Environmentalism and social good are often associated with the “bleeding heart” motif; in a world that values consumption above all, being green can be against the grain. In general, consumers want their goods as quickly and easily as possible, and when they’re done with them, they want to be done, the end-of-life of products and packaging far from mind. Conscious consumers pay premiums in money and time in support of sustainability, taking up a mantle that is often the path of most resistance.
For green brands and NGOs, setting out to offer the solutions and services that help consumers minimize their impacts presents its own challenges. In a market that still prioritizes short-term returns, genuinely incorporating sustainability into business decisions can outwardly pose to investors and stakeholders a degree of risk. Striving to mitigate costs and reduce uncertainty, businesses, like consumers, are presented with prohibitive obstacles with regards to stewardship that often boil down to a matter of economics.
To bring to market solutions that raise awareness around sustainability and provide tools people can use, financing tends to be on the top of the list of hurdles for green companies looking to scale. A business does not survive on a mission alone, and in order to generate profits and revenue, it needs capital to operate. On the other side, consumers look for opportunities to contribute to the causes they care about, and outside of the very wealthy, investing in companies that align with their personal values has largely been out of reach.
Thankfully, the rise of social media and internet literacy sees us living in an increasingly connected world and a new funding option has developed for small, green businesses looking to get off the ground and consumers who want do the right thing: crowdfunding. Defined as the practice of funding a project or venture by raising many small amounts of money from a large number of people (aka a crowd), popular and well-known platforms for this model include IndieGoGo, Kickstarter and GoFundMe.
One notable example of a recently successful crowdfunding campaign was held by GroBox One, the all-in-one, self-sustaining indoor hydroponics greenhouse setting out to make gardening accessible to anyone. Having met their goal more than seven times over, you can expect to see GroBox One in mainstream retailers by 2019 — right after the Kickstarter backers have received their products — bridging the gap between their goals and the marketplace while maintaining a clear vision.
Another venture comes from Israeli startup Supermeat, which set out to offset carbon footprints associated with raising livestock while supplying the demand for meat with a product grown in a lab. Since, the company attracted $3 million in early stage investments and has partnered with one of Europe’s biggest poultry producers, bridging the gap between their goals and the marketplace. The “clean meat” startup is led by capital firms that have backed other like startups such as Beyond Meat, the plant-based meat brand you can find on shelves in the U.S. today.
Building on the freedom and flexibility offered by the emerging crowdfunding options, President Obama in 2012 passed the JOBS Act, a piece of bipartisan legislation designed to support entrepreneurship by offering young, private businesses a way to crowdsource funds safely and effectively. A provision of the JOBS Act, called Regulation A, greatly expanded entrepreneurs’ access to capital, allowing them to crowdfund their capital raises and opened the door to non-accredited investors to participate in early stage investments, subject to SEC review.
TerraCycle US Inc., the U.S. subsidiary of TerraCycle, Inc., just announced that its $25 million Regulation A offering has been qualified by the U.S. Securities and Exchange Commission (SEC), thereby allowing anyone the opportunity to invest in our U.S. business for the first time. Through the Regulation A offering, TerraCycle US Inc., known for “recycling the unrecyclable,” seeks to use the proceeds from the offering to acquire related companies, increase staff and grow its business. Interested investors are invited to visit www.OwnTerraCycle.com or https://www.sec.gov/Archives/edgar/data/1714781/000114420418002133/tv483295_253g2.htm to view detailed information about the offering.
Up until recently, private companies (green or not) would raise capital by taking out a loan (also known as “debt financing,” which needs to be paid off with interest), “going public” through an IPO (Initial Public Offering) or accepting investments from wealthy (“accredited” and thus exempt from certain securities protections) investors. As they say, money is money, but these options can be limiting and often come with strings attached.
Today, crowdfunding can and is used to back causes and initiatives of all sizes, affording green initiatives the flexibility to set the terms of their raise, retain the vision for their project, and open up to as many potential backers as possible. Powered by the internet, consumers are connected to the things they care about, providing access to ventures that have the potential to make a real impact. Do a quick search for open crowdfunding campaigns and see what you find – you just might stumble upon the green initiative that moves you.