TLDR:
- Venture capitalists have profited from innovative ventures, but value hasn’t been shared with all stakeholders.
- A new model, the Happiness Return Framework, aims to assess investments based on well-being and financial returns.
A new article discusses the impact of venture capital investments on stakeholders and introduces a new model called the Happiness Return Framework. The article highlights the following key points:
Venture capital (VC) investments have often prioritized maximizing financial returns over considering the well-being of all stakeholders involved, leaving many affected parties at a disadvantage. Recognizing the need for a change in this approach, a new framework called the Happiness Return Framework has been developed to assess investments based on their impact on well-being and financial returns.
The Happiness Return Framework defines happiness as individual well-being, taking into account both the conditions that affect happiness and how individuals experience these conditions. By incorporating data from sources like the OECD’s Better Life Index and Seligman’s PERMA Framework, the framework aims to provide a holistic view of a venture’s impact on stakeholders.
Through the use of this framework, venture capital firms can make more informed investment decisions that prioritize the well-being of all stakeholders, in addition to financial returns. By analyzing ventures and funds based on their potential to create integrated social and financial returns, investors can align their investments with the goal of creating value for society and the planet.
Overall, the Happiness Return Framework offers a way for venture capitalists to assess the impact of their investments on happiness across all sectors, helping them make more informed decisions and potentially driving a shift towards more comprehensive accounting for the true financial and extra-financial value of venture capital investments.
