Hi. This is Paul Zellizer, and welcome to the AwarePreneurs podcast. On this show, we dive deep into wisdom from some of the world's leading social entrepreneur. Our goal is to help increase your positive impact, your profitability, and your quality of life. Before we get into today's topic, I have one request. If you could hit subscribe and do a review on your favorite podcast app, it helps more people learn how to have positive impact through a values based business. Thanks so much. Today, your guest is me, Paul Zellizer.

I am the host of the Awarepreneurs podcast, and we do once a month, a solo episode where I try to address one of the more current issues in the social impact business space. And our topic today is 3 challenges that social impact startup space now. Here we are. I'm recording this in the middle of March of 2024, and I'm seeing 3 significant issues that I wanted to just share some thoughts because they're coming up pretty regularly with the founders I work with and in the conversations that I'm having with colleagues and when I go to networking events. So I'm gonna tell you what these three issues are. We'll talk a little bit about them. I'll share some strategies you might consider that are helping founders navigate these issues. And when it's all over, I'd love to hear from you.

What are you doing? First of all, what problems are you seeing and what are you doing to address these issues here in 2024? So let's talk about what the issues are. Let's talk about the strategies and thanks for being on the ride. Number 1, access to funding. Pretty significant decrease in the overall funding in 2023, and I'm seeing that trend continue into 2024. What do you do about that, and how can founders navigate that? Number 2, I'm seeing a regressive social and political landscape, whether that's pushback on climate or the war on DEI initiatives, etcetera. We'll talk about what does that mean for you as a social impact startup? And number 3, building awareness and market demand when, you know, things are kind of crowded out there. If you were starting an impact startup 15 years ago, there was less awareness of those vocabularies and that type of approach to business. So there's more of a trend and more general awareness out there, But also there's more noise out there.

There's more people claiming to be an impact business, to have some relationship with the SDGs, sustainable development goals or ESG. People have heard that term before. So what do you do when there's more noise and there's more competition? How do you be skillful in that environment? So number 1, access to funding is more difficult. There is a article from Crunchbase, an organization that, you know, looks at startup ecosystem in the business environment. I'll put a link to it in the show notes. And in that article, they're quoting a 38% overall decrease in 2023 of available funding to start ups compared to 2022. The numbers they're using in 2022 overall in the US, it was 462,000,000,000 in 2022. In 2023, it was 285,000,000,000, and that is a 38% decrease.

And, certainly, when I'm talking to social impact start up founders, We're definitely hearing that it's harder to get capital and investors are asking for more diligence. It's taking longer. They're doing more homework. And also pay attention to things like your overall valuation. And if your valuation is too high, they're passing on investments that they might not have passed on before that they might have been really interested in. So what do you do when funding is it's just more of a challenging funding environment. So let's talk about a couple of strategies for that. Number 1, grow smart in the startup world, sometimes like faster and getting to bigger is better is, you know, the overall mindset.