Guiding a startup through the early phases of growth can be intimidating. Many successful entrepreneurs pour incredible amounts of time, effort, and resources into getting their businesses off the ground.
Once a company has taken off, though, it can begin to reap the reward for its labors. Over time, the payback can become significantly more than they could ever need for themselves.
When an entrepreneur becomes successful, there is a natural expectation for them to share some of their newfound wealth with others in need. Here are a few examples of ways that successful business owners and their businesses can make a positive impact with their wealth.
1. Pay it forward.
One of the best ways for entrepreneurs to use their profits for good is to pay it forward to equip future generations.
The continual rebirth of business that takes place in the entrepreneurial space is dependent on the outside investment and support of others. It might be angel investing or supporting training and certification. There are many ways that both successful startups and well-established enterprises can support those who follow in their wake.
One good example of this is Technology Concepts Group International. TCGI has spent years developing forward-thinking IT solutions for its customers. Over time, the leaders at TCGI have seen the need for ongoing development, innovation, and diversity in the tech space.
This led the company to create the TCGI Foundation scholarship fund. The goal of this effort is to break barriers and create opportunities for women of color in the STEM industry.
This is done by helping them obtain the funding that they need to get into the STEM world, including both accessing STEM education and finding a job after graduation. Along with the actual work of running the foundation, TCGI also hosts fundraising events, such as its upcoming John Fitzpatrick Memorial Golf Classic fundraiser in June of 2022.
The example set by TCGI and others is a good one. There are multiple good philanthropic suggestions on this list. But finding opportunities that invest in the future good of your own industry is a primary way for entrepreneurs to make an impact.
2. Preserve what we have.
Another common way for entrepreneurs to make an impact with their money is by supporting the environment that fostered their business success.
This includes a variety of factors, from environmental conservation to paying a living wage, sourcing local ingredients, and so on.
One startup that is exemplifying this is All Real Nutrition. The Irish snack brand has developed a line of high-quality protein bars that are popular in Ireland, the U.S., and other areas of the world.
The owners of All Real have used their success to set up significant sustainability initiatives. One of these is creating the All Real Clean Planet Project. This organization donates funds to charity partners that work to clean plastic pollution from the ocean. The company committed to keeping 3.75 million bottles out of the water in 2021 alone.
In addition, the company prides itself on breathing sustainability into its day-to-day operations. It pays a living wage at the least to ensure that its workers are happy. It also has invested in sustainable packaging, sourced as many local ingredients as possible, and developed fully compostable wrappers in accordance with its pledge to be part of a cleaner world.
3. Invest in education.
We already covered education that targets development within your own industry. However, there is also a larger calling for entrepreneurs and business owners to invest in academic advancement in general.
The ability to access education and increase knowledge is what sparked the rapid cultural acceleration of the last few centuries. It’s likely one of the key concepts that will keep that developmental momentum moving forward, as well.
For a good example, this time we’re going to go back a bit in history.
Andrew Carnegie is a famous Scottish-born businessman. He came to America as a child and ultimately launched the Pennsylvania steel industry in the mid-to-late 19th century.
Carnegie was a savvy businessman and one of the richest men in early America. He sold his self-made business for nearly half a billion dollars at just 65 years old. From there, he spent the rest of his life donating $350 million to charity — much of which went to the establishment of numerous public libraries. In addition, Carnegie was one of the first people to underscore the concept that the wealthy don’t just have the option to be generous. They have a moral obligation to do so.
4. Donate what you’re already good at.
There are many different ways to give to charity. One of the simplest options for a successful business to give back to the community is to do what they do best.
If you’re a contractor, offer to help a non-profit with a construction project. Perhaps you started an IT business and could help a charity set up a safe cybersecurity network at no cost. If you’re a freelance writer, create text for nonprofit websites pro bono.
One good example of this comes from Andy Karuza of the automotive IT and semi-autonomous accessory brand FenSens. When asked for an easy way for entrepreneurs to give back after finding success, Karuza’s response was simple: offer whatever you’re good at.
For Karuza, this was marketing, something his company excelled at doing. The details may change from one company to the next.
You’ve invested heavily in honing the strengths of your business’s products and services. As a result, it’s a good idea to tap those same strengths as solutions you can offer others. This is especially the case when you look for ways to give back to your community.
There are many ways that businesspeople can make an impact. Successful entrepreneurs are supporting education and the future of their industry. Many are investing in sustainability and using their strengths to help nonprofit organizations.
The important thing is that business owners recognize when they’ve successfully passed the startup phase and are making enough revenue to be successful. Once that happens, as Carnegie pointed out a century ago, successful entrepreneurs have a moral obligation to look out for the greater good of those around them. Make sure you take that charge seriously.
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Fintech Kennek raises $12.5M seed round to digitize lending
London-based fintech startup Kennek has raised $12.5 million in seed funding to expand its lending operating system.
According to an Oct. 10 tech.eu report, the round was led by HV Capital and included participation from Dutch Founders Fund, AlbionVC, FFVC, Plug & Play Ventures, and Syndicate One. Kennek offers software-as-a-service tools to help non-bank lenders streamline their operations using open banking, open finance, and payments.
The platform aims to automate time-consuming manual tasks and consolidate fragmented data to simplify lending. Xavier De Pauw, founder of Kennek said:
“Until kennek, lenders had to devote countless hours to menial operational tasks and deal with jumbled and hard-coded data – which makes every other part of lending a headache. As former lenders ourselves, we lived and breathed these frustrations, and built kennek to make them a thing of the past.”
