Love, leadership, and investment: we all encounter these seemingly straightforward concepts in our daily life and work. But for a long time, I got it all wrong. I used my head when I should have followed my heart more, and trusted my heart when I should have consulted with my head more. This is the stuff we agonize about before we sleep, although perhaps not quite in these terms. We associate the heart with love affairs — that deep infatuation with people, ideas, or experiences. We don’t tend to mix musings on love with the realm of work, because our work culture is dominated by rationality, performance and efficiency. Yet I’ve come to realize that love and work can be much more intertwined.
We gain and lose as many things we love float in and out of our lives. It’s not until we lament this transience that we finally begin to grasp our appetite for feeling, and along with it our enormous capacity to balance rational thinking with empathy and compassion. Such awareness took me down an unconventional path of leadership and investment, sometimes not without controversy.
Who doesn’t want to see measurable impact? Investing in impact is a risky business, but not so much in terms of fear of failure or financial loss. The biggest misstep is in assuming that we can quantify impact to match our investment, which limits our vision, impairs our judgment, and sends us running backwards to what we perceive as rational and safe. And that’s never where impact lives.
At Yoxi, we seek out leaders who think differently about love, leadership, and investment. There’s a process around encouraging the presence and interplay of all three to make positive change. I’m still learning every day, and here are some observations:
To lead is to trust
A more traditional view would have us believe that sustainable social progress stems from our ability to ‘trust the system’, but how can we when so many systems are inadequate or crumbling? Try switching around that sentence. Sustainable social progress stems from our ability to trust the disruption of existing systems.
A new global economy is emerging. In it, there’s an opportunity to reimagine the role of capital in balancing purpose and profit. Social entrepreneurs and benefit corporations (‘b-corps’) are growing in numbers, and philanthropy is shifting from grants to investments. This is not a trend. This is a beginning.
In this new era, enterprise isn’t about legal structure, but about getting things done. Investment isn’t just about financial return, but about being emotionally engaged in the process of change.
To live with new systems that we can trust, we must first step forward and build these systems with trust. This means experimenting with building blocks that are softer, more intuitive and intangible. It also means being comfortable with ambiguity and uncertainty. And most importantly, it means trusting the people we invest in to make change happen.
Bring unconditional love to business
When we focus on the sustainability and scalability of ideas — but free ourselves from having to prescribe an exit point — we make space for big change. This approach requires a tremendous amount of time, patience, and courage. Therefore the engine that drives our work has to be pure love. With every investment decision at Yoxi, we ask ourselves if we have the capacity to give unconditional love to the entrepreneur/business being considered. If the answer is no, it often means that we are not looking at the right match.
Perhaps this point of view is a bit radical. But if we can erase the line that has been artificially erected to divide ‘business’ and ‘charity’ for tax purposes, we will soon realize that the driver for impact isn’t binary. When a business is built with authentic love and leadership, its financial and social return should be balanced. Yoxi’s investment philosophy requires us to be meaningfully engaged with the entrepreneur, the social mission, and the difficult journey to build lasting value. That’s why our term sheet looks different. Measurable impact is a mandate, but we don’t want our assessment metrics to limit the entrepreneur’s appetite for (or our tolerance of) risk.
Invest in leadership potential
Leadership is a relationship. Like any other types of relationship, it’s deeply dynamic and personal, without a set of hard and fast rules to follow. Cultivating it is an honest and emotional pursuit that requires the presence of vulnerability. Social innovators may not be business experts (although many are) — they’re a unique blend of artists, scientists, humanitarians and activists. Investing in them means celebrating their brilliance as well as accepting their flaws.
When we fall in love with bold social entrepreneurs who display passion, ambition, and conviction, we don’t just invest in the ideas they bring to the table. Instead, we invest in their potential to become transformational leaders. We help them to develop a highly personalized growth map that sees successful social ventures as only means to an end. The end game is to arrive at the kind of enlightened leadership that opens up new possibilities beyond our current imagination.
Love investment is a state of mind
The philosophy of love investment places its emphasis on instinct more than expertise, trust more than calculation, truth more than ambition, and respect more than control. It’s not a skill to hone, but rather a state of mind to reach.
Our return on this investment is the emotional reward of partnering with leaders who then go on to change the life of millions. We’re lucky to have the financial resources and human capital to match our beliefs. We want to be sure that when we choose to support social innovation, we play the unique role of encouraging creativity, generosity and honesty. Transaction-based investment can only scale in quantity, after all. Love investment taps into the realm of undiscovered potential, and true leadership sees no limit on the upside.
Sharon Chang is a designer, media executive, social entrepreneur, impact investor, and philanthropist. Prior to founding Yoxi, she was the Chief Creative Officer of 19 Entertainment, the company behind popular TV shows American Idol and So You Think You Can Dance. She is also cofounder and board member of many startups, social ventures, and nonprofit organizations around the world.