When Alter Eco began vying for supermarket shelf space nine years ago, the company’s biggest asset was a passionate pitch. Its four European co-founders—Tristan Lecomte, Mathieu Senard, Edouard Rollet and Ilse Keijzer—had all traveled extensively while working for nonprofits, and they befriended small farmers in places including Thailand, Cambodia and Senegal, where they tried unusual foods like purple rice.
“We were so touched by the farmers’ generosity and the quality of their foods that we wanted to share those foods when we came home,” says Edouard Rollet, Alter Eco’s president. “But we had a bigger mission, too. We wanted to show that we could be a profitable business while having a positive impact on our ecosystem, our planet and the people who live on it.”
A prime example of that mission in action is Alter Eco’s work with the Acopagro Cooperative in the Peruvian Amazon, which supplies cocoa for the company’s chocolates. Alter Eco pays the farmers a fair trade price plus a premium (essentially, a donation) that contributes to meeting community needs such a new co-op office and medical coverage for farmers. Alter Eco also supports the co-op’s reforestation projects: along with several other companies, it has helped finance the planting of 2 million trees, and there are plans to fund 8 million more in the next five years. As a result of this reforestation work, Alter Eco’s operations are carbon negative, Rollet says.
New Resource Bank injects working capital
Market buyers, distributors and foodies responded to Alter Eco’s pitch—and to the company’s organic and fair trade chocolate, quinoa, rice and sugar. But like most start-ups, Alter Eco struggled to become profitable. For the first two years, Rollet and Senard lived and worked in a one-room San Francisco apartment, with a couple of beds beside their desks. The company began to break even just last year, which is also when New Resource extended a line of credit.
“We came in as early as a debt provider can come in,” says Gary Groff, the bank’s senior vice president, commercial banking. “We wanted to provide them with the working capital they needed to grow.” The line of credit has helped Alter Eco pay quinoa farmers right at the time of harvest, and helped finance the raw materials required for its innovative compostable packaging.
Packaging project could yield widespread benefits
Alter Eco realized that to be fully sustainable, it would need to keep its packaging out of landfills. So the company’s team partnered with OSC2, a group of Bay Area natural foods companies, to develop first-of-its-kind entirely compostable packaging, made of non-GMO birch and eucalyptus. Alter Eco now wraps its truffles in the packaging, and the company is testing compostable pouches for its quinoa, rice and sugar.
“We’re starting to think of packaging as an ingredient,” says Rollet, “one that will break down even in a home garden.”
Alter Eco hopes that other companies will adopt the technology—a vision that New Resource supports. Groff recently introduced Rollet to fellow bank client Ritual Coffee, which wants compostable bags for its beans.
“I’m always talking up Alter Eco as an example of a company that’s really being successful while doing the right thing,” he says, “and I love it when we can find solutions for our clients that aren’t just about finance.”