick phase. According to the Global Impact Investing Network (GIIN), the amount of money classified as impact investment is doubling year on year. 2020 may well see it surpass the trillion dollar mark. However not all types of impact investment are created equal.

At their worst some 'impact' funds are simply existing funds that have been rebadged and rebranded. As large financial service companies recognise rapidly increasing customer demand for 'values-aligned' investment opportunities, the risk of 'impact washing' rises - buyer beware.

GIIN co-founder and CEO Amit Bouri says "As the industry grows, we need to be sure it scales with integrity—ensuring good intentions translate into real impact results." So what exactly is the best way to deliver these results?

We believe the answer lies in technology. With four billion internet users worldwide, the existing infrastructure for digital solutions allows for rapid growth and reach. This is important because with only ten years left to achieve the UN's Sustainable Development Goals (devised to ensure a positive future for people and planet), time is of the essence.
While existing tech giants have proven the ability to rapidly reach billions, none of them were built with positive impact inherent to their business models. Arguably, reverse engineering the 'for good' into existing tech behemoths would take longer than to build new and genuinely purposeful tech for good giants from scratch.

So if we want the biggest companies of 2030 to be delivering real change, we need to back these companies now. By combining the power of technology with the intention to solve the world's biggest challenges, tech for good can be counted on to deliver the impact in impact investment.
A year in the life of BGV
JANUARY
JANUARY
Launch of the WorkerTech podcast with Tech for Good Live

Partnership with Wellcome Trust and Big Society Capital, connecting researchers with mental health and wellbeing startups
MARCH
MARCH
Impact Investing for Family Offices – BGV hosts an event for family offices with fellow B Corp impact investors Bridges, Resonance and WHEB

Our programme partnership with Facebook culminates with the LDN_LAB Chapter 2 Deep Tech for Good Showcase.
APRIL
APRIL
We raise £0.5M into the UK's first Tech For Good SEIS and EIS Fund
MAY
JUNE
JUNE
We welcome three venture and impact experts to our board and IC
JULY
JULY
BGV takes part in Diversity VC's Future VC programme, welcoming an intern from an underrepresented background to the team for one month
SEPTEMBER
SEPTEMBER
Launch of the research report on startups for a better mental health as part of a programme with Wellcome Trust and Big Society Capital

Spring 2019 Demo Day with 200 attendees

'From founder to impact investor' – we host an event with Tribe Impact Capital for successfully exited founders interested in impact

Launch of the three-month Autumn 2019 programme
OCTOBER
OCTOBER
Trip to the US to host a panel at the leading impact investing conference SOCAP and to build our US co-investor network
NOVEMBER
NOVEMBER
Partner with Nesta to launch the Future of News Pilot Fund
DECEMBER
DECEMBER
Autumn 2019 Demo Day with 250 attendees
AWARDS
Finalists UKBAA Angel Investment Awards Accelerator of the Year

Winner Inclusive Tech Alliance
Diversity and Inclusion Team of the Year SME

BGV CEO Paul Miller receives an OBE for his work in startup investing

PRESS AND MEDIA
BGV coverage included features in: The Times, BBC, Sifted

Portfolio coverage included features in: The Guardian, FT, TechCrunch, Forbes, Telegraph

APPEARANCES
Collectively we've spoken at over 100 events about BGV and tech for good, including at Unbound.London, SOCAP, FundForum, The Telegraph Technology Intelligence Live.

We were also involved in mentoring teams from the UK and India through DCMS' Go Global programmes, and under-represented and/or impact-driven founders through YSYS Foundersdoor, OneTech, Black & Good, FastForward, TechHub, Digital Catapult Augmentor Programme.
Doing more to B the change
We're proud to be among the first UK businesses to certify as B Corps in 2015 and be part of a community that has grown to include over 3,200 companies worldwide meeting verified standards of social and environmental performance, transparency and accountability. Our latest verified B Impact Score is 94.7.
Benchmarking BGV - our impact class
To assess our impact as an investor, we use 'Impact Management Project's 'Impact Class Matrix', which categorises investors based on the impact of their underlying assets and level of contribution.
BGV's investment model, which solely focuses on investments in early-stage tech for good ventures means that 100% of our assets contribute to solutions (more on our investment thesis in the 'Portfolio Impact' section of the report). As all ventures would initially go through our programme and are offered life-long support on completion, BGV is also characterised by high levels of engagement in its portfolio's success. This combination places us in the C6 segment of the matrix.
Leading by example
One of our core principles is that diverse teams perform better. This belief extends beyond our portfolio ventures. We actively implement measures to ensure that BGV itself supports people from all backgrounds and 2020 marks the first year when we started reporting on diversity and inclusion metrics within our team.
How do we compare to the VC industry as a whole? Download the full report to find out.
Leading the charge on tech for good
We've been at the forefront of tech for good investing since 2012, building a world-class launchpad for our founders to grow and scale their businesses. In a rapidly changing world, with a climate crisis and increasing inequalities, we shifted our investment thesis to be more outcomes-driven. All the companies in our portfolio classify as contributing to a Sustainable Planet, a Better Society and/or Healthy Lives.


