As an efficient founder, you've probably heard a lot of mainstream advice that gives you pause. If something doesn’t feel right for your business, trust your gut—your intuition is your best guide. Here are five common pieces of advice that should raise red flags when given:
RED FLAG #1: "Raise as Much as You Can" More money isn’t always the answer. Raising big funds brings big expectations—and often, strings attached. Stick to your lean approach and raise only what you need. Less capital can mean more freedom.
RED FLAG #2: "Hire Fast, Scale Fast" Bigger teams don’t automatically equal success. Every hire should make a measurable impact. Scaling smart is far more sustainable than scaling fast. Focus on building a team that truly moves the needle for your business.
RED FLAG #3: "Spend Big on Marketing or a Sales Force" Splashy and expensive marketing campaigns are not your game. You know how to creatively and cost-efficiently grow your brand, focusing on real customer loyalty rather than vanity metrics. Don’t get swayed into spending big on things that won’t drive meaningful results.
RED FLAG #4: "Focus on Hypergrowth Over Profitability" Profitability is key. It’s easy to chase rapid growth, but the true measure of a successful business is its ability to sustain itself in the long run. Focus on building a strong foundation that supports both growth and profitability.
RED FLAG #5: "Big Advisors and Huge Networks are a Must" Name-dropping won’t solve real problems. Scrappy founders know that having the right people in their corner is far more valuable than collecting well-known advisors. It’s about quality, not quantity.
RED FLAG BONUS: "You Need VC to Win" VCs want you to believe this, but if you’re profitable and growing, you’re already winning—on your terms. Many successful businesses have thrived without venture capital, and if your business model works, you’re already ahead.
Trust your instincts and stay true to what works for you. Not all advice is created equal, and for scrappy founders, efficiency and thoughtful decision-making are often the biggest strengths.
Allison and Maria
Is Entrepreneurship Now Only for the Elite?
As a daughter of entrepreneurs who has spent the last 20 years investing in startups, I have watched with a mix of fascination and dismay as the definition of an entrepreneur has evolved. Today, it seems that being an entrepreneur is like getting a membership into an elite club, where visionary innovators are flush with venture capital dollars, trying to disrupt industries and bring their products to the masses in the shortest amount of time.
The Misfits of Yesteryear
When I think of an entrepreneur, I think of my parents. They were misfits. As immigrants, they didn't fit into the conventional corporate American world. For most of their young adult lives, they were often overlooked or looked down upon, struggling against a system that neither understood nor valued their contributions or capabilities. It was their very status as outsiders that fueled their determination and ingenuity.
Contrary to the romanticized image of the visionary dreamer, my parents were pragmatists at heart with an optimistic outlook on life because their survival depended on it. A simple, burning need to survive and thrive despite the odds drove them. They focused on solving real problems with practical solutions, always mindful of the bottom line and the harsh realities of the market. I learned what entrepreneurship was from witnessing them in action.
The Rise of the Elite Entrepreneur
Fast forward to today, where I see a different breed of entrepreneur. Many startups come out of stealth (if they’re lucky), or prestigious incubators and accelerators, armed with glossy pitch decks and well-rehearsed narratives that appeal to a select group of venture capitalists. These entrepreneurs are often well-connected, well-educated, and well-funded from the outset. While there's nothing inherently wrong with this, it has shifted the perception and accessibility of entrepreneurship.
The Consequences
Our society is increasingly divided into the haves and have-nots. Historically, entrepreneurship offered a pathway to bridge this divide, providing opportunities for those who didn't fit the traditional mold of success to create their own fortunes. However, I see too many founders today allowing their inability to raise capital to hold them back from succeeding. This is a false belief. True entrepreneurs don't let the lack of external funding define their potential or their success. They find ways to make things work with whatever resources they have, proving their mettle through resilience and ingenuity.
A Call to Return to Our Roots
It’s time to return to the roots of entrepreneurship. We need to support and celebrate the misfits and pragmatists who challenge the status quo and find creative solutions to everyday problems. This means:
Lowering Barriers: Creating more accessible pathways for funding and support, particularly for those outside elite circles.
