Julia Profeta Johansson started working as a sustainable investor as an adult. But her story of finding a job that was a good fit for her ethics began when she was still a teenager in Campinas, Brazil, where she volunteered for causes thanks to her local church and carried out pro bono work as a strategy consultant for nonprofits. She wanted to learn a lot and make some money, so she studied business and ended up going into investment banking. But despite Johansson mastering the trade of financial markets, investment, credit, she ended up having a serious burnout. “This burnout showed me that while it was an interesting path, it didn’t align with my own values and what I wanted to actually be.”
After another false start, real change came when she learned about the work of Professor Muhammad Yunus. Professor Muhammad Yunus won the Nobel Peace Prize in 2006 and created the concept of microfinance in Bangladesh in the ‘70s. His work harnesses finance to leverage people out of poverty and Julia tells me that he’s often referred to as “the banker of the poor.” Julia notes that on discovering his work, she realised that money that goes into philanthropy only gets used once, but “by investing into a social business, impact investment has several lives because a business has to be self-sustaining. This gave me the idea of bringing leverage and structure to the worlds of social and environmental impact work.”
Julia ran accelerators in São Paulo and Rio de Janeiro, creating the first accelerator uniting entrepreneurs from the slums with middle-class entrepreneurs. She also worked at Vox Capital, the first VC doing impact back in Brazil. Her voice grows warm when she talks about her time there: “Vox was the first one to show that truly you can do both, you can have financial returns while you create social and environmental impact.”
After moving to Berlin in 2017, she tried to continue to work for Vox but the time difference made life too complicated. Instead, she started working for several different accelerators where she tried to create awareness around the topic of impact investments, which she defines as “investments and business that are entered into with the intention to generate both financial and social and environmental results at the same time.”
Julia’s life in Europe led her to contemplate existing problems. One was that of how few women seemed to be engaged in the financial world, a topic she’d been thinking about even before Berlin. Back in 2016, an investor asked her, “Do you think it’s normal that you’re the only one at the table as a woman? That you’re the only one speaking at panels?” It really brought it home to Julia that no, of course this wasn’t right.
“Coming from the world of banking and tech and VC and impact, you start finding it normal that you only ever see men. This moment really made me think I needed to do something about that — something to empower women and create more opportunities for them.” In response to this, she founded Ella Impact, a network of women connected around the topics of impact investment and business.
Another issue was that of the VC structure – the tendency, as Julia puts it, to only chase unicorns instead of considering zebras (companies that are profitable and improve society) as well. After meeting her co-founder Sebastian Dienst through a mutual acquaintance, she found he was looking for a co-founder at the same time she was considering what her next venture would be. Together, they decided to fill a gap in the market, creating a financial partner who aimed to work with companies in the long run.
“We wanted to incentivise them, use money differently to inspire them to create change.” Their project, Remagine, is a B2B bank that offers the usual banking products (bank accounts, transactions, cards) but also offers founder-friendly funding and revenue-based finance.
“We wanted to really question who we choose to incentivise, who we give discounts to, who we give better interest rates to. Are we doing this just because the company is performing well or is it because they perform better and they have impact?” If a company can prove their impact, they get a free account. They’re also developing access for better interest rates for this type of company “because we do believe that in the long run, the more impact a company has, the more successful it will be.”
After all her years in the impact investment world, what advice would Julia give to green startup founders for securing investment? She considers the question for a moment. “Regardless of your impact, you need to have a very robust product and business model, right? So what we always say is that it’s not impact that pays your bills but it’s going to guarantee your survival in a way because the better your product is, the more impact you’re going to have and the better you’re going to connect with your stakeholders.”
She also talks about the importance of considering all sources of fundraising: right at the beginning, potentially looking to friends and family for support and as a green startup, considering the way governmental programs or grants might contribute support.
“Also,” she adds, “one tip that I always give is that money does have color and smell at the end of the day. I mean this in the sense that if you bring in an investor who is not so aligned with your vision, they’re going to mess up with your strategy. So making sure you’re bringing in people that will really collaborate with your building of the vision is super essential.”
What about what happens when a startup secures funding – how can they spend a limited amount wisely? Julia notes that one of the biggest challenges founders face is one that’s often overlooked: how exhausting fundraising is. She suggests shooting for an amount that allows you to re-engage with your business. “When you look across Europe, investors are still a bit slow, negotiations take time — it can often take six months for a round to actually close. So if you actually manage to secure enough money to cover your runway for like 20-24 months, actually that also allows you to dive deeper into your business again instead of fundraising all the time.”
In terms of spending that money wisely, she advocates for constantly checking back in with your customers. “Talk to your clients. Do customer research. Because they’re going to be the best ones to tell you what they want and when and then you’re going to be able to say OK, what kind of personnel do I need to bring in? What do I need to invest into marketing in order to attract awareness?”
While we’re broaching tough questions, I clear my throat. What about the prejudice that sustainability is incompatible with profit? Is there any truth in it? Julia is brisk: there’s already data showing that companies and funds dealing with sustainability actually perform better than their less-sustainability focused counterparts. Julia also gestures to a societal shift: millennial and Gen Z consumers now expect more from companies than simple profit making.
“So at the end of the day, if we don’t take all stakeholders into consideration when creating a business, we’re going to miss out on connecting better with the consumers that are going to make a company great. Sustainability is a matter of understanding that again, it’s not a short-term return, it’s the long-term survival of humanity. And the numbers are showing us that already.”
Julia Profeta Johansson answered the question of “What is the next big thing in green tech?” alongside Syed Abbas from 2Cimple, Melanie Kubin-Hardewig from Deutsche Telekom and Marcin Maciejewski from hubraum at the hubraum on air event on February 25th. Check out the replay here.
Are you a part of a startup, company, or simply an individual launching your own developed project focused on network sustainability? Check out hubraum’s Network Sustainability Award to win cash prizes and an opportunity to develop a proof of concept or prototype with Deutsche Telekom as well as its partners.