Proof Can Wait: Inside the Logic of Sustainable Venture Capital
(2025) ENTN19 20251Department of Business Administration
- Abstract
- This thesis explores how sustainability-oriented venture capital firms (sVCs) evaluate sustainability-oriented early-stage startups. While sustainability has gained prominence in financial discourse, its role in early-stage venture evaluation remains diffuse. Startups with strong sustainability missions often face investor hesitation; not due to lack of relevance, but due to limited standardization and the difficulty of assessing long-term impact under uncertainty.
Based on qualitative interviews with Swedish sVC professionals and analyzed using the Gioia methodology, the study builds an inductive understanding of how sustainability is interpreted, prioritized, and acted upon in real investment contexts. The goal is not to test theory,... (More) - This thesis explores how sustainability-oriented venture capital firms (sVCs) evaluate sustainability-oriented early-stage startups. While sustainability has gained prominence in financial discourse, its role in early-stage venture evaluation remains diffuse. Startups with strong sustainability missions often face investor hesitation; not due to lack of relevance, but due to limited standardization and the difficulty of assessing long-term impact under uncertainty.
Based on qualitative interviews with Swedish sVC professionals and analyzed using the Gioia methodology, the study builds an inductive understanding of how sustainability is interpreted, prioritized, and acted upon in real investment contexts. The goal is not to test theory, but to surface how evaluation decisions are made when traditional metrics are incomplete or unavailable.
The findings reveal a distinctive investment logic shaped by four interdependent dimensions: founder evaluation, sustainability orientation, decision infrastructure, and risk navigation. Founders are assessed less for polish than for conviction, adaptability, and alignment with long-term impact goals. Sustainability, meanwhile, is not treated as a fixed threshold but as a directional filter; embedded in business models, expressed through values, or used to frame market relevance. Decision infrastructure, from SDG mapping to internal learning systems, supports translation of principles into practice. Risk is not avoided but reinterpreted, with investors building conviction through narrative clarity, trust, and staged engagement.
By identifying these mechanisms, the study contributes to research on sustainable finance, hybrid logics, and early-stage investment. It challenges the idea that sustainability must be measurable at entry and instead frames it as a construct that is iteratively legitimized through founder dynamics, strategic alignment, and institutional learning. Practically, the thesis offers insight into how sVCs allocate capital amid ambiguity, and how investment logic evolves to support ventures that aim not only to scale, but to contribute meaningfully to systemic change. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9203960
- author
- Tessitore Bomente, Enzo LU and De Waal, Arend Casper LU
- supervisor
-
- Ziad El-Awad LU
- organization
- course
- ENTN19 20251
- year
- 2025
- type
- H1 - Master's Degree (One Year)
- subject
- keywords
- sustainable venture capital, sustainable startups, green finance, ESG evaluation, early-stage investing
- language
- English
- id
- 9203960
- date added to LUP
- 2025-06-24 10:00:40
- date last changed
- 2025-06-24 10:00:40
@misc{9203960,
abstract = {{This thesis explores how sustainability-oriented venture capital firms (sVCs) evaluate sustainability-oriented early-stage startups. While sustainability has gained prominence in financial discourse, its role in early-stage venture evaluation remains diffuse. Startups with strong sustainability missions often face investor hesitation; not due to lack of relevance, but due to limited standardization and the difficulty of assessing long-term impact under uncertainty.
Based on qualitative interviews with Swedish sVC professionals and analyzed using the Gioia methodology, the study builds an inductive understanding of how sustainability is interpreted, prioritized, and acted upon in real investment contexts. The goal is not to test theory, but to surface how evaluation decisions are made when traditional metrics are incomplete or unavailable.
The findings reveal a distinctive investment logic shaped by four interdependent dimensions: founder evaluation, sustainability orientation, decision infrastructure, and risk navigation. Founders are assessed less for polish than for conviction, adaptability, and alignment with long-term impact goals. Sustainability, meanwhile, is not treated as a fixed threshold but as a directional filter; embedded in business models, expressed through values, or used to frame market relevance. Decision infrastructure, from SDG mapping to internal learning systems, supports translation of principles into practice. Risk is not avoided but reinterpreted, with investors building conviction through narrative clarity, trust, and staged engagement.
By identifying these mechanisms, the study contributes to research on sustainable finance, hybrid logics, and early-stage investment. It challenges the idea that sustainability must be measurable at entry and instead frames it as a construct that is iteratively legitimized through founder dynamics, strategic alignment, and institutional learning. Practically, the thesis offers insight into how sVCs allocate capital amid ambiguity, and how investment logic evolves to support ventures that aim not only to scale, but to contribute meaningfully to systemic change.}},
author = {{Tessitore Bomente, Enzo and De Waal, Arend Casper}},
language = {{eng}},
note = {{Student Paper}},
title = {{Proof Can Wait: Inside the Logic of Sustainable Venture Capital}},
year = {{2025}},
}