Hugo Messer is a Dutch entrepreneur and investor based in Bali, Indonesia, known for his work in supporting tech and sustainable startups through impact investing. He is a venture partner at Addon Ventures, which helps build startups focused on health and environmental solutions by providing funding and support. Hugo also works with the Bali Investment Club, encouraging entrepreneurship and agile business practices to create positive impacts in Indonesia. His investments aim to deliver both financial returns and address important global challenges.
In the article, Hugo Messer discusses how impact investing should balance profits with social and environmental benefits.
Highlights
Why Impact Investing?
“I am an admirer of impact investing. I strongly feel that investors should shift from purely self-interested business practices to a more holistic approach that considers social and environmental impact. In this blog post, I’m sharing my thoughts on how embracing impact investment can lead to meaningful change and long-term benefits for all.”
Hugo Messer
Driving through traffic in Indonesia, the place I have called home for 8 years, I often feel that we are driving ‘together’. For example, in the West, people drive ‘against each other’. However, in Indonesia, people are more ‘relaxed’ while driving (and while doing most other things). In the west, people are stressed and they feel other people are obstructing them (resulting in lots of hand gestures and shouting).
In business, it’s not much different. Of course, worldwide, most business people are thinking ‘what can I get out of this’. How can I get ROI? How can I make more money? But in Indonesia, I’ve always felt that there is also a sense of ‘doing business together’. People want to help each other (once you’re in their hearts). If I win, you win, we are in it together.
Capitalism vs Impact
I read a passage a few weeks ago from ‘the second mountain’ by David Brooks which summarizes this paradox quite well:
“For six decades, the worship of the self has been the central preoccupation of our culture—molding the self, investing in the self, and expressing the self. Capitalism, meritocracy, and modern social science have normalized selfishness; they have made it seem that the only human motives that are real are the self-interested ones—the desire for money, status, and power. They silently spread the message that giving, care, and love are just icing on the cake of society. When a society is built around self-preoccupation, its members become separated from one another, divided and alienated. The rot we see in our politics is caused by a rot in our moral and cultural foundations, in the way we relate to one another, in the way we see ourselves as separable from one another, in the individualistic values that have become the water in which we swim.”
Impact Investing Is All About Us
Two years ago, I started my journey into impact investing (as a partner in BIC). I’ve done several angel investments myself, and I’m helping founders grow sustainable businesses. I now help investors make an impact while making more money. I believe impact investing is about ‘us’—community and solving big problems together. In the end, that brings more satisfaction to everyone involved.
Capitalism is like a vacuum cleaner. The rich, the big corporations, suck up most of the money. Shareholders want ROI, so there’s only one way for big companies: growth. If the corporation is doing things that help both the planet and people, growth will lead to a positive impact. But in many cases, there’s a downside to growth, which leads us to the boundaries of what our planet can handle. The basis for this vacuum cleaning is selfishness.
Investments in growing companies fuel capitalism. The premise is that the investor gets ROI. If we put money into the stock market, most people simply look at what makes the most money in the shortest amount of time. If we invest in non-public companies, we look at their financials and seek the ones that bring us stable returns and a potential big return at an exit.
The Need for Purpose-Driven Entrepreneurs and Investors
Impact Investing requires investors to think about a wider range of ROI. ROI on waste reduction, CO2 emissions, and income for poor people. I invest money into a business and expect my money to impact the planet, people, AND my bank account.
This requires a community effort and a shift in thinking for many people. Entrepreneurs must seek opportunities that solve problems for people and the planet while creating solid businesses. We need more true entrepreneurs who get to this point from their ‘entrepreneurial itch’ and drive to build a business (and make good money with that). We also need investors who want to make their money work beyond just financial returns. Investors who wish to see the ROI described above have the patience and time to support those entrepreneurs wherever possible.
Challenges We Need to Tackle
The big challenge for humanity is to make this shift from ‘me’ to ‘us’. I clearly understand that I need to create less CO2 and fly less, yet I still get into airplanes. I see our nature getting destroyed because everyone believes it’s their birthright to travel and explore the world and yet I still travel. But if everyone starts moving towards ‘us’ and ‘business for good’, I think we will slowly get there. A good starting point is to reflect on my own behavior regularly: when am I selfish? In business, do I go alone or together? In investing, do I think of my bank account only, or do I look at impact metrics as well?
When I drive in traffic on Bali, I am often inclined to swear at the guy who cuts me off, but every time that voice comes up, I think ‘we are in this together’. As a venture partner at Addon Ventures (an impact venture builder) and Bali Investment Club (an impact angel network in Indonesia), I’ve met lots of entrepreneurs and investors who care about making the world a better place. Feel free to get in touch with me for more insights on impact investing and how we can work together to create positive change.
