NGP Capital, the global, growth stage investment firm, today announced the results of its latest research into how environmental, social, and governance (ESG) goals – including adherence to the UN’s Sustainable Development Goals (SDGs) – can affect a startup’s ability to attract investment in today’s global investment market and make it as a sustainable and viable business.
The research, which analysed 2,292 startups from across Europe, the USA and Israel, which were founded no earlier than 2015 and had raised at least one equity funding round, reveals that while 4.5% of non-SDG focused startups founded since 2015 have ceased operations, only 2.6% of SDG relevant, purpose-driven startups have closed shop.
Startups focused on Climate Action, Consumption and Production, and Affordable and Clean Energy are especially robust.
In addition, SDG startups (36.6%) are more likely to raise Series A or growth funding rounds than their counterparts without an ESG focus (26.1%).
However, SDG relevant startups do not have a similar edge on exits, with 7.3% non-SDG relevant startups founded in or after 2015 having exited in the last seven years, compared to 5.5% SDG relevant startups.
