Investment management firm Circulate Capital expects to secure up to $90m funding for its strategy to combat ocean plastic.
Circulate Capital is expecting to receive funding from major consumer packaged goods and chemical firms such as PepsiCo, Procter & Gamble, Dow, Danone, Unilever and Coca-Cola.
The company is planning to formalize definitive agreements with these firms by early 2019.
Circulate Capital founder and CEO Rob Kaplan said: “We seek to catalyze systems change by removing capital as a barrier to critical waste and recycling infrastructure development, and today’s funding announcement is a huge step towards achieving this goal.
“Institutional investors are unwilling to allocate to this sector because of a ‘missing middle’ — proven entities that demonstrate a track record of profitability and offer a robust pipeline of investment prospects.”
Circulate Capital, along with the founding investors and the Ocean Conservancy, will conduct a joint event during the Our Ocean Conference in Bali of Indonesia on October 29.
At the event, the partnership will provide an overview of Circulate Capital’s investment model, which is designed to offer lasting systems to solve the crisis of ocean plastic.
Ocean Conservancy is a major nonprofit environmental advocacy organization engaged in the protection of world’s ocean.
The mission of Circulate Capital is to show the investibility of the waste management and recycling sectors to gather institutional investment capital, which will be used to scale integrated recycling and waste management companies and infrastructure across South and Southeast Asia.
The funding will be used in these regions, as they are indentified as contributing disproportionately to ocean plastic pollution due to the lack of critical waste infrastructure to manage the problem.
Circulate Capital‘s investment model intends to gather institutional investment capital through financial structures, which combines concessionary and philanthropic funds with market rate investment capital to mitigate risk and show that investment in the resource recovery sector can offer better financial returns.
PepsiCo vice chairman and chief scientific officer Dr Mehmood Khan said: “We joined Circulate Capital as the very first funder because we share their inspired vision to develop a circular economy in which we can take old plastics and turn them into a new, reusable resource for future materials.”