The Open Call for the New Media Ventures Innovation Fund closed a few weeks ago. We have just passed the first milestone in the diligence process: we eliminated applicants from our evaluation pool because they did not fit within our funding focus.
We got a record number of applications with this open call – a 25% increase compared to our Open Call last winter. We’re glad the word is spreading about the Innovation Fund! In addition, 65% of applicants reported having a woman on the leadership team, and 60% reported having a person of color on their leadership team. We couldn’t be more proud that the Open Call helps reach innovators that are too often overlooked by traditional investors.
86% of applicants reported that is was easy or somewhat easy to assess whether their work was a fit for NMV’s investment scope. In spite of this, we eliminated over half of the applications we received. This tells us we need to do a better job of explaining the types of innovation we fund. The purpose of this post is to explain why we have declined to further evaluate some applications, and help the startups that apply for our next Open Call this winter determine whether they are a fit. Here are the main reasons we rejected applications:
- Lack of progressive impact – We are exclusively focused on funding companies and organizations that can have significant positive impact. We reviewed cutting-edge technology or media startups, but without a demonstrated commitment towards making the world a better place, we did not evaluate them further.
- Non-US focus – Our work focuses on companies and organizations that can have an impact in the US. For groups that are working abroad, we look for a significant presence in the US, impact in the US or serious plans to grow your impact here.
- Too early – Startups that were only ideas, with no team or proof of concept were often turned down, unless the idea had incredible potential impact or there were other reasons to believe the idea was feasible (incubated by existing organization, team with relevant expertise, etc.)
- Not scalable – We use a venture-capital lens to evaluate applications, meaning we look for solutions that can grow fast in terms of impact and revenue. This means that startups with a limited geographic focus, or small target population, were not a fit for us even if they tackle important issues. Similarly, startups that focus exclusively on content production (e.g. producing documentaries) or are consulting firms, were ruled out.
- Research – NMV does not fund academic research. We are interested in startups applying cutting-edge research and scaling solutions but we don’t directly fund academic research.
- Not working to change the balance of power – We are most interested in innovative ways to reach, influence and mobilize people at scale towards progressive causes. In particular, we tend for fund startups working to change the narrative, culture and beliefs in the US, to empower and accelerate advocacy and to increase citizen engagement. That said, the wide variety of applications we receive for each open call helps us test the boundaries of our investment hypothesis so we often encourage startups to apply “when in doubt” and push us to stretch our thinking.
We are currently evaluating applications in more detail and will select the most promising ones to interview by the end of this week. We’ll continue to share what we notice and learn along the way. It has been incredibly inspiring to see the breadth and depth of the work mission-driven innovators are doing today. Thank you to everyone who has applied to our Open Call for sharing your work with us.