As CEO of a Single Family Office specialized in scientific and technological Venture Capital, it is common to see how companies that had an initial business strategy change course and begin to operate in other sectors that come into conflict with your values and ethical principles. It is time to disinvest.
We find a multitude of references such as that of the Norwegian sovereign fund, which sold its investments in companies that manufactured nuclear weapons.
However, there is a very interesting issue that we have observed in our twenty years of experience and that is often overlooked: the conditional sale of a company. When investing in Venture Capital, the invested capital is often withdrawn when the founder leaves the company or when the company is sold to a third party. If we are responsible investors, we must know that the end of an investment does not simply mean collecting profits, but to see under what conditions that product or technology will be used in the future, especially in scientific sectors as sensitive as biotechnology, with many aspects that need a deep ethical analysis, or any technology that can be used for war purposes, such as nanotechnology.
We have wonderful examples of sellers who have conditioned their sale, such is the example of CRISPR Therapeutics that, when it sold its gene editing technology to Vertex Pharmaceuticals, included a legal clause in the contract prohibiting Vertex from using the aforementioned technology to modify genes related to intelligence or physical appearance.
Another well-known example is that of the pharmaceutical company Roche, which acquired the biotechnology company Sparks Therapeutics and the contract clearly limited the uses that Roche could make of gene editing technology, highlighting that it could never be used for the creation of biological weapons.
If we look at the technology sector, Apple bought the Artificial Intelligence company Xnor with a clause that prohibits Apple from using this technology for the creation of weapons.
These cases can serve as inspiration for other conditional sales, which allow not only to avoid the creation of nuclear weapons or à la carte genetics, but, for example, to take care of the use of mobile technologies among the youngest ones.
You know the Saxon saying: the devil is in the details. Make sure you are not only making investments with values, but always disinvesting or selling according to humanistic values, with people at the center, seeking the greater good and leaving the legacy of any family office. Let’s make the transformative force of private capital help build a better world for everyone.
