After founding two tech startups, Jochem Wieringa immersed himself in alternative financial services. He started the first VC fund in Europe for blockchain startups. Now, Jochem is an impact investor, with a focus on Africa, where the perceived risk is high and the additionality is significant. 

How did you get involved in impact?

About four years ago, my partners at our VC fund noticed that I was gradually losing my drive a bit. We had grown significantly, but it no longer made me happy. So I took some time for myself to reflect on what I was doing it all for. I realized that I want to invest all my time and money 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 made the point that many people in the Netherlands could easily miss 10% of their income without it making them less happy. Add to that the fact that the top 2% most effective charities are up to 100 times more effective than the average charity. So it really matters where you donate. I decided on the spot to donate 10% to the most effective charities from then on. Shortly after, I founded the 10% Club with a group of friends, simply because it’s fun and inspiring not to do something like this alone. Together, we explore how, using the latest scientific insights, we can do the most ‘good’ by investing in the most effective charities. The growth of this club was very organic, and surprisingly fast; apparently, there is a great need to give! By now, the 10% Club organizes events throughout the Netherlands. We want to make it normal to talk with each other about where you donate and to inspire each other and others in doing so. And we want to increase awareness that there is a huge difference in effectiveness.

What is effectiveness?

That depends on the theme. When it comes to climate, for me it’s about how much CO2 you can remove from the air per euro donated or invested. In the health sector, it’s about the number of life years you save per euro. There are charity evaluators; you can measure impact.

The biggest eye-opener is that the large difference in effectiveness doesn’t really come from how much the director earns, or how much is spent on marketing. The real difference is made by what an organization does: some measures are 100 times more effective than others at achieving the same goal.

What does impact investing look like for you?

With a background as an investor and entrepreneur, I prefer to invest directly in early-stage companies with mission-driven entrepreneurs. My goal is to put all my invested capital into as much impact as possible, and I have a fully quantitative method for that. There is an opportunity cost to investing in a little impact, namely that you can’t invest that money in something much more impactful. I haven’t found a fund yet that takes impact as seriously as I want. With most “impact” funds, it’s mainly ESG box ticking and overestimated impact.

Why Africa?

I started in Africa because early in my journey I was approached by a Kenyan company. I dove into it and realized: I want more of this. I also think my ‘additionality’ as an investor is greatest there, and the high perceived risk is already priced in. Because Africa is underfunded, capital hardly competes with each other. In Europe and the US, VC funds keep their best deals for themselves. If you did that in Africa, an investment round usually wouldn’t fill up, even for very promising companies. The atmosphere is also very different, because we work together as investors. It’s inspiring to be there.

What are some great examples of companies you’ve invested in?

: a Kenyan ‘Direct Air Capture’ company that sucks CO2 out of the air to store it permanently underground. They sell carbon credits for this. You need specific geological layers for this, and a lot of renewable energy. In Kenya, there is a surplus of thermal energy: 90% of the country already runs on renewable energy, making it one of the greenest electricity grids in the world. Octavia Carbon’s biggest competitor is in Iceland, where everything is much more expensive than in Kenya. Although they have attracted much more capital, they are much less efficient.

: this company connects small pharmacies in the most remote areas of Uganda, Nigeria, and Kenya with services that prevent medicines from being unavailable in those areas. They do this with a hardware platform optimized for environments with unreliable internet, heat, dust, and frequent power outages. They combine this hardware with software that requires almost no internet and even works well offline.

And (so much) flying to Africa? What are your thoughts on that?

I’ve calculated it. You can’t know in advance what the impact of an investment will be, so I work with scenarios. I assume that about 80% of my portfolio will ultimately not make it, and that a few other companies in my portfolio will have mega impact and “pay” for the rest. The weighted average of those scenarios is the ‘expected impact’ of my portfolio. This is the same model VC funds use to calculate their expected returns, but applied to impact. Compared to the order of magnitude of that expected impact, my flying makes almost no difference. But that doesn’t mean I don’t think about it; I usually go for longer periods, sometimes several months at a time.

What advice do you have for new impact investors?

The belief that impact must come at the expense of financial returns is outdated. Accelerating innovation, changing consumer needs, and ever-cheaper green energy are enabling business models where impact and profit go hand in hand. Impact-driven companies attract more talent, customers, and partners. Regulation is increasingly in their favor. As a result, these types of companies can attract cheaper capital, which further increases their scalability and profitability.

But you do have to search well to find the best companies. So I recommend teaming up with other investors. Impact investors generally collaborate much more, especially in Africa. And and people share best practices. You shouldn’t want to invest alone, especially if sector knowledge is needed. I always work with people who know what they’re talking about.

How can we all make more impact?

Making impact is also about creating awareness. So I share everything. I think people in the Netherlands feel that you shouldn’t brag too much about doing good, and that’s why we’re all quiet about it. But this is such a shame, because it means we’re missing a huge opportunity to inspire each other. That silence holds back growth. So my big tip is: be viral, talk about what you do. We manifest the world we talk about. I notice it a lot in my own life; I get so many investment opportunities because people know exactly what kind of investments I’m looking for. Precisely because I talk about it.