Ethical investment is big business. Investment funds increasingly want to put their money behind ventures that support ethical and sustainable values.
According to the Global Sustainable Investment Alliance, in Europe, total assets committed to sustainable and responsible investment strategies grew by 11% from 2016 to 2018 to reach €12.3 trillion. In the US growth was faster from a lower base, rising 38% from $8.7 trillion to $12 trillion over the same period.
But the large investment funds are not the only ones driving change. Kantar research, released earlier today, reveals that over three-quarters (77%) of UK grocery shoppers have, in the last 12 months, switched, avoided or boycotted certain products, or would consider doing so in the future, based on brands’ environmental policies.
Harsh working conditions, environmental pollution and the overuse of packaging are some of the issues consumers think carefully about before purchasing FMCG products.
“Global warming and deforestation and the loss of biodiversity are also big issues, both of which are factors food manufacturers have to be mindful of,” Kantar’s MD of brand Mark Chamberlain, told FoodNavigator.
While many of us are willing to vote with our wallets when it comes to backing ethical brands, this is not always an option in our individual financial planning and investment decisions.
Koodoo has an answer. The company is a fintech start-up that aims to democratise ethical investment and enable sustainable companies to leverage crowdfunding to raise cash.
The platform was founded by entrepreneur and philanthropist Brandon Kerzner in response to what it describes as ‘growing cross-generational groups of woke consumers’ who want to ‘live responsibly’ and care about environmental issues such as sustainable production and climate change. The platform connects sustainable businesses with people ‘who want to invest in the future of the planet’.
“The rise in conscious consumerism is going to be a game-changer in the world of investment," Michael Wilkinson, Koodoo CEO – and former operations director at Crowdcube - believes.
“Consumers, particularly younger generations, expect businesses to be driven in some other direction than simply making a profit. They increasingly back their beliefs with their shopping habits as well as investments.”
Investors around the world can invest in any of the small businesses live on Koodoo that are committed to social or environmental change, from as little as £20.
‘You don’t have to sacrifice returns’
Kantar’s research suggests that for FMCG brands investment in ethical and sustainable initiatives is becoming a business imperative.
“Kantar’s BrandZ study shows that brands with a purpose, defined as making consumers lives better, grow three times more over the long term,” Chamberlain explained.
This purpose should be embedded in the mission of the brand, he continued. “Brands would ideally communicate sustainability as part of a broader purpose that defines the brand so that the whole is more than the sum of the parts.”
If having a strong sustainable story is as much about business growth as ‘doing good’ for FMCGs, likewise, Wilkinson suggested, investing in ethical businesses must also make financial sense.
“Investing in businesses… that help the world does not mean you have to sacrifice returns,” he suggested. “We will channel investment in the businesses on our platform, using the most progressive technology available, to those entrepreneurs and changemakers who have the talent and vision to change our world for the better.”
Cellular Agriculture: ‘Koodoo’s investors are global changemakers’
One of the first companies raising funds on Koodoo is UK lab meat start-up Cellular Agriculture.
The company’s founders believe that lab meat will be an essential part of the future food chain if we are to meet the growing protein needs of the global population sustainably.
“With the world population projected to hit 9bn by 2050, there’s an urgent need to consider the way we produce food without further exceeding planetary boundaries to the point of catastrophe,” CEO and co-founder Illtud Llyr Dunsford stressed.
"While the ambitious Net Zero targets set by the UK government have started a timer on this issue, rapid technology advancements mean that finding new ways to reinvent protein is ripe for innovation, offering unique investment opportunities for the future of cultured meat."
Cellular Agriculture has built a proof-of-concept technology dedicated to scaling grown meat production.
By growing a protein cell in a nutrient-rich soup, Cellular Agriculture can work without the need for the live animal’s body. These cells can then be used to make meat products in much the same way as current methods. Unlike plant-based foods that seek to mimic the taste and consistency of meat, Cellular Agriculture’s cells are scientifically classed as meat and cook in the very same way, providing the same aroma and flavour.
The company aims to raise £500,000 to build and prove bench-scale technology and deliver the first pilot by the end of 2021.
Rapidly scaling cultured meat and making it available to the masses is core to Cellular Agriculture’s mission. The company wants everyone to have at least tasted, and eventually incorporated, grown meat into their daily lives.
“At present, records suggest that more people have been on the moon than have tasted grown meat in the UK. As the first company in the UK to solely focus on technology to scale and expedite the growth of the grown meat industry,we are excited to be raising finance on Koodoo," Dunsford noted.
Dr Marianne Ellis, CTO and co-founder, said the funds raised on Koodoo will be used to deliver scale that can cut the cost of producing lab meat so that the sector is able to compete on price with traditional meat.
“Koodoo’s investors are global changemakers who will power Cellular Agriculture to provide scale, coupled with technological efficiency to deliver grown meat products at a price parity to traditional meat so that the choice to eat more sustainably is available to all whether they are buying in local supermarkets or their favourite restaurants.
“We also have exciting plans to deliver the first public demonstration of Cellular Agriculture’s grown meat in a culinary setting, with rewards for early investors on Koodoo,” she added.
Other companies live on Koodoo:
- a-y-t is a sustainable fashion brand founded by Georgie MacIntyre, the former artistic director at Matthew Williamson. It offers an 'entirely sustainable and welfare-conscious' womenswear line, backed with a supply chain to match. Model and environmental activist Arizona Muse will front the brand’s debut collection.
- SO JUST SHOP is an award-winning accessories, homeware and gifting marketplace that works directly with women-led artisans from some of the most vulnerable communities in the world. Founded in 2015, the company works directly with artisans on design and product development, supply chain transparency and mobile payments, ensuring all of the products are ethically, and where possible, sustainably made. The brand’s mission is to raise 250,000 women and their families out of poverty by developing design and technological solutions that help them to overcome barriers to international trade. Founder Jennifer Georgeson wants to raise £130,000 to open its first multipurpose space in London and aid the growth of the business.
- Other Year is a recyclable sneaker maker that operates a circular economy footwear brand. Anti-landfill and pro planet, Other Year claims to be the only sneakers brand with 'the end of life designed at the beginning of life'. Shoes, the company says, are made from the 'highest quality, lowest impact materials'. The shoe is designed to be recyclable so when consumers have worn their pair for a chosen amount of time, they can be returned to the brand, disassembled and the separate parts recycled into new materials for new sneakers.