Valuing Pragmatism: Recognizing the importance of practical, incremental innovations alongside visionary ideas.
Fostering Resilience: Encouraging a culture that values grit and determination as much as, if not more than, polish and connections.
Entrepreneurship should not be an exclusive club for the privileged few. It should remain a beacon of hope for those who don’t fit into the traditional molds, who are driven by necessity and the desire to make a difference. By embracing the pragmatists and the misfits, we can foster a more inclusive, resilient, and innovative entrepreneurial ecosystem.
At Crescent Ridge, we celebrate and want to fund the scrappy, determined individuals who, against all odds, build businesses that solve real problems and create lasting value. They are the true heart of entrepreneurship, and it's time we remember that.
What do you think?
Allison
The end of Venture Capitalists?
How AI-Driven Efficiency is Transforming the Industry As We Know It
In February, Sam Altman discussed the possibility of a $1B one-person company. My friend Elaine Pofelt has been talking about this concept for years in her books, "$1M One-Person Business" and "Tiny Business Big Money." With AI making business building cheaper and technological efficiencies making everyday items more affordable despite inflation, I'm wondering: what will happen to the venture capital industry?
This situation reminds me of 2010 when I moved to LA from NYC after spending six years working at a VC firm and for one of our portfolio companies focused on medical devices. Medical devices were incredibly capital-intensive, and I believe there's still a need for big dollars in life sciences and deep tech startups with substantial R&D components. As I was learning about technology investing, the LA startup ecosystem was beginning to take off. I was fascinated that for $50,000, you could build a prototype and test it on customers. At the same time, I was confused by startups raising millions of dollars in their early days when it didn't seem necessary, nor were they ready for it. Yet, founders were determined that raising enough money would ensure their businesses' success. However, I saw time and time again that they were building something that didn't fit a specific market problem, making it expensive because they had to add many bells and whistles to please various customers.
In technology companies, those lucky enough to get into the VC club can fund grand visions, but at a cost. For everyone else, there's a real shot at entrepreneurship. But entrepreneurship is not about raising money; it's about survival. Survival against all odds – despite not being able to raise money, despite customers not understanding your business, and having no choice but to risk it all. For these companies, power is in the hands of the founder, but will they give that power away to the VCs?
If entrepreneurs return to their roots, the VC industry will have to change. If not, the VCs hold the power.
Is Technology Costing Us Our Humanity?
At Crescent Ridge, we love being investors because we gain so much inspiration from entrepreneurs’ creativity, innovation, and passion. Our goal is for businesses to create solutions to life’s deep challenges. We share a passion for helping founders solve problems, and we want to support them with our capital, network, and expertise. Technology plays an important role in this, especially because it’s made it accessible for almost anyone to be an entrepreneur today. Over the last couple of years, we've seen technology advance faster than ever. This has sparked a lot of reflections that have impacted our thought process when making investments and I wanted to share them with you today.
Technology is a tool, and as we know, tools can be used to help humanity but also for selfish gain. Tools of the past were geared around efficiency. For instance, hammers are more efficient than a rock. Cars are more efficient than walking. These tools have also enabled us to be “superhuman.” I cannot pound a nail with my hand without damaging it, but a hammer gives me the power to do a task I could not otherwise complete. However, for tools of the past, human control and direction were the only way a tool could be used.
Today's technology has shifted, and now it mimics being human. It is designed to learn and evolve as it continues to be used. ChatGPT, DALL-E, and other forms of AI continually shift to create outputs that mimic those created by humans. As I grapple with what this means for society, I find myself torn between all the efficiency I gain from technology and the many ways it distances me from my own humanity.
Being human is often uncomfortable and challenging. But this also teaches us about joy and purpose. It is in the midst of hardships that we are inspired to be even more human—passion, creativity, and innovation are often born out of deep hurt and heartache. I worry that the temptation to avoid pain, hurt, and sadness hurls us into a world where we fear those things, and so we fill our time with quick fixes that we think will temporarily distract us from the inevitable.