The company said the latest funding round was oversubscribed and closed quickly despite the challenging fundraising environment. The new capital will be used to expand Kennek’s engineering team and strengthen its market position in the UK while exploring expansion into other European markets. Barbod Namini, Partner at lead investor HV Capital, commented on the investment:
“Kennek has developed an ambitious and genuinely unique proposition which we think can be the foundation of the entire alternative lending space. […] It is a complicated market and a solution that brings together all information and stakeholders onto a single platform is highly compelling for both lenders & the ecosystem as a whole.”
The fintech lending space has grown rapidly in recent years, but many lenders still rely on legacy systems and manual processes that limit efficiency and scalability. Kennek aims to leverage open banking and data integration to provide lenders with a more streamlined, automated lending experience.
The seed funding will allow the London-based startup to continue developing its platform and expanding its team to meet demand from non-bank lenders looking to digitize operations. Kennek’s focus on the UK and Europe also comes amid rising adoption of open banking and open finance in the regions.
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Fortune 500’s race for generative AI breakthroughs
As excitement around generative AI grows, Fortune 500 companies, including Goldman Sachs, are carefully examining the possible applications of this technology. A recent survey of U.S. executives indicated that 60% believe generative AI will substantially impact their businesses in the long term. However, they anticipate a one to two-year timeframe before implementing their initial solutions. This optimism stems from the potential of generative AI to revolutionize various aspects of businesses, from enhancing customer experiences to optimizing internal processes. In the short term, companies will likely focus on pilot projects and experimentation, gradually integrating generative AI into their operations as they witness its positive influence on efficiency and profitability.
Goldman Sachs’ Cautious Approach to Implementing Generative AI
In a recent interview, Goldman Sachs CIO Marco Argenti revealed that the firm has not yet implemented any generative AI use cases. Instead, the company focuses on experimentation and setting high standards before adopting the technology. Argenti recognized the desire for outcomes in areas like developer and operational efficiency but emphasized ensuring precision before putting experimental AI use cases into production.
According to Argenti, striking the right balance between driving innovation and maintaining accuracy is crucial for successfully integrating generative AI within the firm. Goldman Sachs intends to continue exploring this emerging technology’s potential benefits and applications while diligently assessing risks to ensure it meets the company’s stringent quality standards.
One possible application for Goldman Sachs is in software development, where the company has observed a 20-40% productivity increase during its trials. The goal is for 1,000 developers to utilize generative AI tools by year’s end. However, Argenti emphasized that a well-defined expectation of return on investment is necessary before fully integrating generative AI into production.
To achieve this, the company plans to implement a systematic and strategic approach to adopting generative AI, ensuring that it complements and enhances the skills of its developers. Additionally, Goldman Sachs intends to evaluate the long-term impact of generative AI on their software development processes and the overall quality of the applications being developed.
Goldman Sachs’ approach to AI implementation goes beyond merely executing models. The firm has created a platform encompassing technical, legal, and compliance assessments to filter out improper content and keep track of all interactions. This comprehensive system ensures seamless integration of artificial intelligence in operations while adhering to regulatory standards and maintaining client confidentiality. Moreover, the platform continuously improves and adapts its algorithms, allowing Goldman Sachs to stay at the forefront of technology and offer its clients the most efficient and secure services.
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UK seizes web3 opportunity simplifying crypto regulations
As Web3 companies increasingly consider leaving the United States due to regulatory ambiguity, the United Kingdom must simplify its cryptocurrency regulations to attract these businesses. The conservative think tank Policy Exchange recently released a report detailing ten suggestions for improving Web3 regulation in the country. Among the recommendations are reducing liability for token holders in decentralized autonomous organizations (DAOs) and encouraging the Financial Conduct Authority (FCA) to adopt alternative Know Your Customer (KYC) methodologies, such as digital identities and blockchain analytics tools. These suggestions aim to position the UK as a hub for Web3 innovation and attract blockchain-based businesses looking for a more conducive regulatory environment.
Streamlining Cryptocurrency Regulations for Innovation
To make it easier for emerging Web3 companies to navigate existing legal frameworks and contribute to the UK’s digital economy growth, the government must streamline cryptocurrency regulations and adopt forward-looking approaches. By making the regulatory landscape clear and straightforward, the UK can create an environment that fosters innovation, growth, and competitiveness in the global fintech industry.
The Policy Exchange report also recommends not weakening self-hosted wallets or treating proof-of-stake (PoS) services as financial services. This approach aims to protect the fundamental principles of decentralization and user autonomy while strongly emphasizing security and regulatory compliance. By doing so, the UK can nurture an environment that encourages innovation and the continued growth of blockchain technology.
Despite recent strict measures by UK authorities, such as His Majesty’s Treasury and the FCA, toward the digital assets sector, the proposed changes in the Policy Exchange report strive to make the UK a more attractive location for Web3 enterprises. By adopting these suggestions, the UK can demonstrate its commitment to fostering innovation in the rapidly evolving blockchain and cryptocurrency industries while ensuring a robust and transparent regulatory environment.
The ongoing uncertainty surrounding cryptocurrency regulations in various countries has prompted Web3 companies to explore alternative jurisdictions with more precise legal frameworks. As the United States grapples with regulatory ambiguity, the United Kingdom can position itself as a hub for Web3 innovation by simplifying and streamlining its cryptocurrency regulations.
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