What do tech billionaire Mike Cannon-Brookes, basketballer Matthew Dellavedova, cricketers Alyssa Healy and Mitchell Starc and footballer Nat Fyfe have in common with a ‘loo roll?
It’s not a trick question – the answer is the eco-friendly toilet paper company Who Gives A Crap, which recently announced a $41.5 million funding round on the back of a diverse set of investors including Cannon-Brookes, a list of corporate supporters, and a group of sportsmen and women.
And the breadth of investment in the company suggests to some observers in the corporate philanthropy and impact sectors that this could usher in a significant new era for social impact investing.
Who Gives A Crap started in 2013 with a crowdfunding campaign and established the model of eco-friendly toilet paper (and other paper products) combined with giving half its profits to improve global sanitation. It recently announced it had donated more than $10 million over the years to tackle the problem but the work goes on: there are still two billion people who are drinking contaminated water.
On the back of the pandemic-inspired toilet roll panic buying, the company was able to give away $5.5 million last year, which was more than the high-profile brands Coca-Cola Amatil, Qantas and AGL, according to Strive Philanthropy’s Giving Large report, the annual record of Australian corporate philanthropy.
Now, this investment round has shown that Who Gives A Crap could become a roll model for social impact investing.
One observer noted on LinkedIn, after the announcement was made: “Profit for purpose business can generate a return and, in some cases, a greater return than traditional business models.’’
Who Give A Crap Co-founder Simon Griffiths underlined the point when he announced the funding: “We hope this news rocks the business community. Not because we love fanfare, but because we want to pave the way for other businesses on a mission to do good.’’
The list of those who contributed to the round is diverse, and includes Brussels-based Verlinvest, London-based The Craftery, Jam Jar Investments, Cannon-Brookes’ Grok Ventures, AirTree Ventures as well as Giant Leap. Individual investors included Adore Beauty founders Kate Morris and James Height; Culture Amp’s Didier Elzinga and Doug English; former Unilever chief executive Paul Polman and some Athletic Ventures’ syndicate members including Dellavedova, cricketers Healy and Starc, footballers Fyfe, Josh Kelly and Matt de Boer and soccer’s Stefan Mauk.
Strive Philanthropy Co-founder Jarrod Miles hailed the investment initiative as “…a remarkable sign of the times and hopefully the times to come for business and social impact in Australia.’’
“To see such interest from such a wide range of savvy investors in a company that has built impact into its walls and toilet pipes from day one is outstanding,’’ he said.
Jarrod said it indicated that the “winds were changing’’.
“This announcement and the clear investor attention in this toilet paper start up is a fantastic vote of confidence that shareholders too are starting to see the benefits of integrated philanthropy,’’ he said.
The sentiment was echoed at investor Giant Leap, where CEO and Managing Partner Will Richardson described Who Gives A Crap as an “inspiration’’ when the fund was launched five years ago. “They were, and still are, an absolute game-changer in proving that placing impact at the heart of their business, can be a powerful way to create a high-growth business,’’ Will said.
“It feels right that this is the first investment for our new fund Giant Leap II. With this new funding round, we expect them to continue to create remarkable change through their sustainable products, their giving, and as role models for a new way of doing business,’’ he said.
Griffiths, who founded Who Gives A Crap with Jehan Ratnatunga and Danny Alexander, promised that the investment round would enable the company to scale up its operation, to enter more countries, make more products, and “…scaling our sustainability initiatives and finding new ways to help our community make a positive impact on the world.’’
“When we started, there really weren’t companies like ours. People didn’t think it could be done. Donating 50 percent of profits? As a start-up? Unheard of,’’ Simon said. “But we’ve proven that companies of all sizes can make a big difference. And our impact will only get bigger from here.’’
Mike Cannon-Brookes, co-founder and co-CEO of Atlassian, described Who Gives A Crap as an Australian underdog story.
“Simon and his team have taken something so simple - toilet paper - and turned it into an impactful business, both socially and environmentally,” he said last week. “I hope other entrepreneurs are inspired by their story of building a profitable, fast-growing business that is also environmentally sustainable.”
Another investor in Who Gives A Crap is Canva co-founder Cameron Adams, whose design start-up was also in the news after securing $276 million in new funding that pushed the company’s valuation up to $55 billion. Cameron, along with co-founders Melanie Perkins and Cliff Obrecht have set up the Canva Foundation, which will help fund poverty, biodiversity, and climate change initiatives, while also striving to support start-ups and entrepreneurs.
(Canva supports Pledge 1%, the philanthropic initiative that Atlassian co-founded in 2014 that enables start-ups to support their nominated charities. Head of the Atlassian Foundation Mark Reading explained the Pledge 1% in Philanthropy Weekly earlier this year as helping start-ups to “…bake philanthropy into their business model.’’ In practical terms that represents a commitment of 1 percent of the company’s time, product, profit and equity or a combination of all four, towards their chosen causes. As the business grows, so does the contribution.)
After Canva’s funding announcement Perkins and Obrecht pledged to give a 30 percent stake in the company to their foundation.
Jarrod Miles said the coincidence of the Who Gives A Crap and the Canva announcements pointed to a potential shift in business mindset.
“To see two remarkable Australian companies, who have built social impact and generous philanthropic pledges into their business models attract such attention from the investment community suggests an encouraging, socially minded, cultural shift in business,’’ he said.
“One which we can only hope will drive other companies big and small to adopt similar impact and giving models. ‘’