How Maki VC is driving change in startup investments: a look at its 2023 Sustainability Report

Maki VC's 2023 Sustainability Report highlights progress in diversity and ESG metrics among its portfolio companies and throughout its firm.
How Maki VC is driving change in startup investments: a look at its 2023 Sustainability Report

Helsinki’s Maki VC is a deeptech VC that invests in early-stage companies from their inception to Series Seed and beyond. It primarily focuses on the Nordics but selectively invests across Northern Europe, with investments in startups from Finland, Sweden, Norway, Germany, France, the UK, and the US.

Investments include sustainability-focused startups such as Spinnova, IQM, and ONEGO, as well as health startups like Cardio Signal and Jennis.  

The firm recently released its 2023 Sustainability Report, which surveyed 32 of its portfolio companies. It offers a progress report around both the firms and the companies it invests in when it comes to diversity and ESG (Environmental Social Governance) metrics, commitments, and actions.

While these reports are not the most exciting thing you’ll ever read, early stage founders should prioritise diversity and ESG as diversity-first startups with an intentional commitment to such practices is a key criterion for most VCs from here on then.

Let's face it, investment in women-led companies is dire in most of Europe.

The Maki report revealed that there’s no shortage of talented female founders —  35% of portfolio companies have founders/co-founders that identify as female."

However, just 15 percent of companies have gender-diverse boards. This exceeds the industry average of 12.2 percent. I’m of two minds. I want diverse boards offering a diversity of experience and advice.

But I also want to know what value being a board member provides. Is it considered a career-boosting skill or time away from KPI-raising activities?

Cultural diversity takes many nationalities

According to Maki’s report, founder nationality has improved by 18 per cent, a figure it attributes to companies growing and expanding into new markets.

Data from Maki VC Sustainability Report

Cultural diversity is lowest among both management and board members, although it has increased from earlier years. I think the increase skilled migrant visas throughout Europe will help increase cultural diversity amongst startups overall.

But I'm also mindful that "like attracts like." In conversations with fellow migrants, "lack of cultural fit" frequently comes up as a barrier to employment.

That said, Maki should be commended for introducing founders to talent pools beyond their own startup bubbles. 

Workplace well being goes beyond free counselling

Startups want to attract and retain talent. It’s good to see 80 per cent of those surveyed have a policy or strategy in place to provide support for staff on mental health and wellbeing. 

Yet only 57 per cent have a whistle-blowing policy in place. 

Further only 66 per cent have a code of conduct policy  (although 13 per cent are in progress of developing one). 

I would have been interested to learn how many companies have anti-harassment and bullying policies.

While I haven't heard specific reports about Maki VC's portfolio companies, as a female woman in European tech, I hear frequent accounts of bullying, sexual harassment, and discrimination within startups, especially against female migrants.

So an active commitment to making a harassment and bullying free workplace is essential.  

A commitment to ESG takes work

The reality is that committing to being a good company takes strong intentional work. And if you look at the carrot and the stick, most companies in general are more motivated by the stick than the carrot. That said, it’s a little different for companies already in the sustainability sector — 61 per cent of Maki VC companies discuss ESG at a board level, while 34  per cent of companies estimate their GHG emissions (60 per cent of Fund I and 7 per cent of Fund II). 

Maki VC does talk the talk. ESG factors into its investment decisions, 65 per cent of its employees are female, and 25 per cent of partners

Overall, the report highlights a growing trend of VC interest in ESG, especially for sustainability-focused startups. For early-stage founders, prioritising diversity and ESG practices is becoming increasingly important to attract investors.

Maki VC's 2023 Sustainability Report shows progress in diversity and ESG metrics for their portfolio companies. While there's improvement, particularly with female founders and company size, there's still work to be done in areas like board diversity, cultural inclusion, and anti-harassment policies.

Lead image: Jan Piatkowski.

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