In the last week, I have received news that two people I deeply respect have been diagnosed with ALS. One of them was a pastor at my church. Despite an aggressive form of ALS that has robbed him of his ability to speak, he bravely decided to preach today. At the end of the service, our church prayed for his wife and children as they stood in front of the congregation. His family held hands and wept together. Our whole church cried as we witnessed his incredible courage amidst deep sadness and grief.
Being human is about suffering. We can’t AI away pain. And when we look for the things of the world to mask the deeper hurts in our lives, things only build up and create even more and longer-lasting sadness.
We are at a point in our society where we talk openly about mental health, addiction, identity, and purpose. But I believe productivity, power, money, and fame are versions of addictions that are deemed “healthy.” Like any addiction, it can start out innocent but then control you. I worry that people in charge of funding, creating, and developing technology are addicted to the things that keep them in power, and we are enabling them by allowing them to stay in power.
I am concerned about the future of technology, so at Crescent Ridge, we choose to invest in companies that bring us closer to being human. As we use technologies in our personal and professional lives, our aim is always to apply them in a way that amplifies who we are. We are here to embrace our “human-ness,” our connection, and the wealth of experiences this brings to our lives. Reach out to us and share the ways you are managing the balance between modern efficiencies and human connection. We look forward to connecting with you!
Allison
Small is the New Big: Start-Ups, Micro-Funds, and Beyond
Three weeks ago, we caught up with a good friend who is a former successful entrepreneur. He sold his company a couple of years ago and is now advising several startups. He was amazed by one particular company he’s coaching: a consumer business with $25M in revenue, 70% gross margins, and $6M EBITDA. They have a tiny team—just three full-time employees and a couple of part-timers. They raised a small amount from friends and family and are very content with their business. Our friend reflected on his own experience with the larger company he built and sold, where he had raised significant capital. What really struck us were his words: "If I were to do it all over again, I wouldn't want to raise big VC. I would keep the team very small and do things differently."
We hear stories like this more often lately and are seeing a trend: More people are deliberately choosing to stay small and build companies differently. We have noticed that the happiest businesspeople we meet these days are entrepreneurs running smaller, profitable businesses deeply involved in their communities. Many have experienced success in bigger corporations and understand that the bigger you get, the harder it is to maintain your culture and keep a growing team happy. While there are certainly advantages to being big, and amazing companies like Patagonia that manage to keep their soul after they grow, we're noticing a trend of successful people who could go big choosing instead to stay small.
We see similar advantages in running a small fund. Despite opportunities to grow our AUM and raise more money, we have deliberately chosen to stay small. The reasons? We can truly stay true to our core values, we like the discipline of capital constraints, we don’t want to have a big team, we can find good deals that most VCs don’t find interesting because they are too "niche", and ultimately, we can make decisions that are not just purely financial, which is what sometimes happens when you have too much capital and too many LPs.
It also took us a few mistakes to understand that as a smaller fund, we need to invest with a different approach than traditional VCs to make our numbers work. This approach is more focused on hyper capital efficiency and survival skills in the early stages. We still benefit tremendously from venture “home runs” in our portfolio, but our portfolio composition and risk profile need to be a bit closer to private equity than most VCs. We believe that this approach not only benefits small businesses but also provides a stronger foundation for companies going the traditional venture route. It’s all about minimizing waste in the early stages when most companies pivot anyways and take a lot of time to nail their product-market fit and business model. We believe that capital constraints at that stage will only make your company stronger once you get to the growth stage.
We have many examples of this in our portfolio. For instance, Uqora, one of our early investments focused on women’s health, raised less than $2M, had a team of 2.5, and went from launch to exit to strategic in four years. In retrospect, they benefited a lot from staying very lean and not having the opportunity to raise as much as they initially intended because that increased their optionality. Had they raised more capital, they would have to grow a lot more to get a good outcome. This capital constraint kept them very focused; they nailed PMF and their business model quickly. They had a lot of options by the time they reached 8-digits in revenue. They ultimately decided to sell their company to a strategic buyer, and it was a very successful exit for founders and investors alike. But they could have kept growing the company and raised growth capital with great terms and a very good business foundation.
