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Cleaning Up—and Greening—the Jewelry Industry

In the wake of the blood diamond controversy, there's a growing niche for sustainable and ethically created fine jewelry. Small businesses are stepping in to source and sell greener gemstones and gold.

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ECO CHIC: Meghan Connolly Haupt started her designer jewelry company, C5, when unable to find an engagement ring that was ethically and sustainably sourced.

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The auto industry has Elon Musk. The dairy industry has Gary Hirschberg. And soon, if one woman has her way, the jewelry industry may have its own sustainability visionary. Meet Meghan Connolly Haupt.

Haupt, the founder and owner of San Francisco-based C5 Company, has quietly over the past couple years carved out an eco-conscious niche in the $68 billion fine-jewelry industry. The business has spun into an online retail store—Sulusso.com—as well as her own namesake jewelry line. Celebrities such as Ed Begley Jr. and Rachelle Carson Begley have approached her interested in doing endorsements. This year, with half of its business from the local Bay area and roughly half with international customers, C5 is poised to more than double its 2009 revenue.

Until four years ago, Haupt had almost no experience selling jewelry. But armed with more than a decade of sustainability expertise, Haupt is determined to push the often-antiquated jewelry business into the 21st century. "Sustainability, as of three years ago, shockingly enough, was not even discussed," she says. Despite that sustainability is now such a buzz-word it borders on cliche, Haupt still calls herself "black sheep" because her work stands out at trade shows.

Because jewelry has so few regulations on raw-materials suppliers, Haupt decided to create her own. They include using gemstones that come either from labs or mines that make minimal damage to the earth and metal that is recycled and non-toxic. All her metal is manufactured in the United States. Haupt's purchases of sustainable materials are moreover becoming a vital source of income for regions without blood diamond conflict, a philantrhopic feat few other retailers can claim.

Lately, customer support has shown Haupt that her ideas, and ideals, are no longer just residing in a fringe movement.

The most significant inroads in bringing sustainable baubles to consumers have come from the bridal market, the area that first inspired her when she was on the path to being engaged four years ago. Unable to find a ring that matched her eco-conscious standards, Haupt set out to source the metal and diamond on her own. Quickly her custom work took off by word-of-mouth and through Internet searches requesting high quality, eco-friendly engagement rings. "I found a lot of people were highly receptive to what I was doing," Haupt says. "And several, not knowing it was a business, asked me to help them."

The green mantra, as yet not fully gestated in jewelry retail, could also be a way for smaller jewelry stores to distinguish themselves in an ailing industry. "People are spending less, buying less, but buying slightly more meaningful," Haupt says. Indeed, 34 percent of consumers are more likely to buy eco-friendly products than they were before the recession, a Cone Consumer Environmental Survey found last year.

"Embracing sustainability and attempting to bridge the supply chain is going to make a difference for a lot of people," says Jim Fiebig, global sales director for Zultanite Gems, a supplier of colored gemstones sourced from a completely sustainable and ethical mine in the Anatolian mountains of Turkey. Early-adopters have largely taken it upon themselves to scope out retailers such as C5 and Brilliant Earth, Fiebig says. This is why conventional retailers haven't recognized or capitalized on a market for it. But by giving their products an environmental cachet, tracing supplies from "mine to market," smaller stores can bring a wider swath of customers into the fold.

For Haupt, this grassroots approach could be her best chance at a breakthrough. Currently she is in merger talks with Wade Watson of Ruff&Cut, C5's biggest competitor in the fledgling sustainability space. Together they opened a pop-up store in downtown Manhattan this December and plan to launch a West Coast complement in Carmel, California, in February.

"If we merge resources, we're that much stronger to fight against our competitors," Haupt says. "The dangerous competitors are the ones who brand themselves as sustainable but have no way to prove it."

But how exactly do you prove it? In a market saturated with environmental and "conflict-free" claims, how do you differentiate?

The challenge to fast growth in this arena, Fiebig explains, comes not from building a customer base, but rather from finding upstanding sources. Only a handful of mines in the world use both eco-friendly and ethical practices. Almost all of the gold mined in the world is still in circulation, already recycled. And while reform efforts like the Kimberly Process attempt to certify shipments of gems from formerly war-torn countries, there is still very little regulation in the business as a whole. "The Kimberely Process has been rendered virtually useless because they did sanction Robert Mugabe's diamonds from Zimbabwe, and capitulated because he was going to sell anyway," Fiebig says. "That was the best attempt our industry has every made at attempting to police the un-policeable."

Vanguards such as C5 can claim higher ground on the bigger retailers by revitalizing local communities—an erstwhile blight on jewelry's image—that now thrive without conflict. "In developing countries, when people turn from subsistence agriculture to gemstone extraction, their income minimally triples," Fiebig says.

As Haupt likes to say, sustainability may now author a whole new story in the jewelry world: a fiancée's saying her diamond ring uses only recycled metal, that the stone was created in a lab that caused no harm to the earth, or that the creation and purchase of her ring helped aid education for an impoverished family in Africa. It's putting a fresh spin on diamond buying, a once-pleasant practice still reeling from the blood diamond pessimism of a few years ago. And Haupt stands resolute that this will reinvigorate the industry.

"The big retailers will go down this path eventually. It's inevitable," Haupt says. "Will it be in my lifetime? I'm not so sure. But the movement has started and there's no going back now."




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