{"id":43236,"date":"2023-10-20T15:27:06","date_gmt":"2023-10-20T15:27:06","guid":{"rendered":"http:\/\/startupsmart.test\/2023\/10\/20\/how-this-aussie-founder-convinced-tech-investors-to-back-his-socially-conscious-startup-startupsmart\/"},"modified":"2023-10-20T15:27:06","modified_gmt":"2023-10-20T15:27:06","slug":"how-this-aussie-founder-convinced-tech-investors-to-back-his-socially-conscious-startup-startupsmart","status":"publish","type":"post","link":"https:\/\/www.startupsmart.com.au\/uncategorized\/how-this-aussie-founder-convinced-tech-investors-to-back-his-socially-conscious-startup-startupsmart\/","title":{"rendered":"How this Aussie founder convinced tech investors to back his socially conscious startup – StartupSmart"},"content":{"rendered":"
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When Chuffed founder Prashan Paramanathan mentioned the word “charity” as he pitched his socially conscious startup to investors, he lost many of them straight away.<\/p>\n

\u201cThere was a subset of the tech investor group that heard \u2018charity\u2019 and immediately thought there\u2019s no money there or that my rich friends should be giving a grant,\u201d Paramanathan says.<\/p>\n

Chuffed is a Melbourne-based crowdfunding platform for socially-conscious projects that recently restructured its business from a charity to a \u201csocial benefit model\u201d<\/a> and secured a $1.1 million funding round led by Blackbird Ventures.<\/p>\n

In an AMA run by Blackbird Ventures, the founder describes how he eventually won the tech investors over.<\/p>\n

\u201cAs the process went on we trended to bias up on the traction story,\u201d Paramanathan says.<\/p>\n

\u201cBut I think that talking about the mission helped us because it signalled that we understood the problem and helped us convey why we cared, so it\u2019s still important to include.\u201d<\/p>\n

He says he pitched to both tech investors and impact investors, and actually founded the former more open to the Chuffed model.<\/p>\n

\u201cSurprising we found the tech investors as a whole more aligned,\u201d Paramanathan says.<\/p>\n

\u201cThey thought longer-term, they wanted to support us not assess us, and they had way more value-add experience in growing tech startups.\u201d<\/p>\n

Transforming the charity into a business was the best option to ensure Chuffed reaches its full potential, he says.<\/p>\n

\u201cInitially we thought that if you\u2019re doing \u2018social good\u2019 it was almost morally right to be a charity \u2013 that being anything else was somehow not genuine and your motivations are somehow polluted,\u201d Paramanathan says.<\/p>\n

\u201cIt\u2019s a really strange but prevailing view. But we changed mostly out of necessity. We wanted to grow faster, we needed capital, we didn\u2019t think we were shiny enough to raise philanthropic grants second time around and equity seemed like the best path.<\/p>\n

\u201cThe structure doesn\u2019t really matter as much as the values and the people do. How you behave towards each other and your customers is really the thing that determines whether you\u2019re delivering on your mission or not and that\u2019s structure-neutral.\u201d<\/p>\n

And he says that taking on external funding has only strengthened the startup\u2019s vision.<\/p>\n

\u201cRather than the capital changing us I think the ambition that goes with the capital has changed us,\u201d Paramanathan says.<\/p>\n

\u201cWhen you don\u2019t have capital you focus much of your effort on finding the next grant or round of funding. Having capita frees you from that for a period of time.\u201d<\/p>\n

In the Q&A sessions, Paramanathan also discussed the difficulties of being an introverted CEO, recalling one moment early on in Chuffed\u2019s life when Telstra PR gave him a \u201cstern talking to\u201d about being the \u201cdefault face\u201d of the company.<\/p>\n

\u201cI\u2019m pretty introverted which means that I don\u2019t particularly like putting myself on centre stage,\u201d he says.<\/p>\n

\u201cWhile I don\u2019t think being an introvert is a weakness it biases you towards things that don\u2019t require being exposed which may or may not be in the best interest of the organisation. This one has been a long learning journey for me in just noticing the biases and then checking with other people as to whether it\u2019s effecting decisions.<\/p>\n

\u201cThe only real way I\u2019ve found to mitigate is to hire people who like doing the other stuff, which we\u2019re on the path of doing.\u201d<\/p>\n

Follow StartupSmart on<\/em> Facebook,<\/em> Twitter,<\/em> LinkedIn<\/em> and<\/em> Soundcloud.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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