Investing into circular economy SMEs

 

Advance London aims to create the right conditions in London for circular economy SMEs to receive funding and support to hone their business models and grow their business. The Advance London investment fund will be used to catalyse investment into innovative circular economy solutions to reduce the increasing pressure on London’s resources; with a programme designed to support SMEs from early seed stage through to growth capital.

To date, LWARB has deployed £42m of investment capital, leveraging in a further £91m of private sector investment. Our investments have ranged from traditional waste treatment facilities to, furniture re-use and investments into private equity funds seeking high growth circular economy businesses.

The Mayor has set ambitious targets for London including reaching a 65% recycling rate by 2030, realising the economic value reuse, repair, remanufacturing and materials innovation can bring to London, and putting London on track to be a zero carbon city by 2050.  LWARB research has shown there is a value opportunity of at least £7 billion annually by 2036 through transitioning London to a circular economy.

To enable London to achieve these targets LWARB is supporting London’s transition to a Circular City. The circular economy offers a solution that creates new revenue streams, builds resilience and margin enhancement through more effective ensures better use of resources. It improves the interaction between businesses, supply chains and customers, whilst contributing to a reduction in waste, carbon and air pollutants. LWARB is committed to supporting circular business models which include:

  • Using renewable inputs – shifting to use of renewable energy or secondary materials in the input process
  • Recovering value at the end of product life through biological or technical recycling
  • Prolonging product life through smart design, use of data analytics, remanufacture and maintenance
  • Operating in the sharing economy i.e. sharing assets such as cars, rooms, machinery
  • Selling products as services – selling access to products whilst retaining ownership, or dematerialising products (e.g. books or on-line shopping).

LWARB launched a new business plan in March 2017 which sets out the investment programme for 2017-2020. It has been designed to support London based circular economy SMEs, at all stages of development, with innovative solutions to the use of resources in the capital.

Investment Programme

LWARB’s investment programme will focus on investing, alongside private sector partners, to support businesses looking to develop or scale up circular business models. LWARB will prioritise investing through fund intermediaries in order to maximise impact across as wide a range of businesses as possible.

Advance London’s investment programme will provide a suite of initiatives aimed at catalysing private sector engagement in the circular economy. These will include:

  • Innovation Challenges, such as the one held in December 2016 in collaboration with Climate KIC
  • Accelerator/Incubator Programmes to seed startups with innovative circular economy propositions
  • Venture Capital Funding
  • Private Equity Growth Funding

The investment strategy seeks to provide support to SMEs of all sizes and at different stages of their lifecycle, from startup through to maturity. These programmes have significant potential to create innovative solutions to London’s pressing waste management issues by:

  • Helping reduce and eliminate waste within London through increased resource efficiency and greater recycling of materials
  • Reducing pollutants (including air quality pollutants) and contributing to development of a zero carbon city by making better use of the existing assets and infrastructure within the city and leveraging technology innovation
  • Creating jobs through developing new business models and revenue streams from waste products and circular technologies, with the potential to add significant GDP to London’s economy
  • Helping foster valuable collaboration between key stakeholders within London, including start-ups, SMEs, social enterprises, corporates, advisors, academia and the public sector
  • Raising awareness of the environmental benefits of circular models such as leasing, sharing and durability, to drive behaviour change
  • Generating financial returns for LWARB to recycle into future programmes.

LWARB operates a collaborative model and will be working with corporate, financial, academic, and public sector partners to deliver the investment programme. We are looking for partners who have a vested interest in creating economic value, and developing a more circular ecosystem within the capital.

Get in touch

If you are interested in collaborating or would like to know more about the investment programme please contact:

Stuart Ferguson – Head of Investment (stuart.ferguson@lwarb.gov.uk) or

Jessica Brodrick – Business Development Officer (jessica.brodrick@lwarb.gov.uk)