DIVERSIFYING OUR DEALFLOW
We are committed to making ourselves available to speak to all founders, no matter what their background or network may be. Worrying trends in the VC industry – less investment into female-led teams, warm introductions to funds leading to 13x more likely successful conversions – meant that founders from under-represented backgrounds are at a significant disadvantage. That's why we continue to run the tech for good meetups, host regular drop in sessions as well as open Q&A events closer to programme deadlines to maximise opportunities for ambitious founders to meet us and learn more about our offers.

For both our programmes in 2019, we met 94 individuals through drop in sessions, and another 129 at BGV events and 180 who we sourced proactively. We are typically the first investor in our companies and certainly the first stop on a VC trajectory. True to our principles, being early means we can positively impact the attitudes towards and diversity of teams who continue to receive funding and hopefully, result in better businesses.
OUR FLAGSHIP PROGRAMME


The lifelong support we offer to our portfolio starts with an intensive twelve-week programme designed to super-charge our tech for good ventures. To date, we have run 14 programmes supporting over 127 early-stage tech for good ventures.

During the programme we help our founders develop a lean and human-centered approach to their products and services. The workshops we run are delivered by the BGV team, expert mentors from our network and industry leaders. Overall, our programme is here to give founders the best start on their journeys of launching and scaling their tech for good businesses. We were delighted to receive an NPS score of 80 - defined as 'world-class' - for our most recent programme.

We are always looking to improve our support offering to our portfolio. In the last programme for example, we partnered with Doteveryone to help startups identify potential unintended consequences of their products and services. We also ran a session focusing on founder mental health and wellbeing. We'll continue to adapt our programme and ensure that it serves as a launchpad for our teams to become the very best tech for good ventures.
PLUGGING THE GAP WITH FOLLOW-ON FUNDING

Our investment model expects that companies will continue to raise capital in order to scale rapidly and with purpose. We recognise the difficulty that comes with securing early-stage rounds and try to aid in filling that gap with follow-on investments of circa £50,000 at pre-seed and £100,000 at seed stage.

At each investment stage, we run a due diligence process to understand how the company has evidenced both their commercial strategy as well as performed against one or more positive changes for society and/or the environment. As businesses grow and more investors come on board, we must believe that the founders continue their best efforts to preserve their social or environmental mission and are also starting to think about potential unintended negative impacts.

In 2019, we made nine follow-on investments, four at pre-seed and five at seed stage. While we don't lead rounds, we often commit early and do our best to bring on another investor who will.

In 2019, 13 of our portfolio ventures went on to raise a total of £13.7 million in follow-on funding, from both impact-focused and traditional firms.

This brings the total of further investment raised by our portfolio to £80m.

"You all took me seriously as an entrepreneur and for that, I can't thank you enough."
Harrison Moore, Founder of earwig (Spring 2019)
Sharing our portfolio insights
A message from our impact expert Amanda
From the earliest days of my career in impact, Bethnal Green Ventures taught me that it's on each and every one of us to shape what is possible.

BGV supported and invested in entrepreneurs who were told old, expired mantras again and again: "choose between financial and social returns"; "focus only on your shareholders"; "grow for the sake of growth". They backed businesses determined to prove there was another role for tech in the world beyond optimizing clicks.



BGV's portfolio has shaped what #TechForGood means – both by backing good tech and demonstrating the good that tech can create in the world. As a new non-executive Board Member at BGV, I'm incredibly proud of this impact report. The team has thrown their time (along with some heart and soul) into creating a new precedent for what's possible in impact measurement and management at the portfolio level. They take the time to listen to stakeholders, ask the tough questions and share their journey transparently with the world.

I hope you, like me, take a bit of inspiration from this year's report – learning from our approach, and helping us improve every single day so we continue to shape what's possible in 2020 and beyond.

