Micro-disruptors have the potential for impact, but they need more support to grow

Some of the most promising solutions to climate change, social inequality, and global health challenges may already exist. Still, these solutions struggle to get the funding they need to scale. One key reason is that capital often flows toward sectors perceived as more “cutting-edge”, such as artificial intelligence (AI) and deep tech.

Crunchbase estimates that nearly a third of all global venture funding went to AI-related companies in 2024, making it the most funded sector today. Meanwhile, other sectors fly under the radar and struggle to attract capital.

Climate, social, and health innovations often take much longer to show measurable impact. For example, education technology platforms, or “edtech”, can take years for social impact to materialise, and these social returns are dependent on many external factors such as job placement, improved economic mobility, and global trends. 

Furthermore, scaling across demographics and regulatory environments adds complexity. As most traditional funders seek returns within three to five years, it is difficult for these long-term solutions to compete for funding.

Capital and attention are focused mainly on fast-moving industries. Early-stage startups, and social enterprises — the “micro-disruptors” — risk being overlooked despite their potential to drive lasting systemic change. Yet, companies are proving that patient investment in sustainable innovation can lead to meaningful disruption.

Indonesian startup MYCL is a strong example of innovation with impact. Traditional leather production contributes 8 to 10 per cent of global fashion industry emissions. Still, MYCL offers a sustainable, low-carbon alternative by transforming palm oil waste into MYLEA, a leather substitute used in the fashion, furniture, and automotive industries.  

I had the privilege of meeting MYCL’s co-founder and chief executive officer, Adi, last year and was impressed by the creativity, vision, and measurable impact the company has achieved. Their products are starting to disrupt the fashion industry, having been featured in Melbourne Fashion Week 2023 and recently trialled by Adidas to recreate the iconic Stan Smith sneaker using mycelium leather.

It is encouraging to see MYCL gain early funding, mentorship, and recognition as an Earthshot Prize 2024 finalist and mentee of the Amplifier programme by Temasek Trust ecosystem entities, the Centre for Impact Investing and Practices (CIIP) and Philanthropy Asia Alliance (PAA).

But this is just the beginning of MYCL’s impact and growth journey. With the right level of resources and support, MYCL — and other mission-driven businesses like them — could scale even further, accelerating their impact and positively disrupting their industries.

There are encouraging signs of change. The Global Impact Investing Network (GIIN) expects funders to show more interest in climate and social equity solutions, with increased funding for impact-driven ventures, growing from US$502 billion ($673.5 billion)at the end of 2018 to an estimated US$1.57 trillion at the end of 2024.

One key shift is the increasing use of catalytic capital — funding that takes on more early-stage risk and provides patient investment for high-impact projects. This type of financing is expanding into more geographies, particularly in emerging markets across Asia, South America, and Africa, where the need for scalable solutions is high.

This momentum presents a significant opportunity for impact-driven startups to secure the support they need to grow. However, to fully realise this potential, the proper infrastructure and knowledge must be in place — whether through better funding mechanisms, a stronger articulation of “measurable impact”, or networks that connect early-stage ventures with the right funders. Ensuring these solutions capture the right opportunities as capital flows shift is essential.

One-stop shop for impact

This inspired the incubation of Co-Axis, a one-stop digital impact marketplace that aims to give high-potential micro-disruptors the visibility they need to attract capital. Launched by Temasek Trust and strategic partners DBS Foundation and UBS Optimus Foundation, Co-Axis brings together an ecosystem of partners and funders with the relevant expertise to provide mentorship and funding to these promising ventures.

To date, we have welcomed nearly 100 micro-disruptors onto the platform across over 40 countries globally. Their impact areas are wide-ranging — from education and healthcare to ocean conservation and sustainable agriculture. Funders can explore and support these solutions through various financing methods, from grants to blended financing.

A core requirement for micro-disruptors who wish to join the Co-Axis platform is their commitment to measuring and reporting their impact. Funders today demand measurable results, accountability, and a lasting impact on the world more than ever.

With the support of fellow Temasek Trust ecosystem entities like Temasek Foundation, CIIP and PAA, we look to set a high bar for impact measurement and reporting. By conducting rigorous content screening, due diligence, and assessment of each “micro-disruptor”, we ensure that the platform only lists high-quality projects.

Recognising that impact measurement can be a challenge for early-stage ventures; we also work closely with our partners to guide these ventures in strengthening their frameworks and reporting capabilities.

Building a global impact marketplace

Crowdfunding platforms such as Kickstarter offer one-stop support to the underlying project. Through them, micro-disruptors can tap a whole gamut of resources such as networking opportunities, training, workshops, infrastructure, and more.

Co-Axis seeks to do the same for the impact space. By bringing together various industry leaders, we equip micro-disruptors with the insights to sharpen their approach, mentorship to guide their journey, connections to open doors to new funders, and flexible funding to extend their runway for growth. This holistic support improves their chances of building lasting, scalable solutions.

Beyond the digital platform, we also build an offline community where honest conversations, connections, and collaborations happen. At our first community event with Arta Finance, a digital wealth platform, it was encouraging to see end-funders genuinely curious about impact investing.

They wanted to understand the concept and how they could actively support micro-disruptors. This reinforced what we have long believed: That there is a real appetite for further education on how to support impact-driven projects.

Through Co-Axis, we aim to make these connections seamless and help micro-disruptors be viewed as real impact investment opportunities. We also hope to help funders — whether individuals or corporations — feel informed, confident, and able to understand the risk profiles of these impact ventures while being excited to back those that can create lasting impact.

There is a significant opportunity and need for an impact economy. The value of business opportunities in key sectors — including food, cities, energy, and health — could collectively exceed US$12 trillion annually by 2030, while the support across all sectors of the United Nations’ Sustainable Development Goals has grown to more than US$4 trillion per year.

As global venture funding tightens, we need to reconsider our support for the ideas that could shape a more sustainable and equitable future — even if they are micro-disruptors that require a longer runway.