From Venture Capitalist to Venture Catalyst

How investors can play an active role in transformation through targeted support of impact startups

Venture Capital is optimized to finance rapid growth and achieve high returns in a short time. Impact startups, on the other hand, often work on profound, systemic changes — whether in renewable energy, circular economy, or deep-tech solutions for global challenges. This type of innovation needs more than just capital: it requires time, specialized networks, and strategic guidance that goes far beyond the traditional VC approach. But this is precisely where the problem lies.

Many investors with an interest in impact underestimate what it really takes to build a sustainable business model in deep-tech or social innovations. Money can enable the first development step, but it does not replace the crucial resources that startups need: market access, regulatory expertise, and experienced partners who scale with them. Without this support, promising innovations often fail not because of the technology, but because of the missing infrastructure for market entry.

Credit: Shannon Rowies via Unsplash

The classic VC model is designed for exits — usually within five to seven years. However, many impact startups need significantly longer to become economically viable. Scaling here often means not just higher user numbers, but also regulatory adjustments, complex industry cooperations, or the development of new infrastructures. The typical VC logic of rapid scaling and aggressive growth often contradicts these real market conditions.

The consequence: Many impact startups either have to bend themselves to meet classic VC expectations — and lose sight of their actual mission in the process. Or they don’t receive the necessary financing at all because their time horizon doesn’t fit into the common investment model. But there is a solution: Investors must evolve from pure capital providers to Venture Catalysts — active co-creators who strategically advance startups with knowledge, networks, and strategic support. How this works will be examined in the next section.

The New Role of Investors

Many investors believe they’ve done their job once they’ve funded a promising impact startup. But capital alone doesn’t make innovation take flight. Especially in industries with regulatory hurdles, long development cycles, or complex market structures, high cash flow is not enough to enable sustainable scaling. The true leverage only emerges when investors actively contribute their knowledge, network, and strategic experience.

From Silent Partner to Active Co-Creator

A Venture Catalyst thinks beyond funding rounds and actively accompanies startups at critical junctures:

• Regulatory Hurdles: Those scaling a MedTech or Climate-Tech startup often struggle not with technology, but with bureaucracy. Investors experienced in these markets can help navigate approval processes and build strategic partnerships with authorities or industry partners.
• Go-to-Market Strategy: Many Deep-Tech startups have groundbreaking technologies but no market access strategy. An investor with industry expertise can help identify the right pilot customers and scaling partners.
• Talent & Team Building: Growing a company sustainably requires not just capital, but also the right leadership. Investors with strong networks can help fill key positions with experienced experts.

A Venture Catalyst doesn’t wait for the next reporting meeting but sits down with the founders to actively work on solutions.

Impact Investors as Enablers: Why Alignment is Crucial

The best impact investors don’t see themselves as neutral financiers but as partners with a clear mission. Yet too often, misunderstandings arise between capital providers and founders because impact definitions diverge. While startups often work on long-term, systemic solutions, many investors expect rapid scaling and high margins. This leads to poor decisions that either dilute the business model or derail the startup.

A true Venture Catalyst ensures that investors and founders pull in the same direction. This means:

• Common Goal Definition: Instead of looking at classic VC metrics like “runway” or “growth rate” in isolation, impact-relevant KPIs must be included.
• Flexible Time Horizons: Not every innovation can deliver an exit within five years. A Catalyst helps develop alternative financing strategies.
• Value Creation Instead of Short-term Returns: The success of an impact startup is measured not only in revenue growth but also in its actual impact. Investors who understand this can help build sustainable business models rather than pushing for quick profits.

The transformation from classic Venture Capitalist to Venture Catalyst isn’t a nice-to-have — it’s the prerequisite for impact startups to truly realize their potential. But what exactly does this support look like in practice?

Three Levers That Turn Investors Into Real Gamechangers

Investors who truly want to advance impact startups need three crucial levers: market access, operational support, and long-term impact orientation. Those who use these levers correctly change not just the individual startup but entire industries.

Market Access Beats Funding: Why Networks Are the True Multiplier

Money alone doesn’t open doors. Especially in regulated or highly fragmented markets, it can take years before a startup wins its first relevant customers. This is exactly where an investor’s networks pay off.

• Pilot Projects Instead of Pitches: Many tech startups struggle not with technology but with the question: Who will test it? A strategic investor can use their network to arrange first pilot customers or industrial partners — dramatically lowering the market entry barrier.
• Regulatory Expertise as Door Opener Instead of Blockade: Those investing in HealthTech, ClimateTech, or FinTech know the endless approval procedures. Investors connected with regulatory authorities, industry associations, and political decision-makers can accelerate this process — or at least make it more navigable.
• Cooperation Instead of Competition: The biggest mistake many startups make is appearing as competition in existing markets rather than collaborating with established players. Investors with experience and networks in the industry can build bridges — to corporate partners, industry alliances, or relevant supply chains.

