A Venture Capital Fund With A Social Impact Heart – How Is That Possible?
The Relentless Venture Fund embraces a hybrid venture model: a profit driven, venture capital, health fund with a social impact heart. We are a double bottom line fund.
Digital Health & Data—The Enablers
But how is it possible to be a true venture capital fund that delivers venture-level returns as well as social good? It depends on how you measure social impact.
We believe the secret is with an evolving healthcare paradigm enabled by data usage; explosive growth in volumes of data created by individuals are now fueling sustainable digital health strategies. Incredibly, over 90% of the world’s data was generated in just the last two years. Stop and think about that.
The last two years have produced nine times more data than all human history before it. Data of that scale presents formidable challenges, but also tremendous opportunity. Relentless team member Shane Luke, and industry expert in artificial intelligence believes that “AI offers the promise of extracting all the useful signals from all of the noise and turning the incredible resource of human data into things that make people’s lives fundamentally better. The intersection of these massive technology waves creates one of the biggest opportunities to invest since the rise of the internet, specifically, the possibility of shifting healthcare into a preventative practice, where every person can understand and manage their own well-being.”
Preventative Health, Proactive Health and General Well-Being
Advances in sensors, data capture and algorithms have accelerated our collective ability to measure and be proactive about personal health management.
Fueling the world’s attention on prevention and proactive care, one of the United Nations’ global Sustainable Development Goals is for everyone to spend more resources on Good Health and Well-Being as a strategy to transform our world. The UN declares that investment in prevention and proactive treatment strategies is the path to reducing the prevalence of non-communicable diseases such as cardiovascular disease and diabetes; investment in preventative health will deliver social impact at a global scale.
Intake Assessment → Intentional, Measurable
I have answered the WHY we landed on a preventative and proactive health mandate—the surge of available data, new enabling technology and a global focus on well-being. Yet, HOW will Relentless measure social impact?
Our answer is the development of proprietary tools that align with existing impact investment standards of reporting. We know that data from digital solutions will deliver insights into the effectiveness of new products, platforms and services on our health.
Having an impact on improving health outcomes is delivering on social good—period.
In addition to improved health outcomes, for a company to be considered for investment by Relentless, they must also empower the patient and reduce healthcare costs. Data confirming better health outcomes and an engaged patient while also reducing overall healthcare expense will deliver a powerful data set strengthening our mission.
Assessment Tools & Reporting
When assessing the double bottom line potential of a company (financial and social returns), we use a proprietary intake tool—we cross reference the company’s potential to deliver on the three social impact health objectives with a company’s venture return drivers (i.e.: market need, technology innovation). An excerpt from our internal scoring tool follows:
As a venture fund with a commitment to reporting on social impact, our proprietary reporting tools also draw from the emerging industry standards for impact measurement and reporting. These standards are highlighted in a Harvard business paper, “Measuring the IMPACT in Impact Investing.”
Our cycle of reporting begins with an ESTIMATE of potential impact (i.e. the Intake Assessment), closely followed by the PLANNING for impact through strategy. Following investment our tools will then MONITOR impact and ultimately EVALUATE impact to prove social value. Reporting on the performance and progress of impact investments ensures accountability.
Team Relentless has developed a proprietary logic framework that outlines our impact goals and how we will measure and report on each goal for the information of our team and limited partners. For example, the following excerpt from our logic framework shares examples of metrics we will report on for potential investments in mental health:
The Relentless Venture Fund—A VC Fund With A Social Impact Heart
Social impact leader, Vancity, catalyzed the first closing of the Relentless Venture Fund earlier this year. The fund launch enabled Relentless’ participation in the $11B invested in digital health tech during the first three quarters of 2018. Our first investment, Canary Medical, garnered a CVCA Top 10 Deal ranking in H1 2018 with total deal size of US $26M.
The magnitude of digital health investment reflects both favorable trends in adoption, as well as investors’ expectation of continued growth in the use of technology for personal health management. Patient empowerment is the most financed health function to-date in 2018 at $2.1B and wellness in at second with $1.6B. These are large numbers and powerful trends fueled by growing consumer confidence that engagement with digital health offerings will contribute to healthier lives.
The numbers and trends reveal that the shift in the care model toward patient-centric, empowered care is real. Relentless is committed to the empowered citizen and healthier communities. The collective Relentless social impact heart is in the right place at the right time.
Inspired to learn more about pairing profits with purpose? Toronto, early November is the place to be for the 11th Annual Social Finance Forum.