Whether in the realm of micro-funds or startups, the trend toward smaller scales is driving significant innovation and success. We believe that small is the new big. There is a lot of energy in a generation of entrepreneurs who are pragmatic, innovative, and want to use their business as a way to serve others and make the world a better place. These entrepreneurs are not so interested in getting in the next YC batch or getting Sequoia’s funding. They understand that “small is the new big” and are ready to do it differently this time.
Do you know any entrepreneurs ready to do things differently? Do you know other fund managers who see their small fund size as their greatest strength? Send them our way! We need to grow this new entrepreneurial ecosystem where we, small funds and non-traditional entrepreneurs, can thrive.
Maria and Allison
3x The Impact of Your Sustainability Budget
Achieve Carbon Neutrality, 1% for the Planet, and Improve Ocean Biodiversity with SeaTrees
Are you a founder interested in 1% for the Planet and Climate Neutral certification? We have a great tip for you that a lot of entrepreneurs love. You can achieve both your 1% for the Planet commitment and carbon neutrality by partnering with SeaTrees. This approach not only maximizes your sustainability efforts but also supports an incredible mission that makes a real difference. As someone who volunteers with SeaTrees, I've witnessed their incredible team, at the forefront of climate change innovation, in action, and can attest to their impactful projects (they currently have 23 projects around the world).
Why SeaTrees?
SeaTrees offers a unique opportunity to achieve carbon neutrality while fulfilling your 1% for the Planet commitment. Their mission is to restore coastal ecosystems and combat climate change by planting mangroves, kelp, and other critical habitats. These projects not only sequester carbon very effectively but also support marine biodiversity and local communities.
The SeaTrees Mission
SeaTrees focuses on restoring blue carbon ecosystems, which are some of the most efficient natural carbon sinks on the planet. Their projects include:
Mangrove Planting: Mangroves sequester up to 10 times more carbon per hectare than terrestrial forests. They also protect coastlines from erosion and support diverse marine life.
Kelp Reforestation: Kelp forests absorb CO2 and provide habitats for marine species, improving ocean health and biodiversity.
Community Support: By working with local communities, SeaTrees ensures sustainable project development and long-term environmental stewardship.
How to Leverage SeaTrees for Maximum Impact
Understand Your Emissions: Conduct a comprehensive greenhouse gas (GHG) inventory of your operations. This includes emissions from direct activities (Scope 1), indirect emissions from purchased energy (Scope 2), and other indirect emissions such as supply chain activities (Scope 3).
Strategic Allocation: Allocate your 1% for the Planet funds through SeaTrees to directly offset your carbon emissions. Their verified carbon credits ensure that your contribution is making a measurable impact.
Achieve Carbon Neutral Certification: By partnering with SeaTrees, you can work towards earning a carbon neutral certification. This certification demonstrates that your company has measured and offset its carbon emissions to net zero, enhancing your credibility, impact and marketability.
Engage Your Stakeholders: SeaTrees provides incredible storytelling and marketing collateral to engage your customers and stakeholders. This not only strengthens your brand but also amplifies your impact by showcasing your commitment to sustainability. Unlike other organizations, SeaTrees offers extensive branding assets for your marketing efforts.
Involve Your Team and Customers: Make sustainability a core part of your company culture. Engage your team in your environmental initiatives and encourage them to contribute ideas. Communicate your efforts to your customers, enhancing customer loyalty and attracting environmentally conscious consumers.
Partnering with SeaTrees offers a strategic and impactful way to leverage your 1% for the Planet commitment to achieve carbon neutrality. By supporting their mission to restore coastal ecosystems and combat climate change, you can significantly reduce your environmental impact and enhance your brand's reputation. This means you get three times the impact for your sustainability budget: supporting the 1% for the Planet program, achieving carbon neutrality, and supporting biodiversity. All this, while also getting the benefits of partnering with Seatrees: marketing collateral, opportunities to visit the sites, content, and working with their incredible team.
If you wan to learn more information on how SeaTrees can help your business achieve its sustainability goals, check out their website here and their partnership with Climate Action here.
