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INSIDEFDI


Challenging the hero’s journey


DESPITE THE BENEFITS IT CAN BRING, QUANTITY OVER QUALITY IS NOT ALWAYS BETTER WHEN IT COMES TO TECHNOLOGY, WRITES JACOPO DETTONI


ters of the likes of Steve Jobs, Sergey Brin, Jeff Bezos, Mark Zuckerberg, Elon Musk and many others. They all started very small—sometimes in a garage, as themyths go—before end- ing up too big to fathom. While their companies disrupted


T


the world economy, their journey triggered a cultural revolution. Young professionals across the world have drawn fromSilicon Valley’s cus- toms and habits andembarked on their own hero’s journey. Policy-makers have taken notice


too, supporting the rise of local tech ecosystemsto create jobs and attract investment. The underlying assump- tion is that serial entrepreneurship applied to tech start-ups is a force for good. Start-ups and tech ecosystems have brought a new level of innova- tion into our societies, and no one can take that away from them. They even actively contributed to the fight against Covid-19, finding solutions to some of the most critical issues caused by the pandemic (see page 36). However, some of these compa-


nies have becomesodominant that they’re nowbeing accused of stifling innovation to preserve the status quo. Start-ups have created millions of jobs worldwide, and they’ve been a real shot in the armfor the job market in the wake of the global financial crisis. But when itcomes to the quality of those jobs, that’s another issue. Andit’s not just aboutmoney,


which oftenremainscompelling vis-a- vis other jobs, bothin developed and developing countries. Job security has oftenbeen on the line too. The status of thoseworking for the likes of Uber and Deliveroo have been a matter of debate and legal challenges for years. Andeven assuming that quality is not an issue, quantity is not guaranteed either. The level of failureamong


August/September 2021 www.fDiIntelligence.com


hey call it the hero’s journey. Over the years, we have come to knowit well through charac-


start-ups is so high that researchers estimated that retrenching start-ups offset65%of thenewjobs created by their more successful peers across 10 countries in a single year (see page 20). “In the rush that accompanies


the birth of a new company and its limitless potential, founders rarely pause to think about the harmful ways in which their technology might impact their ecosystemor soci- ety at large,” admits Christine Tsai, the CEO of San Francisco-based, early- stage venture capital 500 Startups (see page 46). They pay little heed to the toll their ventures take on their own person too, with mental wellbe- ing emerging as a growing issue within the start-up community. Don’t getmewrong—tech eco-


systems are the driving force behind our digitised societies and will con- tinue to get bigger and bigger. As the pandemic cripples legacy players, disruptive start-ups will create new markets and technologies, creating employment and investment oppor- tunities along the way.Whether they will also be a force for good, however, is up for debate. Environmental, social and gov-


ernance (ESG) finance has breathed new life into stakeholder capitalism. Newmetrics are being refined to gauge the performance of businesses beyond profits. So jobs themselves are not enough any longer, and nor is investment. Start-ups have a chance to leverage their disruptive technolo- gies and business models to augment their impact on the ecosystemas a whole from an ESG perspective. It’s not amatter of outcomes, but


design.Moving forward, success will also hinge onembedding ESG princi- ples in the same design of the ‘uni- corns’ of tomorrow. Modern heroes please take note before embarking on your journey.■


Jacopo Dettoni is the editor of fDi. 3


ESG FINANCE HAS BREATHED NEWLIFE INTO STAKEHOLDER CAPITALISM


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