MICROFINANCE | Major Sustainability

CORPORATE INNOVATION & ENTREPRENEURSHIP AND SUSTAINABILITY

Embedding Sustainability in Entrepreneurship

In 2015, John Sylvan, the inventor of the K-Cup, told James Hamblin of The Atlantic that he regretted his invention: “I feel bad sometimes that I ever did it.” Today, around 40% of American households have a single cup coffee maker and some estimates the number of K-cups in landfills could circle the earth 10 times (Statista, Story of Stuff Project). Keep in mind that research consistently shows landfills are sited in poorer communities and communities of color.

Why was sustainability not a part of Mr. Sylvan’s new venture creation process? Why was there not a step to consider social and environmental impacts (intended or not)?

Clearly for sustainability to be most effective, it needs to be fully incorporated into core innovation and entrepreneurship processes. Two cornerstones to many courses in new venture creation and entrepreneurship are the Lean Startup methodology and Business Model Canvas. Let’s explore how these already excellent models can be upgraded to include opportunities for social and environmental innovation.

Leaning Into Sustainability: Expanding the Lean Startup Model

The Lean Startup by Eric Ries has become not only a popular book used in entrepreneurship and new venture creation courses–but a popular mindset and methodology. It popularized terms like “minimum viable product” (MVP) and amplified calls by luminaries like Steve Blank to “get out of the building” and actually talk with customers. The focus should be, the lean startup approach emphasizes, a “return on learning” for startups, not a narrow focus on return on investment.

However, the core Lean Startup Model (shown below) completely leaves out consideration of social and environmental impact. It needs to be updated to a Sustainable Lean Startup Model that also calls for “getting out of the building” but not only to talk with customers, but to explore, analyze and understand the community and social issues your venture can address, and the environmental concerns or benefits that should be considered.

Traditional Lean Startup Model
(Image source: The Business Model Analyst)

Sustainable Lean Startup Model

Modeling the Right Outcomes: Upgrading the Business Model Canvas

Another popular model is the Business Model Canvas (shown below) which emerged from the book Business Model Generation by Alexander Osterwalder and Yves Pigneur. Used by many business schools, entrepreneurs, accelerators and venture funds, the Business Model Canvas was created to simplify and visualize business model creation. The authors’ hope is that it would allow for quicker business model creation, iteration, and ultimately towards better solutions.

However, like with the Lean Startup, the traditional Business Model Canvas also ignores social and environmental relationships and impacts. Fortunately, others have come forward with expanded frameworks like the “Sustainable Business Model Canvas” seen below.