Purpose Rounds™: How Startups Are Mobilizing Communities to Align Money with Values
In the world of startup financing, a new type of funding has emerged that is catching the attention of both founders and investors alike. This innovative approach, known as Purpose Rounds™, is not just about raising money—it’s about aligning a company’s values with those of its community. But what exactly are Purpose Rounds™, and why are they making waves in the startup world?
What Are Purpose Rounds™?
Purpose Rounds™ are a new category of financing for startups, similar to Community Rounds and IPOs, but with a unique focus. Mark Hubbard, Managing Director at Renew Venture Capital, coined the term after noticing that these rounds allow companies to connect capital with the kind of world they want to create. It’s not just about backing a trendy product or following the latest investment craze. Instead, Purpose Rounds™ are about supporting founders who are making a real impact—especially those who have been historically excluded from traditional funding opportunities.
“Purpose Rounds™ represent a great opportunity for companies to align their values with their communities – and vice versa. It’s deeper than investing in a piece of flashy tech or an influencer-led bandwagon of investors,” says Mark Hubbard. “It’s a way of connecting capital to the kind of world you want to see, and to back the kind of founders you believe in.”
The Power of Community and Purpose
At the heart of Purpose Rounds™ is the idea of mobilizing a community around a shared purpose. For many startups, this means opening up investment opportunities not just to wealthy accredited investors, but to anyone who shares their values and wants to see them succeed. This approach democratizes investing, making it possible for everyday people to put their money where their beliefs are.
Navroze Mehta, founder of Mela Artisans, one of the companies currently raising a Purpose Round™, captures this idea perfectly:
“We are really excited to democratize investing. It’s been in this bubble where investors typically have had to invest quite significant amounts of capital, usually $25,000 or more, to participate in any kind of offering in a startup environment. So the movement in the last few years has been a really brilliant way to allow anyone in the audience to participate in what they believe in and invest in it, and see the growth.”
Why Purpose Rounds™ Matter
Purpose Rounds™ are especially important for companies that are led by women, historically excluded founders, and those focused on creating a positive impact. These founders often face barriers when it comes to securing traditional venture capital, but Purpose Rounds™ provide a new way to raise funds and build a community of supporters who are genuinely invested in their success.
For example, All Better Co., a startup that has reimagined how we treat bumps, bites, and bruises using plant-powered products, is currently raising a Purpose Round™. Founded by two moms on a playground, the company aims to scale its production, expand retail partnerships, and continue to innovate in the personal care market. By allowing both accredited and non-accredited investors to participate, All Better Co. is giving its community a chance to grow alongside the company.
How Renew VC Supports Purpose Rounds™
Renew Venture Capital plays a key role in helping companies launch their Purpose Rounds™. The team at Renew VC oversees the entire process, from designing the story to managing the logistics, so that founders can focus on what they do best—mobilizing their community and scaling their impact.
“The fundraising process is both expensive and complex. Founders may not have legal counsel on retainer, nor completely understand what an Edgarizer or a Blue Sky filer is – and that’s completely okay; that’s why we’re here to help,” says Kt McBratney, General Partner at Renew VC. “We do the heavy lifting so that founders can do what they do best – mobilize their community and scale their impact.”
The Future of Purpose Rounds™
As more startups embrace Purpose Rounds™, the landscape of startup financing is beginning to change. This new category of funding is helping to create a more inclusive and purpose-driven startup ecosystem, where communities can invest in the companies they believe in and benefit from their growth.
Whether you’re a founder looking to raise funds or an investor looking to make a difference, Purpose Rounds™ offer a powerful way to align money with values and create the kind of world we all want to see.
For more information on Purpose Rounds™, visit purposerounds.com.
