A US$106 million Singapore-based fund has been launched to protect Asia’s oceans from plastic. The Circulate Capital Ocean Fund (CCOF) is the world’s first investment fund dedicated to addressing Asia’s plastic crisis. The Singapore-based fund is also one of the ten largest ASEAN-based Venture Capital Funds in the market.*
With 60% of ocean plastic originating from the region**, Asia is the biggest source of plastic leakage into global oceans. A recent Ocean Conservancy Report identified a net financing gap between USD$28 and USD$40 per ton for plastic waste collection in the five top ocean polluting countries in the world – China, Indonesia, Philippines, Thailand and Vietnam.
“The good news is that we are able to reduce nearly 50% of the world’s plastic leakage by investing in the waste and recycling sector in Asia, and even more if we invest in innovative materials and technologies. This is why we are here in Singapore – a strategic hub of Southeast Asia – to prove that investing in this sector is scalable for the region and can generate competitive returns while moving closer to solving the ocean plastic crisis,” explains Rob Kaplan, CEO Circulate Capital.
CCOF is launched by Circulate Capital, a Singapore-based and MAS licensed venture capital fund management company with founding investors and partners among the world’s leading companies; PepsiCo (the first investor), Procter & Gamble, Dow, Danone, Unilever, The Coca-Cola Company, and Chevron Phillips Chemical Company LLC.
To address the financing gap between available private capital and resources needed by Asia’s waste sector, CCOF will provide both debt and equity financing to waste management, recycling, and circular economy start-ups and SMEs in South and Southeast Asia focused on preventing plastic pollution. Circulate Capital has identified more than 200 investment potential opportunities across a range of industries in the region, with their first investments targeted in the coming weeks.
The fund’s launch comes at a time where the Singapore government has initiated recent green investment programs. These include the Monetary Authority of Singapore’s (MAS) recent commitment to US$2 billion of green investments directed at sustainable projects. The city state has also launched initiatives such as the Zero Waste Masterplan and a Resource Sustainability Bill as it aims to establish itself as the regional Circular Economy Centre of Excellence, driving green investment efforts around the region and the world.
Circulate Capital’s investment model seeks to mobilise institutional investors by blending concessionary funds with investment capital. Its objective is to mitigate risk and demonstrate that investments in turning waste into value can ultimately provide attractive financial returns.
“For the beverage sector, the more recycled content used in any type of packaging such as 100% recyclable plastics, the lower the carbon footprint. That’s why at Coca-Cola we have invested in Circulate Capital and have committed to collect and recycle the equivalent of every bottle or can we produce by 2030. Beverage packaging does not need to become waste. By investing in the waste collection and recycling sector in this critical region, it can become a valuable material used again and again – a step closer towards a circular economy,” said Matt Echols, Vice President, Communications, Public Affairs and Sustainability Coca-Cola Asia Pacific.
“Circulate Capital plays a critical role in solving the issue of plastic waste in our environment,” said Bambang Candra, APAC Vice President Dow Packaging & Specialty Plastics.
“Supporting companies and infrastructure that are addressing plastic waste will catalyse the development of systems designed to advance a circular economy for plastics.”
Circulate Capital has also partnered with a number of nonprofit organisations, including Ocean Conservancy, Partnerships in Environmental Management for the Seas of East Asia (PEMSEA), and The Circulate Initiative (TCI), a nonprofit organisation launched in October 2019 dedicated to ending ocean plastic pollution and building thriving, inclusive economies. By combining the efforts of the Circulate Capital Ocean Fund, The Circulate Initiative and other partners, the quality and quantity of investable opportunities will increase and foster conditions which entrepreneurs in the waste ecosystem need to succeed.
* Singapore Venture Capital & Private Equity Association (SVCA) quarterly bulletin, October 2019
** Plastic waste inputs from land into the ocean, J.Jambeck, et al., Science (Feb 2015)