How An Ethical AI Startup Makes A Triple-Bottom Line Impact

Growing a unicorn is about solving challenges as they arise.

Wendy Gonzalez has solved her fair share of challenges for Sama, the startup for which she is now CEO. Last year, when I interviewed her, she had just led the company through the loss of the startup’s founder, Leila Janah. “The company’s social mission pulled our team together,” said Gonzalez.

Sama provides high-quality, AI crowdsourced data as well as economic opportunities to women and youth in underserved and marginalized communities. It has impacted 52,000 people and validated its ethical AI supply chain through a randomized control study conducted by MIT. Sama aims to provide actionable career skills for underserved communities to create a more equitable future.

“Focusing on how we would grow Lelia’s legacy and make her proud of the work that she started, propelled the team forward,” said Gonzalez.

And grow they have. But not without jumping many hurdles.

In her time at Sama, Gonzalez transitioned the company from a nonprofit to a women-led triple-bottom-line for-profit B Corp, AI SaaS platform that raised a $14.8 million Series A round in April 2019. B Corps adhere to high standards of verified performance, accountability, and transparency on factors from employee benefits and charitable giving to supply chain practices and input materials.

For years, venture capitalists didn’t believe that you could do well and do good simultaneously. Gonzalez has shown investors a new ways for tech companies to do well and good at the same time.

Sama’s catering and agtech clients develop ways to reduce food waste. “Because it’s not used, 70% of food is just thrown out,” said Gonzalez. Clients use real-time data to determine how much food will be served, enabling them to cut down on the food the business prepares, saving it money.

While many companies worldwide had to figure out how to enable remote work, Sama had to figure out how to do this when most of its workforce was in Kenya and Uganda and lived in areas without internet access or reliable power. This was particularly challenging when, without notice, Uganda’s government shut down all transportation. Even if workers wanted to come to work, they could not get there.

“The people who are hit the hardest [by Covid-19] are the ones at the bottom of the pyramid,” said Gonzalez. “Every paycheck matters. We were very concerned about ensuring that we could protect our workforce and create business continuity for our clients.”

Sama has an impact-hiring approach. The company purposely hires in underserved communities, 50% women, 50% youth from communities that live on a household income of less than $2 a day, which is the world standard for poverty. “We pay full-time, living wages to move the underserved out of poverty,” said Gonzalez.

Doing so requires more than a living wage during the pandemic. SamaHome is a volunteer-only program that allows employees to move to a hotel, provides three meals a day, doctors onsite, and reliable infrastructures, such as power and internet. “We had 99.9% of the workforce volunteering,” said Gonzalez. She then went one by one to her clients and asked if they would support this mission-critical work that Sama was doing. “Pretty much every client said yes,” she reported.

In parallel, Sama worked with the government and internet service providers (ISPs) to get over 34 miles of fiber rolled out to the slums of Nairobi, Kenya. The company also provided laptops and battery packs. It wasn’t just Sama employees who benefited: their families did, too. “We not only stabilized the situation but grew,” said Gonzalez. In 2021, for the second year in a row, the company made the Inc. 5000. It also was acknowledged as an Inc. Best Business and B Lab Best for the World.

The AI market is fragmented. “Data is required at every step of the AI development lifecycle, and it needs to be transformed,” said Gonzalez in betaKit. “Right now, there are different solutions for every stage, and we aim to be that single platform [for all of them].” To develop the platform and expand internationally, Sama needed to raise more money.

“It was really important to find an investor who really gets us,” said Gonzalez. “Not only being really excited about AI but cares how we solve it with our unique social mission.”

A couple of years ago, the company made a strategic decision to invest in Montreal and make it Sama’s hub for research and development. Montreal has a world-class think tank, Mila, specializing in deep learning, AI, and machine learning. It also focuses on AI for humanity, supporting projects that leverage AI for social good.

“They’ve [Montreal AI ecosystem] got great universities, like McGill University and Université de Montréal, and also have a robust talent pool,” said Gonzalez. “The government has been pretty clever about creating incentives that drive businesses to come to Montreal and have a focus on AI for good.”

“We met our lead investor for our Series B Round through the Montreal ecosystem,” said Gonzalez. She was looking for investors who would provide good strategic guidance and advice and open doors.

Sama’s $70 million Series B round closed in November of 2021 was led by Québec-based CDPQ through its Equity 25-3 fund, with participation from Toronto-based First Ascent Ventures, Vancouver’s Vistara Growth, and Salesforce Ventures, as well as the company’s existing investors. The new financing brings Sama’s total funding to date to about $84.8 million.

“CDPQ has a strong track bringing Series B and C companies to IPO,” said Gonzalez. The private equity firm has a portfolio of SaaS companies. CDPQ’s Equity 25-3 fund targets explicitly companies that aim to increase the diversity of their teams. “The fund was founded in the wake of George Floyd and kind of the social justice movement,” said Gonzalez.

How will your company do well while doing good?