Capital is useful, but a single good contact can create more value than an entire funding round.

More Than a Board Seat: How Investors Enable Real Growth

Many investors see themselves as financiers who attend a reporting meeting once a quarter. But real growth doesn’t come from Excel sheets, but through active support in operational business.

• Talent is more crucial than technology: Many impact startups have brilliant ideas but not the right team to scale them. Investors with a strong talent network can help find the right executives, sales experts, or product specialists — and thus significantly accelerate growth.
• Strategic sparring partners instead of passive observers: The best investors don’t just sit at the table during board meetings, but actively help with critical decisions: When is the right time for internationalization? Which pricing strategy makes sense? How do you balance impact and revenue?
• Processes that enable growth: A big deal can ruin a startup if internal structures don’t scale. Investors who have experience with hypergrowth phases can help set up the right processes in time — from financial controlling to supply chain optimization.

Those who only provide capital and then sit back are leaving enormous potential untapped.

Impact Without a Long-term Strategy? Doesn’t Work.

Many investors demand measurable KPIs from impact startups — without understanding that real change often only becomes visible in the long term. Those who want to finance impact must have patience.

• Scalability begins with measurable impact: The most successful impact startups have defined clear metrics from the start: CO₂ savings per product, number of people served, reduction of resource consumption. Investors must not only ensure that these KPIs are recorded — but also that they are strategically incorporated into scaling.
• Long-term financing models instead of exit pressure: Classic VC funds often rely on a quick exit after 5–7 years. But many impact innovations need longer development cycles. Smart investors rely on flexible financing models — such as evergreen funds or revenue-based financing — to enable sustainable growth.
• Impact as a value driver, not a side effect: The biggest mistake is evaluating impact startups by the same standards as classic software startups. Those who really want to scale impact must understand it not as a PR argument but as an economic success factor — and deliberately integrate it into business models.

Those who only focus on rapid scaling without seriously incorporating impact into their investment strategy will have neither financial nor social success in the long run.

Venture Catalysts who actively contribute with networks, operational support, and a clear impact strategy not only have more leverage — they are also more successful in the long term. Because the most exciting companies of the future will not only be economically strong but will also solve real problems.

But what exactly does this look like in practice? In the next chapter, we analyze concrete examples of successful Venture Catalysts — and what other investors can learn from them.

From Capital Providers to Strategic Partners: How Investors Accelerate Real Impact

Especially in the Climate-Tech and Deep-Tech sectors, it’s becoming clear that investors who offer networks, expertise, and strategic support beyond capital have the greatest influence. Two outstanding examples of this shift are the BDC Climate Tech Fund II and the Swedish impact fund Norrsken VC.

The Climate Tech Fund II of the Business Development Bank of Canada (BDC) goes far beyond the classic venture capital model. With a volume of 400 million dollars, the fund specifically supports Canadian cleantech startups developing technologies for CO₂ reduction and energy transition. BDC pursues a long-term strategy: Instead of just making seed investments and hoping for quick exits, the fund focuses on substantial follow-on financing.

For startups, this means not only financial security but also access to regulatory and market knowledge as well as industrial partners who help them implement pilot projects and grow from niche to mass market. This scaling barrier is the biggest hurdle for many climate-tech startups — and this is exactly where a pure capital provider becomes a real Venture Catalyst.

Another role model for strategic impact investing is Norrsken VC, a Swedish fund. Norrsken invests exclusively in startups that have the potential to positively impact a billion people — a consistent impact-first approach that goes far beyond conventional ESG criteria.

What makes Norrsken different?

• Impact as a hard KPI: Every investment must not only be economically viable but also have a measurable, long-term positive influence.
• Networks as a scaling factor: Norrsken VC is closely interlinked with global organizations, family offices, and institutional partners. Startups benefit from an ecosystem of co-investors, regulatory authorities, and strategic partners.
• More than a fund — an ecosystem: The Norrsken House in Stockholm is an impact hub with over 350 startups, NGOs, and investors who support and scale each other.

Norrsken VC shows that real impact investors must actively shape rather than just provide money. They build ecosystems, consistently measure impact, and create structural prerequisites for growth.

Those who want to accelerate real innovations must think long-term, build strategic partnerships, and actively accompany startups beyond funding rounds. This is exactly the difference between a pure capital provider and a real Venture Catalyst.

Success Factors for Venture Catalysts

Many investors now know: Impact startups don’t work according to classical VC rules. But what does this mean specifically for their investment strategy? Those who see themselves as Venture Catalysts must not only actively support startups but also rethink their own mechanisms — from financing models to incentives within their own fund.

Quick Exit? Quick Mistake.

Traditional venture capital funds are designed for rapid scaling and exits within five to seven years. This might work for a new social media app — but not for a technology that’s transforming the global energy system or establishing a completely new type of agriculture.