Image from SeaTrees by Sustainable Surf
Informed Audiences, Elevated Expectations
How Information Availability Pushes Companies to Step Up
Modern digital technologies have fundamentally transformed the way consumers interact with businesses. At Crescent Ridge, we have seen firsthand how the abundance and accessibility of information raises the bar for companies aiming to build a loyal and reliable customer base. It is no longer enough to have a compelling marketing message; companies must build credibility and cultivate brand values that resonate deeply with their audience. We're excited to share our perspective and a few examples we see in our portfolio.
Transparency Is Non-Negotiable
Everyone can become educated on a given topic due to the abundance of information available on the internet. When we combine the accessibility of research from verified experts with the power of social media and AI, it is clear that we live in an era of an abundance of information. As a result, transparency is proving to be a pillar of business success. Those who are interested can quickly verify for any business the internal treatment of employees, ethics of business practices, and environmental impacts of operations.
One of our portfolio companies, Esas Beauty, is a prime example of embracing transparency. They manufacture fragrances and focus on sourcing the cleanest, synthetic-free ingredients; thus ensuring their products are safe and environmentally friendly. Their commitment to transparency has garnered a loyal customer base who prioritizes their health, and we’re proud to support their journey.
Esas Co-Founders, Amanda and Seda, use their extensive experience in fragrances and chemistry to develop synthetic-free products.
Quality and Value Take Center Stage
With easy access to detailed product reviews, consumers are equipped to make informed choices. This shift forces companies to deliver high-quality products and services that offer real value. Brand recognition and marketing strategies alone are no longer sufficient; businesses must prove their worth through tangible offerings.
We’ve witnessed our portfolio company, Needed, exemplify this commitment to quality. Their rigorous supply chain standards, coupled with plastic-neutral, carbon-neutral practices, B-Corp certification, and their participation in 1% for the Planet, demonstrate a dedication to excellence and commitment to their customers and the planet. Last year, they also launched Needed Labs, a major effort and investment to ensure they are at the forefront of women’s health research and innovation so they can offer the highest quality in their products. This launch has also reinforced the brand’s value proposition. It's inspiring to see how they set the bar high for quality, innovation, sustainability, and thought leadership in their industry.
Julie Sawaya & Ryan Woodbury, co-founders of Needed, created a complete Nutritional System™ for fertility, pregnancy, postpartum, and women's health.
Ethical Practices and Authentic Engagement
Modern consumers are quick to detect a lack of authenticity and expect genuine engagement from the brands they support. Customer experiences are frequently shared online, emphasizing the importance of exceptional service and engagement as key differentiators. Companies must look beyond the bottom line to build meaningful relationships with their audience.
To the Market provides software that helps companies maintain good manufacturing practices, further showcasing the importance of ethical business operations. By leveraging technology to ensure compliance and quality, they help businesses align with consumer expectations. Their platform is a testament to how technology can drive ethical business practices.
To sum it up, we believe that as hard and competitive as things are getting, this era of hyper-educated consumers can present a huge opportunity for brands that truly care and want to wholeheartedly do things right. When businesses embrace educated audiences as a source of strength, they set themselves up to corner their markets as their consumers become their advocates.
We want to hear from you! What are ways companies have stepped up to earn your loyalty? Share some brands you love with us!
To the Market's vision is to democratize access to the global supply chain and provide makers worldwide with economic empowerment.
Profitability vs. Growth. The VC Conundrum
One of the most challenging decisions this year for startups and investors alike is choosing between profitability and growth. Cash flows are tight, interest rates are high, funding is at an all-time low, and on top of that, you have a crazy geopolitical environment with a lot of uncertainty, making it harder than ever for entrepreneurs to grow their businesses. Founders are hearing conflicting advice from their investors: "Watch for profitability, but... also keep growing at a venture pace!" This type of advice seems schizophrenic.
The stakes are high. If you are very responsible with your cash and very conservative, the impact on multiples will be very apparent when you try to sell your company or raise the next round. You also risk falling into the dreaded Zombie Zone, where you are no longer considered a high-potential opportunity and end up with limited options either to restart, pivot, hibernate, or become a "lifestyle business."
