December 2024

After co-founding two tech startups, Jochem Wieringa became interested in alternative financial services and soon started the first VC fund in Europe for blockchain startups. Jochem is now an impact investor focusing on Africa, where the ‘perceived risk’ is high and the ‘additionality’ is big. 

How did you get into impact? 

About four years ago, my partners in our VC fund noticed I was losing my drive; even though our fund had grown a lot, it wasn’t making me happy anymore. This prompted me to take some time for myself to think about the ‘why.’ I realized that I want to spend all my time and money investing in super smart people who want to make the world a better place—100% impact. 

Can you tell us more about the 10% club? 

I read an interview with Rutger Bregman, who pointed out that many people in the Netherlands could easily spare 10% of their income without it affecting their happiness. I also became aware of the fact that the top 2% of the most effective charities are 100 times more effective than the average charity. Now imagine the amount of impact we can have with that 10%! I decided to donate 10% to effective charities from then on. Subsequently, some friends and I founded the 10% club for others who want to do the same. Together, we seek to do maximum ‘good,’ wish to normalize discussions about donating and seek to raise awareness about the vast difference in effectiveness. The club's growth was very organic and fast; apparently, we are striking a chord with the spirit of the times. 

What is effectiveness? 

It depends on the theme. For climate change, for example, it might be about how much CO2 you can remove from the air per donated or invested euro. In the health sector, it might be the number of live-years you save per euro. There are many charity evaluators; you can measure impact. The most significant difference between the most effective charities and the rest is not how much money an organization spends on overheads like marketing; it is what an organization actually achieves. Some interventions are simply 100 times more effective in reaching the same goal than others.

What does impact investing look like for you?  

With a background as an investor and entrepreneur, I prefer to invest directly in early-stage businesses led by mission-driven entrepreneurs. I aim to put all my invested capital into as much impact as possible, and I have a quantitative method to achieve that. We mustn’t forget that the opportunity cost of investing in a ‘bit of impact’ is not investing in a more impactful solution. Impact funds often overestimate their impact and resort to ESG box-ticking. Personally, I haven’t found a fund yet that takes impact seriously enough. 

Why Africa? 

I started looking at Africa because I was approached by a Kenyan company early in my journey. I then dove into it and realized I wanted more of this. I believe my 'additionality' as an investor is greatest there, and the higher perceived risk is accounted for. Besides, because Africa is underfunded, capital competes very little with each other. There is no competitive edge in keeping good deals for yourself and being the only one in an investment round. This makes the atmosphere very different; unlike in Europe or the US, VC investors in Africa often collaborate. It's inspiring to be there.

What exciting companies have you invested in/do you want to invest in? 

OCTAVIA CARBON: a Kenyan 'Direct Air Capture' company. Their technology sucks CO2 out of the air to permanently store it underground or to turn it into climate-neutral carbon products such as sustainable aviation fuels. You need specific earth layers to store the carbon, plus abundant renewable energy. Kenya has both. Their biggest competitor is in Iceland, a company that has attracted much more capital yet is much less efficient. Fun fact: In Kenya, there is a surplus of thermal energy: 90% of the country already runs on thermal energy, making it one of the greenest countries in the world! 

SIGNALYTIC: a company that connects pharmacies in the most deeply remote areas in Uganda, Nigeria, and Kenya to essential services that prevent them from going out of stock. They offer a hardware platform optimized for an environment with intermittent low-bandwidth internet, heat, dust, and frequent power outages. They combine that with software that needs very little bandwidth and is even functional offline.

Any thoughts on flying to Africa so frequently? 

I did the math. It’s hard to predict the exact impact of an investment upfront, so I work with scenarios. For instance, I assume that around 80% of companies will not make it and that a few others will make a mega impact and “pay” for the rest. This is the typical model VC funds use to calculate their expected financial returns, but applied to impact. The weighted average of those scenarios is my portfolio's 'expected impact.' Compared to the scale of that expected impact, my flying makes little difference. But that doesn't mean I don't think about it at all; for example, when I go, I go for more extended periods.

What would you advise new impact investors? 

The thesis that impact results in low financial returns is outdated. Accelerating innovation, public momentum, and the shift to abundant renewable energy enable business models that don’t compromise profitability for impact but are profitable because of their impact. Impact-driven companies nowadays attract more talent, customers, and partners, and regulation is increasingly favoring them. These advantages allow impact-driven companies to attract more and cheaper capital, further bolstering their competitiveness.

But you have to look hard and be well-connected to find impactful companies with excellent business models. So, I advise meeting other investors. There is a lot of potential for collaboration, especially in Africa. In networks like PYM, people share deals and best practices. Don’t invest alone. I also collaborate with other angels and funds, especially when sector expertise is needed. I always work with people who know what they are doing. 

How can we all make more impact?

I think people in the Netherlands feel that you shouldn't brag too much about doing good, and that's why nobody talks about it. It’s such a shame because we miss out on the chance to inspire each other. Anonymity prevents growth. So my big tip is: be viral - talk about what you do. I notice it time and time again; the right investment opportunities get presented to me precisely because people know what kind of investor I am and what I’m looking for. So much of impact is about awareness.

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