Contemporary structures for placing investment capital are both effective and in need of reform. Equity-holding, market-return-creating, liquidity-driven investment capital has driven innovation while creating inordinate pressure upon teams of small startups and public companies alike. These companies (and their investors) feel pressure to overstate their impact, minimize their deficiencies, and characterize other companies primarily as foes to be vanquished. We’re interested in new investment mechanisms that mitigate this unproductive pressure without sacrificing execution and excellence.
We imagine ventures and funds that sit along the spectrum between personally backed small business loans and high-growth, exit-oriented venture capital, allowing for access to capital and long-term private ownership for businesses of varying sizes and time horizons. The challenge is to honor the stakes of both investor and entrepreneur. Solutions may include new debt mechanisms, pools of capital amongst entrepreneurs, or permanent capital placement with creative liquidity approaches.
In today’s commercially-driven world people are more likely to be seen and referred to as 'consumers' than anything else. Instead of being met with resistance, this shift has often meant that individuals have formed their identity through a composite of brands, and product purchasing can be guided more by the desire to make a statement about one’s identity and values than strict utility. As a result, the lines between social movement, capitalism, and community are increasingly blurry (see: Nike, Whole Foods, and Patagonia).
Given this reality (which is with us for both better and worse), we’d like to support entrepreneurs with a vision for building brands with a counter-culturally virtuous and optimistic view of the world, spreading hope and beauty, eliminating stigma, and most fundamentally, redirecting our identity away from materialistic consumption and toward lasting contentment.
Praxis VEntures Working On This ORI
has built a streamlined way to fund transformational businesses using the donor-advised fund (DAF), unlocking the potential for billions of dollars in dormant resources to be used as patient capital to enterprises with a variety of return profiles (Jeff Johns and Aimee Minnich, Nonprofit 2016).