Our approach: Slow-down before running fast
At Crescent Ridge, we have a contrarian approach to most VCs and are strong believers in slowing down in the very early stage to avoid this conundrum. Instead of the classic advice: "Raise a lot more in your pre-seed/seed because you'll make mistakes and will need more money than you think," we encourage startups to slowdown in the early stages, and raise less to minimize waste. The early stage is the best time to slowdown to test your product, validate your market fit, and refine your business model. You really need far less than you think, and you can even do most of the customer validation work while having another job or by raising a minimal amount. The constraints of capital in this early stage will only make your product stronger.
Once you have solid proof of concept and significant market traction, proceed with fundraising. At this stage, you can confidently scale, knowing your product and market fit are secure. And you won't be wasting money on the wrong product, customer, or approach.
But... what if my company is already in growth mode?
For startups already in the midst of rapid growth, balancing burn rate with sustainable development is crucial. Here are some strategies:
Prioritize and focus on core activities: Identify the initiatives that drive the most value and cut back on the "shiny objects". This helps manage resources more effectively and avoid burnout.
Streamline operations: Streamline operations to reduce costs without compromising quality or customer experience. Use agencies or contractors when possible to keep overhead low. We see more and more seven-digit revenue businesses with very lean 2-5 people teams. Small is the new big.
Strategic partnerships: Form partnerships that can provide additional resources or capabilities at a lower cost. We have many such partnerships in our portfolio, and cross-selling can significantly impact organic growth and lower CAC.
Maximize existing relationships: Focus on upselling and cross-selling to your current customer base. Expanding within an existing customer segment is often more cost-effective than acquiring new customers.
Drive your decisions with data: Use customer data to drive decisions on where to allocate resources for maximum impact. It's always good to have a methodical team member aka "the dream killer" who can keep everyone focused and who helps prioritize the best initiatives for the company.
The profitability versus growth conundrum remains one of the toughest challenges for our portfolio companies, especially in 2024's tight financial landscape. By taking a measured and strategic approach, startups can navigate this complex terrain. Patience in the early stages, combined with strategic scaling and resource management, can help companies achieve both profitability and sustainable growth. Balancing these priorities is not easy, but with careful planning and execution, startups can thrive even in this challenging environment.
Entrepreneurs Are Leveling Up…
...And They Are Changing Business Perspectives
As investors deeply connected to the start-up community, we talk with hundreds of entrepreneurs a month from all over the US. A recent trend we are seeing epitomizes an energy that has not been present since the mid-2000s. This new wave of entrepreneurs pair pragmatism with idealism, and they truly understand the value of autonomy, independence, and service. These entrepreneurs do not define success by maximizing profits at the expense of employees, customers, or values. Rather, their definition of success is serving their customers the best they can. There are 3 hallmarks of the leveled-up entrepreneur:
Seaesta Surf kids show off creative swimsuits in the sun
Unwavering commitment to their values: Julia Wheeler, CEO of Seaesta Surf has created a playful and sophisticated children’s swimwear brand. Adamant about sustainability, she’s intentional regarding the materials she uses. For example, Seaesta Surf's swimsuits are 78% recycled, made from fishing nets. Julia is aware of the impact a clothing brand has on the environment, and is committed to creating ecologically-friendly systems. Through Seaesta, a diverse community has been formed of parents, makers, and creatives who embody the California surf culture (like the Stopnik family and Denisse Wolf). She is also focused on give-back initiatives like this partnership with the Michael Phelps Foundation. As she scales her business with a foundational commitment to these (and other) values, an example is set for others on how to create multi-faceted sustainability.
Creating wealth for all stakeholders. Joey Odom and Heath Wilson, Co-Founders of Aro, exemplify how a business can generate diverse forms of wealth for both stakeholders and customers. By developing an app specifically designed to foster healthier screen habits, they firmly establish the value of relational wealth, enabling users to build stronger interpersonal connections and more meaningful relationships. Simultaneously, Aro promotes intellectual wealth by encouraging people to unplug and engage in activities that stimulate mental growth and creativity. Moreover, they achieve this while creating a financially sustainable business model, ensuring long-term profitability and economic value. Through their innovative approach, Odom and Wilson demonstrate that a business can simultaneously enhance social, intellectual, and financial well-being, ultimately contributing to a more balanced and enriched life for all involved.
