Full Name: Iulian Circo Title: Co-founder. Wearer of many hats. Based in: Just relocated from Cape Town to Vienna, Austria, and spending time in Amsterdam where Proof of Impact is headquartered. Age: 44
1. In your words, who are you?
I am a recovering humanitarian turned entrepreneur. Over the last two decades I have been part of action-packed operations in some of the world’s most challenging environments. These included humanitarian missions in post conflict and peace-keeping settings, starting up operations & leading a UN agency in Somalia, or turning around and taking to scale country operations for large global non-profits in places such as Swaziland or Mozambique. Working on the frontlines of impact delivery I have learned to appreciate the role of technology as a force multiplier and the huge impact that entrepreneurship and innovation have on people and communities. I have also understood the inadequacy of incumbent business models (be these for profit or charity) in these settings and the huge opportunity that can be addressed with innovative business models that combine impact and profit.
2. Tell us about your company.
Proof of Impact came to be out of the combination of my impact background and Fleur’s (the other co-founder) insights from a life spent in capital markets and impact investing. We met in 2017 in Cape Town and both of us got excited by the idea of making impact tradeable. Of unlocking a trillion USD value of that we ended up calling the “Purpose Economy”. We see purpose as a transformational element that is defining the identity of a whole new generation. Young people are aware of the importance of social and environmental impact and see them as existential topics. They define their identity through purpose and authenticity, and this will change global economic frameworks fundamentally (link to changemaker article). We are passionate by the possibility of building viable financial products for this generation. Investment products that are underwritten by impact. Not by impact narratives or theoretical models. But by real, verified events. Both of us had various attempts at defining such models in the past. The emergence of blockchain technology provided a technical solution to some of the structural problems that come with this model. We could now use impact verification as a proof of work for a new type of financial asset. The timing was perfect, so we pulled the trigger and embarked on this wonderful journey.
We were initially self-funded and eventually we received some angel investment that helped us build a basic prototype and sign up a very exciting partnership with Cordaid and the Netherlands Government.. Eventually we signed up more than 30 different partnerships with impact creators and our partnership pipeline is looking pretty good. We are now at an exciting point in our evolution as we have just closed our current round of funding – the first institutional funding round – and have received investments from a good mix of venture capital and more established asset managers across Silicon Valley and Crypto Valley. We are now looking at going to market properly and growing fast.
3. Give us a day of your week. How do you start your day, and what do you do with Proof of Impact?
Proof of Impact is a 100% virtual team. This defines the way we all work. We run a simple agile framework across the team and are quite strict with a few simple rituals – we have bi-weekly sprints with structured demos, retrospectives and planning sessions. Like everyone else in the team, I start my day with a quick stand-up, going over what I did yesterday and what I am planning to do today and calling out blockers if any. It’s all asynchronous – we use a tool integrated in Slack that allows us all to do our stand-ups at the beginning of our own day, and then interact as people activate on different time zones. Everyone’s tasks are public in an organization-wide board. My day is usually divided between internal and external calls or meetings and time alone doing specific tasks that need to be done. I try as much as possible to stick to my plan for the day and stay out of everyone’s way. I see myself as a last line of defense so every time I see an orphaned task, I’d just do it – even if sometimes I suck at it and need to educate myself into writing some basic code or running a financial report. Done is better than perfect. This is pretty typical in early stages start-ups with founders and first employees regularly swapping between super-micro to super-macro levels in the same day, as decks are put together, code gets written, websites and automation gets set up, payments need to be done, etc. I personally love that phase, but it does take a toll on people and teams. We were lucky for both of us co-founders to be the types to be comfortable with that rhythm. And we were extremely lucky that our first employees turned out to be incredibly competent, passionate and just all-around bad asses. This is the secret sauce, really.
On Impact Validation
4. What differentiates the way you’ve built your marketplace from an attribution lens in quantifying and measuring impact from other companies seeking to do the same thing?
I think our approach is quite unique, in a category that gets a lot of new entrants every week. We are different in several ways:
- For starters, impact validation/verification is not our core business, but rather a critical component of our core business, which is building financial products on top of impact; This means that anyone who works at solving impact verification problems is complementary rather than competing with us. In fact, a commoditized, standardized verification market is one of the best things that could happen to us, so the increased activity in that space is a very exciting development.
