Money & Purpose

If you can get over the shock of that headline, stick with me.

 

I appreciate the ask is close to asking you not to breathe.  I’m not asking you to stop making money, just to stop focusing all your energy and attention on the money.  

 

So, what do we want you to focus on with the leadership teams in your portfolio companies?

It’s relatively simple -Purpose.

 

 

However, before you jump to all things ESG and sustainability, let’s ensure we are all on the same page.

 

To us, purpose has a very broad meaning and can be very personal to an individual.  The dictionary definition of purpose is ‘the reason for which something is done or created or for which something exists’. 

 

When we talk about purpose it is this definition that we are using - purpose which has meaning and reason for an individual. 

 

Making money is an output which some people can buy into very easily; particularly investors and leadership team members within portfolio companies.

 

 

 Why? Because they benefit the most from chasing money.

 

Growth in personal wealth is a huge driver for many and that is completely understandable – it provides a sense of security, financial stability and feels like a just reward for the many years of effort that goes into starting and scaling a business.  We are not knocking it.  However, most people need more – they need a purpose that is meaningful and impactful for them.  

 

Simon Sinek has talked powerfully about the importance of inspiration and purpose for years.  He may have focused on global leaders and their impacts on the world, but purpose is universal – we all need it.  

 

This is particularly true when facing into uncertainty and experiencing change because purpose provides direction, clarity and a focus on doing the right thing.  

 

We see one flavour of purpose in the rise of BCorps (over 2,000 in the UK now) and the importance of ESG goals in businesses. 

 

We also know that 89 percent of investors consider ESG issues in some form as part of their investment approach, according to a 2022 study by asset management firm Capital Group. 

 

So, if we can understand the importance of purpose in the context of saving our planet then it is not too much of a stretch to understand its broader definition when engaging with the stakeholders of a business.

 

 

What drives them? 

 

What fires their passion for their work?  What keeps them awake at night yet also gives them the energy to get up in the morning? 

 

 

Our focus at Equator is on helping businesses to grow and, if we accept that growth is change by another name, then the starting point is often understanding the purpose that is important to customers, team members, partners and investors. 

 

 

Purpose is the ‘Why?’ we all do what we do. 

 

If we understand that – at an organisational and individual level - then we can help a business to drive change that has meaning for the value creators.  How do we achieve that?   

 

• Creating a compelling case for change that is brought to life by values that are visible, lived & protected  
• Supporting leaders to be authentic, engaged and constantly learning 
• Driving the management of change in a way that reduces uncertainty, protects the creation of value and focuses on people

 

There is a phrase for looking beyond your own personal gain – enlightened self-interest.

 

Not a new concept at all and pretty easy to explain – it’s the opposite of greed.  McKinsey call it out as an imperative for business leaders in relation to technology adoption in their paper ‘Tech for Good’ - Using technology to smooth disruption and improve well-being. 

 

We are calling it out in terms of investment in businesses.  If we worry less about the money and worry more about the values, leadership and management of change within businesses then the purpose will feel real to people and their ability to drive value will grow with the business. 

 

 

So, in conclusion, let me rephrase our ask to investors – ‘If focusing on values, leadership and change management could make you money, would you do it?’