Today we announce the launch of Mission Studio, which will create innovative new ventures to solve pressing social problems. Over the next three years, in partnership with the leading venture-builder Founders Factory, we’ll create, spin out, and invest in nine new backable ventures that tackle major health challenges and reduce carbon emissions in the home.
At Nesta, our ambition is to improve the lives of millions of people by pursuing three innovation missions. We won’t achieve this without big ideas and interventions. Often this will mean partnering with existing public, private, and social sector institutions to take ideas to scale. At other times the best path to scale will be a new product, and may require new business models or new ways of working, where a new entrant has an advantage to act without the constraints that bind large incumbent organisations. Nesta has a long track-record of supporting existing early stage social ventures, and Mission Studio will build on that experience with a specific focus on new ventures.
These new ventures will combine profit and purpose. Commercially successful ventures are able to attract investment and grow rapidly, helping us reach large parts of the country. Further, each of our innovation missions has influential private sector actors, including energy companies, supermarkets and ed tech startups, and the Mission Studio’s ventures can help us influence and shape those markets.
However, combining profit and purpose is hard. Unlike purely commercial ventures, Mission Studio ventures have two ways to fail - a double bottom line. Any venture can fail if it doesn’t establish product-market fit and doesn’t make money. But our ventures have a second bar to clear: they need to further one of our innovation missions. It’s no use making lots of money if we have no impact on the challenges we want to overcome. A fine balance is required and it’s all-too-easy for profit or purpose to become the dominant force, at the cost of impact or scale. What’s exciting about this partnership is that Nesta and Founders Factory together are uniquely well-placed to get this right. Founders Factory has supported more than 200 commercially-viable ventures globally, 45 from scratch in their studio. Nesta has decades of experience innovating for social good, was one of the pioneers of impact investing in the UK, and brings in-house innovation knowledge and methods to a renewed focus on three innovation missions. At Mission Studio, profit and purpose are truly twin imperatives.
We are not alone in this space and there are other incredible organisations backing purpose-driven, for-profit ventures in the UK and globally. For example, some venture builders place their bets primarily on talent and act almost as a matchmaker for groups of aspiring social entrepreneurs, providing light-touch guidance and support. Mission Studio will place its bets instead on specific pairings of concepts and founders, taking a more directed, hands-on approach. Together with entrepreneurs, the studio will develop venture-backable concepts that directly contribute to our missions: ventures that reshape the food environment, decarbonise home heating, and reduce loneliness. Just three ventures will clear this bar each year. Once they do, they’ll get a package of tailored, high-intensity support from a best-in-class commercial venture builder to greatly increase their odds of succeeding.
For each of our missions Nesta will identify multiple ways to effect change. For example, there are multiple challenges in decarbonising our homes. Lower-carbon solutions such as heat pumps are under-adopted because of expense, lack of information, and a lack of qualified installers, among other reasons. These are each solvable problems, and if we get it right we can make a major dent in the UK’s net zero ambition. Nesta and a new venture can complement each other; for example, Nesta’s policy advocacy could tip the balance on scale or affordability for a new venture to be able to operate. Or a new venture could provide better, more accessible information to consumers in a way that stimulates demand, opening the door to more effective policy advocacy by Nesta. Combining Nesta’s knowledge of which levers to pull for impact with Founders Factory’s understanding of what’s likely to generate returns and grow, we have potential to bring about real change.
The other thing that’s distinctive about Mission Studio is that we have an opportunity to level the playing field for founders. Many venture-building programmes require founders to take time out from their careers to take a big risk on a yet-to-be-tested idea in exchange for a stipend. This can make it hard to pay the bills unless you’ve got significant resources behind you, and can be a challenge for people from lower-income backgrounds or with family commitments for example. Our model de-risks the experience for people who might otherwise be locked out of a venture building programme. We’re actively seeking out founders with lived experience of the issues we’re hoping to tackle. Each founder will work on a well-developed concept, and will get a lot of support, including access to world-class expertise and mentoring, and a six-month funding runway to develop the business while also being able to financially survive as an individual. With Mission Studio, founders don’t have to put their lives on hold. There is risk in any new venture, but by de-risking the process as much as possible, we can attract a more diverse group of founders.
In the months ahead the team will be speaking with entrepreneurs and start generating ideas. We’ll then refine and assess the best concepts for commercial viability and social impact. Three concepts and founders will then enter our intensive build programme where they’ll stay with us for six months. We’ll then do it all again next year. At the moment we have no idea what will come out the other side, but we’re excited to find out. Mission Studio has the potential to help us change millions of lives, reshape markets, and begin to untangle some of society’s biggest challenges. We can’t wait to get started.
Mission Studio by Nesta and Founders Factory will create, spin out, and scale new tech startups reducing household carbon emissions and improving health through tackling obesity and loneliness