- We are also different in that we are not verticalized in any way: we are agnostic to impact sector and geography. Also, we do not impose any impact thesis on our users and partners, allowing them to articulate and operate with their own thesis. So, for instance, we are productizing active household solar panels – the fact that a given solar panel is functioning in a very specific location. As an investor you could fund this specific, objective event coming from an education impact thesis (girls that have light at home can study later) or a renewable energy impact thesis (solar replaces coal in that household) or from a health or entrepreneurship impact thesis. This is quite central to our model: we verify and securitize unique, repeatable, hard to dispute events (outputs), not complex, hard to measure outcomes.
5. Can you share with us a couple impact creator partnerships you are proud of that are in development or currently active and what you are doing with them?
We have so may interesting and exciting partnerships with impact creators – non-profits and impact companies. One of our earliest partnerships has been with Cordaid – a leading Dutch Charity – facilitated by the Netherlands Government and the Government of Ethiopia. This partnership is exciting on so many levels – we are working in rural hospitals and we are innovating across the impact delivery stack. We are now working on structuring a basket product- like a compound impact index – that would allow the direct funding of activities in rural hospital that correlate with mother & child survival. We love the fact that we are working with incumbent, large partners. If we really want to achieve impact at scale, we need to be able to work with the people who deliver impact at scale right now. Throughout the process we have been very impressed with these partners’ ability to innovate and think different.
6. You guys are planning to launch in April 2020, what are some brand awareness or financial milestones you are looking to hit, or are proud of getting to?
We have always taken pride in being a product company That means that our brand work has almost exclusively been limited to inbound, content-based work. We have also chosen to stay under the radar, particularly during the hype-phase that blockchain technology in particular experienced in 2017. I think we are now ready to change that and we’re actively preparing more outbound marketing and more structured brand work. We are super proud of the state of our product and the fact that we can show traction and validation already without having spent a single cent on marketing. The most important art now is to work with a small group of real users to make sure our product experience is awesome and that we are prioritizing the important features, and then we are finally ready to activate our marketing.
7. How do you plan to have POI allow the measuring of social impact initiatives that are harder to track? For example, organizations- institutions that target discrimination, mental health, or sexual harassment/gender equality, a lot of which is dependent on the feedback of individual parties and on social sentiment? What kind of goals would you suggest?
Super important question. The truth is that some initiatives are easier to measure than others. Also, some of the most important work done in impact is close to impossible to measure individually. Awareness, societal behavior, structural factors. For now I actually think we should not prioritize these sort of initiatives and instead focus on those that have measurable outputs and natural proof-points that we can use to verify. As we get better at understanding correlations and verifying the right things, we can start focusing our impact design models towards these harder to measure areas.
8. What markets will you focus on growing your marketplace in in 2020?
Our plan is to focus on the Netherlands and Europe market first, then the Swiss market and eventually the US market. This is mostly opportunistic rather than part of some sophisticated strategy. We are 100% a global company and eventually we want our model to be available to impact creators and funders everywhere in the world.
9. Will you be coming out with an app?
We will make sure we build across any interface that our users would want to use. Apps are definitely part of that.
What is a consumer brand you feel is doing a good job in delivering positive impact? I’d ask you to stay away from any big, common names like LVMH, Nike, Patagonia, Nordstrom etc. as their efforts are either heavily spoken about or circulated.
This is a great question. I actually feel that most companies that stay close to consumers are actively working to bring purpose into their brands. This may be a differentiator now, but with the changemaker generation coming of age, they realize that without purpose they will simply slide into irrelevance. In this context, however, it is pretty hard to differentiate between real change and impact narratives. Without taking anything away from Patagonia – which remains an awesome, awesome company – it is relatively easy to bring impact at the fore-front of products that are premium, and that address educated, high-income market segments. It is a completely different story to do that in cut-throat, price-sensitive categories such as mass retail or FMCG. This is why I am personally very excited to see impact reflected at the level of mass-focused, low margin businesses. Often done quietly. I love it when I go into big retailers and notice that even the private labels signal purpose and virtue (locally sourced, organic, fair trade etc.). This is both a sign and an enabler of the mass-going revolution we all need. Patagonia and the likes have showed the way, now we need the Walmarts and the Costcos to follow.
Interview by Susan Im