SXSW 2022: Building the Sustainable Startups of the Future
As the imperative to tackle climate change mounts and more consumers seek brands that align with their environmental values, major companies have sustainability firmly on their radar. But implementing green initiatives is easier said than done — which is why we assembled a panel of founders paving the way for a more proactive future in their industries. At SXSW 2022, Revolution Growth Partner, Todd Klein, joined SparkCharge CEO and founder, Josh Aviv, GoodBuy Gear CEO and co-founder, Kristin Langenfeld, and CAVA CEO and co-founder, Brett Schulman, for a conversation on climate, consumers, and building the sustainable startups of the future. Below are a few takeaways from the discussion:
Mission is a Magnet: Amid a talent war, compensation, benefits, and work-life balance have sway — but candidates are also looking for a vision they can get behind. Startups with sustainability at the center of their business offer both an incentive for talented employees to join their team and a stickiness as employees see the fruits of their labor firsthand. “Recruiting is one of the biggest challenges we all face today,” GoodBuy Gear CEO, Kristin Langenfeld, said. “For us, our focus on reducing consumerism and enabling a circular economy has drawn passionate candidates who care about our mission and want to do more than earn a paycheck.”
Reduce and Reuse First: The three R’s may hold equal weight in our minds, but the first two are paramount. Why? Because it takes far more energy to recycle than it does to make less stuff and repurpose what already exists. CAVA has adopted this ethos in several ways, including eliminating Saran Wrap from back-of-house operations. Another waste-reducing initiative: using the residual liquid from cooking chickpeas (known as aquafaba) to make more flavorful and sustainable garlic dressing. For GoodBuy Gear, the entire business model revolves around recommerce, allowing parents to shop and sell quality used baby and kids gear that would otherwise end up in landfills.
Startups are a Sustainability Accelerant: Unlike industry incumbents with slower, more outdated frameworks, startups often build with sustainability at the forefront of their business — even (and especially) as the company scales. This nimbleness, paired with an offering catered to the modern values-driven consumer, allowed Sparkcharge to get its mobile charging service up and running in three cities in under 14 days. It also allowed GoodBuy Gear to test initiatives and ultimately succeed in ways that positioned the company as an attractive partner to more established brands.
Partner Alignment is Critical: It can be hard to know whether a potential business partner — from a supplier to an investor — is on the same page as you. That’s why diligence is vital. For CAVA, that includes sourcing ingredients directly rather than through a distributor, establishing relationships with suppliers from the start, and conducting annual audits and onsite visits to ensure practices are up to the company’s sustainable and ethical standards.
Measure, Measure, Measure: A sustainable claim is only as good as the metrics you have to back it up. That’s why GoodBuy Gear and Sparkcharge put personalized KPIs front and center. From miles delivered to carbon emissions avoided, numbers help customers see how their everyday actions make an impact. Tracking metrics also helps both companies cater to their end-user. For Sparkcharge, a significant insight drawn from customer data was users’ preference for scheduling services. The finding allowed the company to expand its book-in-advance offering to give customers more options and freedom.
Risk Calculus Shifts as a Sustainable Company Scales: It’s easy to adopt a “move fast and break things” mindset when a company is small and the inevitable failures are less visible. However, while being more methodical is essential, a scaling company shouldn’t lose its entrepreneurial spirit. Instead, as Schulman emphasized, agility and precision are crucial. “The metaphor I like to use is going from maneuvering a speedboat to turning a supertanker. Shifts or new ventures for CAVA require more discipline and process than they used to, but deeply embedded value alignment allows us to continue to make decisions at speed.”
Convenience is Key To Changing Consumer Behavior: Habits are hard to break. To convince consumers to deviate from their tried and true ways, sustainable startups need to offer simpler, more customized, and more convenient products or services. For GoodBuy Gear, that includes meeting the customer where they are and quality checking, photographing, and listing gear for parents to spare them the time and effort.
Making Sustainably Sound Decisions isn’t Cheap: Sometimes, initiatives that are helpful to the planet hurt the bottom line. But costs today — particularly ones that allow a company to stay true to its sustainable values — often pay dividends down the road. That’s been the case for CAVA, whose ethical sourcing helped generate the customer affinity and loyalty the company sees today.
Accessibility Needs to be Part of the Conversation: We often talk about why consumers fail to adopt sustainable practices without discussing accessibility. That paradigm needs to shift — and companies play a significant role in ensuring people from all geographies, communities, and income brackets have the resources to participate in the green economy. Take it from Aviv, who used existing data to identify “charging deserts” (or places without EV infrastructure), most often within marginalized communities. To bridge the gap, Sparkcharge developed its mobile charging service to blanket cities with energy regardless of zip code. The result: Formerly overlooked neighborhoods became some of the most active locations requesting range.
So, what does the future hold for sustainable startups? That’s to be determined. But, if the enthusiasm I felt at SXSW and today’s consumer values are any indication, I predict we’ll see an acceleration of companies like CAVA, GoodBuy Gear, and SparkCharge rising to meet the moment.
