Impatient with patient capital

Have we reached the limits of growth? 

Let the year of construction of his classic also happen to be the year in which the Club of Rome came up with the report "Limits to Growth. In this report, the club examined the relationship between the five major world problems: the growth of the world population, food production, industrialization, resource depletion and environmental pollution. With all the innovation and development, have we really made any progress since ...? 

I like to see the glass half full!

I am grateful to work every day with forward-thinking entrepreneurs who stick their necks out to actually achieve change. In all kinds of ways. From a sustainable cremation furnace to advanced plastic recycling. From regenerative agriculture to lightweight solar panels. That, as an investment manager, I get to play a modest role in realizing these sustainable ambitions is unprecedented. 

We desperately need these pioneers

After years of huge investments in "software as a service" and consequently exceptional growth of companies such as Google and Airbnb, we finally seem to see that we are not going to save the world with software (alone). We also need different kinds of entrepreneurs. We need that for real change, to combat biodiversity loss, global warming, water scarcity and chemical pollution. We need entrepreneurs who venture into groundbreaking deep tech technologies. But also social entrepreneurs. Like Mark Venner of Leuker who is the first generation since 1818 to transform dairy farms into food forests.  

Startups face a double challenge

A good dose of guts, perseverance and patience are indispensable for any startup. If only to maneuver through the "valley of death. But pioneers in the climate transition face additional obstacles. A case in point is Healix. For our recent investment in this forward-thinking company, I dove fully into the dynamics of the plastics industry. 

"A good dose of guts, perseverance and patience are indispensable for any startup. But just a little more so for pioneers in the climate transition.

Annemoon and colleague Stefan at Healix. Pictured from left to right:Marcel Alberts (Healix), Annemoon Borst (LIOF), Stefan Vocks (LIOF), Sjoerdje Meijers, Jean-Pierre Hendriks and Stefan Beckers (Healix). 

100% virgin

The price of virgin plastics has been unprecedentedly low for some time. Many producers in European countries then prefer cheaper products with 100% virgin material to more expensive alternatives with recyclate. Legislation to address this is not expected until between 2025 and 2030. Until then, unfortunately, price still seems to almost always win out over planet. Just face it as a startup that has just invested heavily in a recycling plant ... 

That just takes time

Financing the ambitious plans of sustainable frontrunners is often a challenge. After all, they need time to develop technologies, validate their business case and, above all, convince their buyers. For many investors, that means more risk. They also often work with a fixed term of their funds. A term that usually does not correspond to the period the frontrunner needs to prove itself. That takes time - and therefore patience. Better said: patient capital. 

Patience is a virtue

Fortunately, there are more and more financiers who do take the planet into account and have a longer horizon. And despite my impatience with the slowness with which we are tackling the climate issue, I am proud that at LIOF we are doing our bit by providing patient capital. That means investing in socially responsible initiatives that pursue non-financial objectives in addition to long-term financial returns. This is one of the driving forces in my work. And that, in turn, makes patience a virtue for me.