A new $20 million fund and incubation initiative designed to address the high failure rate of New Zealand startups with a social or environmental purpose has launched.
According to latest Government data, startup survival rates in New Zealand, including those with a social imperative, have declined by 45 percent over the past six years – a trend that began prior to the current pandemic.[1]
Nous Labs, a new organisation which provides investment, mentoring, coaching and marketing support for environmentally and socially focused Kiwi enterprises in their early stages of growth, is the creation of Brianne West founder and CEO of the country’s largest regenerative beauty product exporter, Ethique.
West (pictured) says it is critical Kiwi startups which are purpose-led be allowed to develop to a point of maturity where they become self-sustaining.
She says these ventures are built around a business model that seeks to solve a social or environmental issue and will play an integral part in addressing societal problems in the future.
“What we know about the early stage of social enterprises is that only around five percent will survive through their first decade.
“Businesses which are mission driven often face additional barriers in reaching the next stage of their lifecycle and lack the support and infrastructure needed for long term viability.
“These social enterprises may be introducing a new concept to the market which requires a high investment in consumer education, they may incur significant R&D costs in the early stages of their launch, or the cost of giving back in some form may simply be too high for a startup to bear.
“As someone who has started and scaled a mission driven company, I have a first-hand understanding of the barriers they will encounter.
“While many may face challenges that are unique to their model, we need to look at the potential benefit to society they provide as well as what they can contribute to the economy,” she says.
West, a former winner of the EY Young Entrepreneur of the Year award, says Nous Labs will be open to anyone with a great idea trying to solve a problem, including tertiary students as well as startups and will exist as a values-led growth programme for businesses and entrepreneurs working to create a better world.
She says her own entry into a startup competition while at university supported the growth of Ethique, which now supplies a line of regenerative beauty products to thousands of retailers in over 25 countries.
“The first stage of the Nous Labs launch will be a competition open to New Zealand entrepreneurs of all ages with an early-stage startup which can help address a societal or environmental issue.
“Students will be asked to present their idea virtually to an expert panel which will include identifying the social or sustainability problem they are seeking to change and details of how that will be achieved.
“The business support package for the early-stage startup competition ‘Got Nous’ is valued at $140,000.
“From there, the incubator will support other Kiwi startups which operate as a social enterprise in some way.
“Having entered a competition that helped me reach mentors and access support while I was studying at university, I recognise the need to help bring socially focused entrepreneurs through the initial stage of their startup development,” she says.
More information about Nous is available here.
[1] Statistics NZ .
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