Deep fulfillment through serving others. Amy Van Haren at Pumpspotting sees business as more than just a way to make a living. It’s a creative extension of herself. Since the very beginning, she has been on a mission to help mothers in the early stages of motherhood navigate feeding an infant. She’s gone so far as to retrofit a bus and go on a US tour (twice!) to connect with baby-feeding moms in person so she can understand their problems and tweak her product to meet their needs. By prioritizing connection with her customers, she is able to understand and meet their needs in a unique and deeply fulfilling way.
As we support sustainability for our Founders and their companies, we also desire to highlight the ways they create demonstrable impacts in their spheres of influence. We hope to facilitate efforts to use business as a vehicle of improvement for our communities, industries, and world. Reach out to us and share ways you have seen these (and other) practices at work!
Pumpspotting's US van tour route
4D Wealth Case Studies
4D Wealth Framework: Real-World Case Studies of Our Secret Sauce in Business
I grew up in an era when business success was synonymous with financial gain. The 80s and 90s marked the rise of huge corporations – Microsoft, Coca Cola, Walmart, Bank of America to name a few. These companies provided all of us with access to technology, financial services, and everyday goods in an affordable and accessible way, with one goal in mind – financial success for those at the top. In the last 2 decades, as information has become more readily available and entrepreneurship has become accessible to the general public, profitability has been thrown to the wayside in favor of hypergrowth, with tech giants like Amazon, Meta, and Alphabet. Environmental, Social and Governance (ESG) and impact investing also became mainstream, but became overused and misused and came with the assumption of sacrificing returns to do good. One thing is consistent – these businesses and their investors are still prioritizing financial success for those at the top. However, at Ridge Group Investments, we’ve witnessed a new wave of visionary leaders who dare to redefine wealth, in a world where consumers are also demanding more from businesses. These pioneers care about financial success, but not only for themselves. We see these leaders crafting a future where business success is synonymous with human flourishing.
Inspired by such visionaries, we developed a framework called Four Dimensional Wealth (4D Wealth) – a framework we believe holds the key to a prosperous future. We are excited to present a series of case studies that highlight 4D Wealth, which provides a fresh perspective on profit, purpose, and impact.
What is Four Dimensional Wealth?
When we started Ridge Group Investments in 2017, we imagined a world where businesses are guided by a higher purpose. Where leaders would not be seduced by the allure of wealth, power, or recognition, but instead focus on solving real-world problems. As we began investing, we realized we didn’t need to imagine this world, because it already existed. What we saw was leaders who defined wealth in these four dimensions:
Financial Capital – A strong financial case serves as the foundation to any business. The profitability and longevity is paramount. Stability and the feeling of having “enough” provides the flexibility to create other dimensions of wealth.
Relational Capital – Honoring relationships and serving others first is key, starting with the team and customers and extending to partners and allies.
Societal Capital – The net output of the company should do more good than harm. There is a responsibility to contribute positively to society, addressing pressing issues without compromise.
Intellectual Capital – A different approach and perspective is required to succeed. These leaders embrace risks, challenge the status quo, and consistently seek creative solutions.
To bring this concept to life, we partnered with CorpCare and three individual companies to develop three case studies highlighting companies and leaders who are living out this framework.
Walla: An innovative software startup with a transformative vision to be the business partner fitness studio owners have always needed.
Blockit: A high growth software platform that provides patients superior access to healthcare more efficiently and transparently, benefitting both the provider and patient.
Trinity: A global storage and home organization company that has set the bar high for company culture and operational efficiency. Their actions speak louder than words and have built incredible trust with all stakeholders over the past decade.
These case studies are a testament to the power of Four-Dimensional Wealth. They showcase how leaders who consider all four dimensions in their decision-making foster stronger, more sustainable, and innovative companies that leave an indelible mark on society.
This is our investment thesis - a fresh take on business that rekindles trust and reimagines success.
We invite you on this transformative journey into a world where business transcends the one-dimensional pursuit of profit and emerges as a force for positive change. Together, we can redefine wealth and usher in a new era of prosperity for the masses, not just the lucky few.
Do you want to see 4D Wealth in action? Check out our case studies:
