By Zev Herman, an entrepreneur focused on growing wholesale light bulb and lighting business.
As passionate as I am about environmentally conscious business solutions, I know that creating and implementing them isn't exactly a walk in the park. There are certain challenges that are come exclusively with starting a green business. The first of which is a certain presumption that such solutions are not economically viable, and therefore any business based on them is going to similarly non-viable. Both of those presumptions fly in the face of new developments going on in multiple major industries, like this "energy-positive" hotel (it's designed to produce more energy than it consumes) that is scheduled to be built in Norway. If you have dreams of a green startup, you may encounter the following roadblocks. But you're in luck, as there are solutions and some special opportunities that you may be able to take advantage of in your journey.
A High Entry-Barrier, or Start-Up Cost to Many Businesses
I'm not just a lover of green technology -- I'm also a realist. The fact of the matter is, many green startups require laboratory and research equipment that are harder to come by and provide than the simple chairs, desks and internet hookup needed by many other startups -- or for that matter, established companies. The thing to understand is that the average investor is risk-averse. A combination of high operating costs and the general uncertainty surrounding any new business will make your investments difficult to fund.
Know Your Audience, and Pitch to Places That Understand You
With extensive research, you can find investors that are interested in green business options specifically. This not to be mistaken for socially responsible investing -- the category of green investing is actually focused on conservation and optimal use of natural resources or creating and researching alternative energy sources. It can include clean air and water projects as well. Try to find out what the priorities of certain investors are, and remember, it is a big world with a wide variety of people who are interested in different things. Thanks to the digital world, research is faster than ever before. What I've learned is this: You can find just about anybody you need to connect with. Communicate your dream project in its best possible way, and you might secure the funds you need. Until then, there are laboratories and equipment that can be rented while you move your green dreams from prototype to reality. This will make you more likely to secure investors because people believe in what they can see. The more concrete your success becomes, the better off you will be.
The Big Vision: Why I Believe in Encouraging Investment in Green Technology
I do not believe people who shy away from green investing are "anti-science" or "anti-environment." However, people are anxious about their businesses, and every time they see a new regulation, a new fee or a new restriction, environmentalism in general gets a bad rap. However, reminding investors that efficient and ethical sources and systems are a growing demand from consumers will help here. Not only that, but studies show that green innovations are money-savers in the long term, eventually more than making up for the costs early on. My favorite innovations are those that improve both the economy and the environment. This can be on the level of the entire business or down the day-to-day supplies of your business such as pens, choice of water cups and more.
Zev Herman is President of Superior Lighting. He specializes in energy-efficient lighting design and retrofits.