It’s difficult not to be inspired when talking with Sarah Cone about the work being done by Social Impact Capital’s portfolio companies. Since raising Fund 1 in 2019, she’s been working to identify entrepreneurs who are developing solutions to everything from climate change, food scarcity, water desalination and even carbon capture diamonds.
We left our “5 Questions with…” discussion with Sarah feeling a little more hopeful about the world.
Q: Tell us a little bit about Social impact Capital.
SC: Social Impact Capital (SIC) exists to support social impact startups from the earliest stage. We’re often the first check in and sometimes we’re the only check in the beginning. We’re looking for sublimely ambitious entrepreneurs that believe they can make a ten billion dollar business that also has a massive social impact in healthcare or the environment or really anything that solves one of the world’s largest problems.
We have a lot of really interesting companies in our portfolio. One recent investment is in Totus Medicines, a platform that can design covalent drugs. Covalent drugs are the most effective drugs on the market because they bind to their target and they don’t fall off. Other types of drugs will bind and then fall off and then bind and then fall off making them less effective. Right now, Totus Medicines is working on PI3Kα, one of the most important cancer targets that exists. It’s involved in 40% of all cancers and the existing drugs mutate around the cancer so they tend to be the deadliest forms of cancer. Currently Totus is in Phase 1 testing meaning the drug is actually in patients which we find very exciting since we invested when it was only an idea. We were the first investors and the only investors in the seed round as well so it’s one of those companies that would not exist without SIC taking on that early risk.
We also incubate companies. One is an alternative social network called Column focused on high-quality information. The second is Trident Desal, a new desalinization technology that’s the cheapest in the world for really really, salty waters – seven times saltier than the ocean.
Q: How are you finding these entrepreneurs or are they finding you?
SC: It works both ways. We’re a very research-based firm. We do reports on specific problems – right now we’re working on one related to water scarcity and we’re working on one related to chronic illness – where we examine what the problem really looks like. We identify the key players and organizations and what solutions are out there. In doing that, we get a sense of what company has the most promise to actually solve that problem. Oftentimes we do that and then we go out and we find companies.
Additionally, I’ve been working in social impact venture for a while, and I have a giant network that constantly refers entrepreneurs to me. I describe my inbox as the most inspiring place in the world because literally I wake up every morning and there are emails from 200 really passionate entrepreneurs who have solutions to the world’s problems.
Q: What makes you and NVNG a good mutual fit?
SC: Social Impact Capital believes that the most important startups in the world can exist anywhere, including the Midwest. NVNG is a beacon of venture capital in the Midwest and it’s incredible to be connected to them which, in turn, connects us to a whole community in the Midwest.
Q: What’s your take on the Midwest ecosystem?
SC: I think the Midwest ecosystem is still emerging, but I believe it’s going to end up a really fertile ecosystem because Midwestern values are startup values. Midwesterners are can-do people that just get in there and get stuff done. They are honest, straightforward, ask smart questions, are really earnest and care about outcomes. Those are the types of people that make good entrepreneurs.
Another area that we’re excited about is reshoring American manufacturing and obviously the Midwest is the location of whatever dwindling manufacturing knowledge we have in America. So, we hope to be a part of continuing to revive manufacturing in the United States.
Q: What make you passionate about what you’re doing or really proud?
SC: We invest so early when these companies are really just ideas so seeing them grow up is one of the most exciting things in the world. It’s like watching your children grow up. One company that we invested in, Emitwise, is a carbon accounting platform for the manufacturing sector. They just signed an exclusive partnership with CBRE which is the largest real estate company in the world, and they are using Emitwise for all of their carbon accounting. CBRE went through an extraordinarily rigorous procurement process that made the contract incredibly hard to get but it validates that we invested in the right solution. It’s gratifying to see a company that was only founded three years ago – again, we wrote the first check and were the only check in the pre-seed round – being used by this major player.
Similarly, we have a company called Voyage Foods. Voyage Foods is future-proofing our favorite foods. Chocolate, coffee and peanut butter, for example, are all foods that are really affected by climate change. Voyage Foods makes substitutes for these foods that taste exactly like the food, but uses different ingredients. Their chocolate tastes exactly like a really high-quality chocolate and what’s wonderful about that is that they’re healthier, they’re better for the environment and they’re also cheaper. Walmart was doing a pilot with them in about 300 stores and Walmart just announced that they sold so well that they’re putting them in 1300 stores. It’s fantastic and, again, this is a company that was founded just two years ago.
It’s these types of business results and recognition for these important companies and their work that get me excited.