The 2150 Impact Framework

2150 Impact Framework

The Impact Framework helps us evaluate the impacts and sustainability of our investments, informs our decision making and guides 2150’s due diligence on investments to ensure our investments contribute to our mission. A positive result from the Impact Framework is a key threshold for 2150’s investment committee.

How It Works

The 2150 Impact Framework helps to structure our due diligence process. Along each stage of evaluating a company and potential investment, we use the Impact Framework to ask key questions and assess performance across a range of impact and sustainability dimensions. As an investment reaches a potential signing, the resulting ‘impact score’ provides insight into areas where we feel a company excels and others where we can focus our support for improvement.

A. Minimum Threshold for Investment

2150 sets minimum standards to consider any company for investment.

1 Adapted from EU Paris Aligned Benchmark. 2150 will enforce all exclusion criteria under the regulation.

B. 2150 Impact Principles and Quantifying Impact

Companies meeting the minimum thresholds are then assessed against their contributions to 2150’s Impact Principles and Ethos. This includes quantifying a company’s impact within the sustainability objective to which it contributes.

(baseline unit impact — proposed unit impact) * (market uptake) * (Δ in baseline conditions)

There are a number of efforts in venture capital at the moment seeking to develop guidance and standards on projecting impact, with Project Frame from Prime Coalition of note. Being a part of this community is important to 2150, and we will continue to engage and incorporate best practices as they develop.

C. Considering Sustainability Performance

We strive to support companies that foster sustainability both through their products and the examples they set in their operations. We consider a company’s:

D. Signing Terms and Co-Investors

Last, 2150 considers the term sheet and investor community surrounding a deal. Our standard term sheets ask companies to measure their impacts, adopt a sustainability policy and strategy, develop a diversity policy, and onboard best ESG practices including on climate risk.

The final result of our impact framework is a thorough analysis of a company, its potential future impact, sustainability performance and areas to focus 2150’s support as the company matures.

Fostering Discussion and Collaboration

2150’s Impact Framework is a public document, as we want to foster a discussion within VC on how to effectively embed impact considerations into investment decision making. The ultimate marker of our success will be in our contributions to solving the climate crisis and associated sustainability challenges. We cannot do this alone, so hope to engage the VC community to enhance our approach to assessing impact in our investments.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
2150 - Constructive Capital

2150 - Constructive Capital

We provide Constructive Capital to technology entrepreneurs that seek to make our urban environment more efficient and sustainable