Tuesday, 23 July 2024
by BD Banks
Image source: Upsplash/The Motley Fool
One of the best bits of advice I ever received about starting a business was to make sure I did something that aligned with my interests and values. Whatever your reasons for becoming an entrepreneur, building your own company takes time and energy. It’s much easier to get through some of those stressful moments or intense all-nighters when you’re doing something you believe in.
Issues of climate change and sustainability are very much top of mind for a lot of people right now.
If you are worried about the environment and try to follow eco-friendly practices at home, there are several ways you can incorporate those same values into your startup. Even better? It could be good for your bottom line.
Research by Deloitte shows that customers are not only willing to switch to brands that reflect their values, but they may also pay more for those eco-friendly products, as well. Its investigation into green products showed consumers were willing to pay a premium of 27% for sustainable brands that deliver.
High levels of consumer awareness mean there are a lot of opportunities for startups that help the planet. Here are three possibilities to explore.
If you’re looking for an eco-friendly small business with a relatively low barrier to entry, it’s worth brainstorming upcycling projects. You’re essentially taking something that may otherwise go to a landfill and giving it a new lease of life. That can translate to lower start-up costs.
Upcycling business ideas include:
As the name suggests, this New-York-based clothes brand is committed to sustainable and stylish designs that don’t waste a single thread. It uses pre-consumer waste and other materials that are hard to recycle.
Almost 70% of those surveyed in Trip.com’s 2022 Sustainable Travel Consumer Report said they were actively seeking sustainable travel options. People are concerned about greenhouse gas emissions and the impact of tourism on local environments. You might capitalize on carbon concerns by creating eco-tourism projects closer to home. For example, there might be demand for a yoga retreat, eco-glamping, or unique hiking opportunities.
Thinking internationally, perhaps you can set up a green international tour agency that helps clients connect with hotels, tours, and experiences that are really eco-friendly. There’s a lot of greenwashing around. If you have connections in a particular country or can help visitors better understand a specific culture, this is a good place to start.
Staze is a hotel booking site that helps you find hotels that are serious about cutting emissions. Let’s say you are heading to London for a few days. The site will tell you the carbon footprint of your stay. Not only that, it will offset those emissions through projects such as tree planting.
If you have knowledge or experience in banking, insurance, fintech, loans, or investment, you can put a green spin on those skills. One route would be to help legitimate eco-friendly businesses access the funding they need to grow. Another might be crowdfunded loans for solar panel projects. Or climate-focused insurance, carbon accounting, reforestation, and more. You might even help startups access green business bank accounts.
The important thing is to match your financial skills with a solid understanding of environmental issues and challenges that need to be solved. Don’t be afraid to look for partners who can fill your knowledge gaps or collaborate on complementary projects.
Treecard originally started by issuing wooden debit cards. Now it is an app that rewards people for walking instead of driving, supporting ethical businesses, and more.
There are hundreds of ways you can build an eco-friendly startup, no matter what line of business you’re in. That said, don’t assume that your green credentials alone will make your company successful.
You still need to do your research to understand the competition and level of customer demand. Write a business plan and map out your finances. Think about how you’re going to build your brand and reach your customers.
Try to build your eco-values into every part of your business from the outset. This will help you to avoid greenwashing. Consumers will quickly see through that type of false branding, which will undermine your credentials. On top of which, you won’t actually be helping the planet.
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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Emma Newbery has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Etsy. The Motley Fool has a disclosure policy.