Plastic garbage spilled from the container

We have a big problem with plastic. Just 14% of the plastic produced on the planet globally is recycled each year (per the OECD). Nearly all of it ends up in landfills. If it doesn’t find its way to a landfill, then the waste may end up in the ocean. The equivalent of one dump truck of plastic alone is tipped into the ocean every minute, every day. On an annualised basis, the total weight of all this plastic would be equivalent to 90 aircraft carriers (per Pew Research). Assuming this estimate is accurate, then by 2050, there will be more plastic by weight in the ocean than fish.

Rather than get too depressed by this possible outcome, it’s much better to think about potential solutions. To this end, we were lucky enough to meet with the management of Carbios, a €400m listed French business which believes that it may be able to help solve the plastic problem.

The company has a 12-year history and since its inception has worked with several local academic institutions to develop a set of proprietary enzymes which, it believes can help businesses rethink the life cycle of plastics. The technology developed by Carbios is protected by patent and works around the principles of biodegradation and bio-recycling. The company’s first goal is to target PET (polyethylene terephthalate) plastics – the stuff not only of drinks bottles but also many items of clothing (in the form of polyester). Carbios can already boast an impressive roster of partners ranging from L’Oréal and PepsiCo in the  consumer space to Puma and Patagonia within the textiles arena.

Carbios is still early in its journey, with the business at a pre-revenue stage and its first plant not set to be operational until early 2025. Nonetheless, its progress is admirable. The fact that Novozymes has come on board as an industrial partner also speaks to the potential of Carbios’ technology.

We have consistently highlighted plastic pollution as a problem that the world needs to solve. Solutions other than those being pioneered by Carbios will almost certainly emerge, but given the magnitude of the challenge, there is a sizeable addressable market opportunity for complementary technologies. Our larger concern is just how workable are broader commitments to circularity – both on the parts of governments and corporates. While the notion sounds simple in principle, in practice, it can be dauntingly complex. Beyond possible greenwashing issues (might companies be prioritising brand image over fundamentals?), we think detailed cost-benefit analysis is almost always necessary. Watch this space. Later in February, we will be releasing a detailed theme piece on the circular economy.  

2 February 2023

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​The above does not constitute investment advice and is the sole opinion of the author at the time of publication. Past performance is no guide to future performance and the value of investments and income from them can fall as well as rise.

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​Click here to view all Blog posts

Alex Gunz, Fund Manager ​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​


The document is provided for information purposes only and does not constitute investment advice or any recommendation to buy, or sell or otherwise transact in any investments. The document is not intended to be construed as investment research. The contents of this document are based upon sources of information which Heptagon Capital LLP believes to be reliable. However, except to the extent required by applicable law or regulations, no guarantee, warranty or representation (express or implied) is given as to the accuracy or completeness of this document or its contents and, Heptagon Capital LLP, its affiliate companies and its members, officers, employees, agents and advisors do not accept any liability or responsibility in respect of the information or any views expressed herein. Opinions expressed whether in general or in both on the performance of individual investments and in a wider economic context represent the views of the contributor at the time of preparation. Where this document provides forward-looking statements which are based on relevant reports, current opinions, expectations and projections, actual results could differ materially from those anticipated in such statements. All opinions and estimates included in the document are subject to change without notice and Heptagon Capital LLP is under no obligation to update or revise information contained in the document. Furthermore, Heptagon Capital LLP disclaims any liability for any loss, damage, costs or expenses (including direct, indirect, special and consequential) howsoever arising which any person may suffer or incur as a result of viewing or utilising any information included in this document. 

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