"BGV's portfolio has shaped what #TechForGood means – both by backing good tech and demonstrating the good that tech can create in the world."
Amanda Feldman, Board Member
Board Member
Our impact methodology
We started gathering data from our ventures as early as 2013, which puts us in a unique position: we seized the opportunity to analyse trends across numerous metrics and implement industry recognised frameworks within our investment thesis to anchor impact across our portfolio.

As many will know, impact measurement is not always straightforward. In our case, we have been lucky to work with founders solving a huge variety of problems but this range also made it difficult to create a reporting mechanism that would allow each venture to show its own version of impact. For example, we would love to include more in- depth demographic data on our portfolio teams and their products' users. However, we realise that given the early-stage of our ventures, most do not collect this information or are unable to share it.

Despite the challenges, we have made important steps towards refining our methodology. We aim to anchor impact into every step of our investment process, from initial screening at the programme stage to providing follow-on funding with the expectation that our ventures will adhere to varying levels of evidence throughout their venture lifetime. Given the early stages of our ventures, we use Nesta's 'Standard of Evidence' to determine how confident we can be that an intervention is having a positive impact in our reporting, and mapped our active ventures against the SDGs.
In the most recent iteration of our reporting survey, we have more closely aligned ourselves with the Impact Management Project (IMP). We have already been asking our portfolio to report on their team composition, target users, location, outcomes and commercial figures. We now also ask questions on ventures' contribution towards targeted outcomes, their key risks and perception of BGV's contribution towards their overall impact.

The inclusion of 'commercial figures' in this list might seem unusual but BGV's investment model has always been closely linked to both driving impact at scale and commercial success. To collect the data, we send out a quarterly reporting form to our portfolio with an average response rate of 81.5% in 2019. As all data is self-reported, it is naturally difficult to verify and is prone to errors. To mitigate these risks, we review all data and ask ventures for further information if we notice any inconsistencies. We also supplement the reporting data with quarterly company updates with the BGV investment team, which gives us a more qualitative understanding of each venture's situation and allows us to spot any potential inaccuracies in our data. A breakdown of our reporting question categories can be seen in the endnotes of the report.

However, our journey doesn't stop here. While we have made a number of steps towards collecting more data across IMP's impact categories, we would now like to introduce further measures to share this evidence with our stakeholders. As an example, we would love to dig deeper into our portfolio's alignment with the SDGs and showcase exactly how our ventures are contributing to solutions. We will also continue working with our portfolio to encourage more uniform and rigorous impact measurement practices across the board.

BGV in numbers
All data as of 31st December 2019
127 teams
invested in since 2012.
73 companies
are currently active
61% of ventures
we worked with do not believe they would have received the same or better support from another organisation.
Overall NPS of 68
which is considered 'Excellent'. 'BGV Team support' listed as the most common reason for a Net Promoter Score.
Our 2019 active companies split by theme
Some teams sit across multiple themes
14.4%
A Sustainable Planet
49.2%
A Better Society
36.4%
Healthy Lives
For more insights and data into our portfolio performance and impact, check out the portfolio insights section of the report.
Venture stories
Read about our ventures Aparito, Musemio, The Nu Wardrobe and Run An Empire on their journeys to scale.
Fueling the Tech for Good movement
In 2019, research from Nesta on 60 European cities revealed London as the top city for growing and developing tech for good. They looked at indicators across six themes – funding, skills, civil society, collaboration, infrastructure, and diversity and inclusion.
London ranked highly across all themes and we're extremely proud to have contributed to that not only by investing into ambitious tech for good ventures, but also by connecting the dots in the ecosystem and convening the largest tech for good meetup in the UK which now boasts over 9,000 members.

We certainly hope that our meetups are a platform for people to connect, learn and explore all that. Here's a short snapshot of what we've done in 2019.
8 meetups 561 people
We ran 8 meetups in 2019 that were attended by 561 people. We varied the format quite a bit, with panels, talks, learnings sets, citizen assemblies, workshops and more.
Great partnerships
We partnered with our friends at #YouEqualTech to bring you an event about tech powering the circular economy, with the Cyberdelics Society to host a Citizens Assembly about radical civic tech and hosted two events as part of Mozilla Festival all about responsible AI.
1,484 people
19 speakers
joined the London Tech for Good meetup group bringing it to a total of 9,192 at the end of 2019. From 19 speakers overall, eleven identified as women.
THANK YOU NOTES

As always we would like to thank our investors and LPs for their continued support – without their support we wouldn't be able to help all the amazing early-stage founders coming through BGV's doors. A big thank you goes out to our mentors and partners, to our Board members, Investment Committee and our portfolio companies driving change and making the world a better place.


Autumn 2019 teams at the start of the programme