Balancing impact and scalability in early-stage startup support
While women-led startups are gaining more attention, those that focus on impact often miss out on crucial opportunities. Studies show that women drive more impact-driven projects than men, prioritising the social impact of their businesses and communities over revenue. For many VCs, this is a red flag against backing such initiatives.
Worldwide, women make up only 12% of digital startup founders and 11% of CEOs, and in 2023, only 2.3% of VC funding went to women-founded startups.
At Duamentes we constantly work with startups in 40 countries, providing them with reliable insights for their growth journey. The role of impact is underestimated, and this year we partner with Aurora Tech Award in setting new, fair standards in the IT industry. Social impact is one of the key factors to win Aurora Tech Awards. We oversee, social impact startups typically prioritise their mission – whether it is environmental sustainability, social equality, or community development – over immediate financial returns. This can result in slower growth, limited revenue generation, or business models that are not easily scalable.
Another point is, these startups target niche or underserved markets, such as rural communities or specific groups. While these markets are crucial for driving social change, they are often smaller, limiting the startup’s potential for rapid expansion. Besides, impact-focused businesses frequently operate in regions with challenging infrastructure or underdeveloped economies, leading to higher operational costs and lower profit margins.
The dual focus on social impact and financial sustainability makes it harder for these startups to clearly measure success. Investors prefer clear, quantifiable metrics to assess growth potential, but social impact outcomes – like improving community health – are more difficult to quantify and translate into returns.
These are the reasons why many traditional investors prioritise financial returns and view impact as a secondary consideration. While impact investors exist, they still demand scalable solutions, and impact-first models may not always align with their financial expectations. Social impact startups may find themselves caught between investors focused on profit and those focused on scalable impact, making it harder to secure funding.
Aurora Tech Award addresses two key challenges – early-stage funding for women-led startups and support for impact projects. It is more than just a global prize for women tech founders; it is about building communities, enhancing participants' skills, attracting VC attention to impactful women-led startups.
Being an annual global prize set up by inDrive for women entrepreneurs in IT, the Aurora Tech Award provides financial support for the top 5 winners with an $85,000 prize fund, aimed at developing a strong educational program for the applicants and building a global community for women in IT. Experts from inDrive New Venture will help evaluate applications, provide feedback, and have a representative on the judging panel, with 100 participants to be selected for a pitching session, and 15 of these to advance to the final shortlist.
Celebrating results
Last years’ winners are recognised not just for economic metrics, but for the impact they create. For instance, 2022 Winner, Rocket Learning is impacting the lives of 2 million children in low-resource settings in India by releasing new ML-based features, engagement increased by 5-15%, and led to winning Google’s AI for Global Goals award, with $1.5 million in funding to improve early education for 30 million Indian preschoolers.
2023 Winner, Gwiji for Women, a mobile app connecting cleaners with clients in Nairobi, Kenya, providing jobs for women in difficult circumstances. “Towards the end of last year, we had 150 cleaners. After the award, we grew to nearly 1,000 in six months and became available on the App Store.”
Sarah Phiri-Molema, 3rd prize winner of the 2024 Aurora Tech Award and Founder of Deaftronics in Botswana, comments on the impact of the award: “Winning the Aurora Tech Award has truly accelerated our development and opened new doors for us. We participated in various other competitions, increased our visibility, especially outside our home country, and attracted the attention of international investors and potential partners.”
Launched in 2021, the Aurora Tech Award powered by inDrive has received 1,500+ applications from over 100 countries, with support from more than 20 VC partners, including WISE and EBAN. Between 2021 and 2023, finalists benefited from global educational and mentoring programs, gaining networking opportunities and expert guidance to develop the skills necessary to succeeded in the tech startup ecosystem.
This year 2018 participants submitted their projects to the Award; the winners will be announced in Spring 2025.
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