Dr Johannes Lenhard
Research Associate and Co-ordinator
Johannes Lenhard is an ethnographer of venture capital and homelessness, and currently the Centre Coordinator of the Max Planck Centre Cambridge for the Study of Ethics, the Economy and Social Change.
Having worked towards a better understanding of survival practices of homeless people in London and Paris for his PhD, he has in 2017 started a new research project on the ethics of venture capital investors. He is currently preparing the publication of his dissertation monograph as well as finalising a book on diversity and inclusion in VC and tech.
His writing has appeared in academic peer-reviewed journals such as City and Society, Housing Studies, as well as journalistic outlets including Techcrunch, Prospect, Sifted, Aeon, the Conversation and Crunchbase.
Measuring impact well – how venture capital investors are discovering ESG metrics and ‘becoming professional’
Venture capital investors – equity investors in technology startup companies – are part of a young and still mostly unprofessionalised industry. Small partnership and gut-driven investment decision making are still the norm – and audit culture and responsibility pushed to the sidelines. Until very recently, that is, when the techlash movement caught the most well-known companies built on VC investment from Facebook, Twitter and Google to Uber and AirBnB; with the critique of big tech started also more scrutiny of the investors from the side of the entrepreneurs but also the VCs’ investors (the limited partners).
Enter the wave of ESG (environment, social, governance) principles and stakeholder capitalism in 2019. Slowly, more and more VC funds are jumping on the bandwagon of ‘doing investment better’ with ESG frameworks, impact measurement and specialised metrics for early stage companies. Based on ongoing fieldwork in London with a group of venture capital investors, I want to observe how a culture of (specific) metrics arrives for the first time in the VC industry and what the effects this new system has.
Counter to other contexts, many of the newly implemented ESG metrics – e.g. around increasing diversity and inclusion, fair treatment of employees or environmental impact – are turning power structures for VCs upside down. Making investors report data for the first time seems to be leading to more pressure to ‘be good’ across various vectors. How much of it is window dressing will have to be seen.