Impact startups often have long development cycles, regulatory hurdles, and require high capital investments for infrastructure and production. Those looking for a quick exit here often destroy exactly the potential that could bring the greatest impact in the long term.

Venture Catalysts therefore rely on “Patience Capital” — long-term oriented capital that focuses on sustainable value creation rather than the fastest possible sale.

Money is plentiful — but is it the right kind?

Many impact startups fail not because of technology, but because of financing. Classic VC funds want exponential growth in a short time, banks demand early profitability, and public funding is often bureaucratic and slow. That’s why Venture Catalysts need new approaches:

• Revenue-Based Financing: Instead of rigid equity stakes, startups pay back a fixed percentage of their revenue. Perfect for companies that can scale but aren’t yet showing profits.
• Evergreen Funds: Instead of a classic “10-year fund,” some investors opt for permanent capital structures that can continuously reinvest in new and existing companies. This gives impact startups the time they need.
• Blended Finance: Combination of public funding, philanthropy, and private capital to finance high-risk projects with social added value.

Questioning incentive systems: Are investors geared toward impact or quick returns?

An underestimated factor for the success of impact startups is the incentives within the investor community itself.

• If fund managers are measured by IRR targets (Internal Rate of Return) within a few years, there is no incentive to invest in impact for the long term.
• If fund structure and bonus systems are only oriented toward exits, the startup will inevitably be pushed toward a quick sale — regardless of whether that would be the best path.

Venture Catalysts must therefore restructure their own systems:

• Integrate impact as a KPI in fund performance (not just “nice to have”)
• Tie employee bonuses to long-term success rather than short-term returns
• Convince capital providers that sustainable value creation means higher resilience

Those who don’t change the rules will never scale impact. Investors can no longer be content with just providing money and hoping for the next unicorn exit. Venture Catalysts think further: They create smarter financing models, give startups more time, and set impact as a true measure of success. Impact cannot grow by the same rules as classic VC investments — so investors must be willing to change the rules themselves.

Conclusion: Rethinking Impact Investing — Investors as Active Shapers of Change

Impact startups have the potential to transform entire industries — yet they often fail not because of technology, but because of the wrong investment mechanisms. Those who want real change must do more as investors than just provide capital. Venture Catalysts think bigger, accompany more actively, and invest more long-term.

1. Capital alone is not enough — impact needs active support
   Impact startups need more than financing. They must gain access to regulators, industry partners, and pilot projects to test their technologies in the real world. Successful investors broker partnerships, help build supply chains, and provide support with regulatory issues. Those who just invest and wait for the exit remain spectators. Those who actively shape make impact scalable.
2. Networks and expertise are just as valuable as money
   Venture capital is often referred to as “smart money” — but for impact startups, it’s not just financial knowledge that counts, but strategic industry expertise. Many innovations fail not because of technology, but because of missing customers or political hurdles. Investors who specifically facilitate contacts with industry, science, and politics significantly increase the chances of success.
3. Long-term orientation beats short-term exits
   Impact startups need time for research, market entry, and scaling. Classic VC models with 5- to 7-year exits often don’t fit. Alternative financing models like revenue-based financing or evergreen funds give startups more flexibility. Funds like Norrsken VC measure not only financial returns but also societal progress.

Startups alone cannot manage the transformation. It takes investors who grow with them. The central question is no longer whether impact startups can find capital — but whether investors are ready to change themselves.

What now? First steps for investors

The transformation from classic Venture Capitalist to real Venture Catalyst begins with an honest assessment: Where can investors create real added value beyond capital? Those who want to specifically support impact startups must see themselves as long-term partners — not just as financiers, but as active shapers.

• Analyze your own portfolio: Where are there levers for active support?
  Not every startup needs the same kind of support. A climate-tech startup faces different challenges than a health-tech company. Investors should carefully examine their portfolio companies: Where is market access missing? What regulatory hurdles exist? Where could strategic connections help scale faster? A structured portfolio assessment quickly shows where the greatest leverage lies.
• Co-founder mentality instead of just being a financier: How to create real added value as an investor:
  The most successful impact investors don’t act as passive capital providers but as co-creators. This means: Delving into the business models, actively thinking along, and accompanying strategic decisions. An experienced investor can ask the right questions through targeted sparring, avoid wrong decisions, and accelerate innovations. Crucial is a genuine exchange on equal footing — not just between board meetings and quarterly reports.
• Build strategic partnerships with incubators, accelerators, and venture studios:
  Impact startups benefit enormously from strong ecosystems. Investors who cooperate with incubators, accelerators, and venture studios create access to relevant networks and resources for their portfolio companies. Especially in deep-tech and climate-tech sectors, close collaboration with subject matter experts and specialized programs can make the difference between a promising idea and a scalable solution.

Impact investing requires a new mindset. Those who really want to change something should ask themselves: How can I contribute more than capital? The best investors are not just financiers — they are accelerators of change.