Naty is an innovative Swedish company that produces eco-friendly diapers and toiletry products. Marlene Sandberg, Founder and CEO of this industry frontrunner, discusses how she turned an idea into a multinational success, eco-conscious consumers and why she’s looking forward to having Triodos by her side.

An idea is born

Naty was founded in 1994 by Marlene Sandberg and offers biodegradable and environmentally friendly disposable diapers. The idea was conceived when she was pregnant with her second child and was reading a newspaper article about the high levels of waste that conventional diapers produce. Today’s leading diapers consist mainly of oil-based plastic materials and super absorbents that are non-renewable and non-compostable. “I thought to myself, this is crazy. Surely there must be some kind of solution. Someone needs to do something.”

Expanding ecological alternatives

Since that idea more than 22 years ago, Naty has grown into a professional FMCG (fast moving consumer goods) company with a current turnover of EUR 26 million from sales in 40 countries on four continents. Its products use FSC certified wood pulp, are 100% chlorine free, and contain no perfume. Naty’s diapers are already 51% renewable, and Marlene hopes to launch the next generation diaper (70% renewable) in 2017. The Naty product range has also expanded to include complementary baby care products, feminine care products and even eco-clothing for babies and children.

Nurturing conscious consumers

Naty enjoys strong authentic brand recognition and popularity amongst eco-conscious consumers. Marlene knows her “incredibly loyal” customers: “They investigate and navigate information about which products to buy. They don’t want their babies to be in contact with carcinogenic and hormone affecting chemicals. I know what information they’re looking for. We’ve always been clear about what is, and what isn’t in our products. Our customers want an alternative, and they look for superior quality and value. We offer this.” Naty products are also assessed by AB Vincotte, an independent third party that analyses their bio-based content. “Third party certification is relatively new for us. I think it is really important because consumers don’t really trust supplier statements. I look for certification when I buy my organic food, why would it be any different for diapers?”, says Marlene.

Growing pains

Despite the enormous success of Naty, the journey getting there hasn’t always been easy. Marlene and her team have faced tough challenges. In addition to the cash flow difficulties that many start ups face, in 2008 with the global financial crisis, a change in UK currency exchange rates saw Naty lose EUR 2.4 million in profit overnight. It went from being highly profitable to carrying a loss. “It was really tough, and I questioned whether to keep going. But we kept going. It’s important for an entrepreneur to be consistent and to never give up. You need to stay focused, and be patient.”

Slow to grow industry

This attitude, focus, and patience have been critical to Naty’s success, which remains a relatively smaller player in an extremely large industry. According to Marlene, it will have to wait for the bigger players to demand more eco-friendly materials so that the manufacturing factories will invest in the technology required. She says, “Unfortunately the market leaders have reduced the amount of pulp in their absorbing material and replaced it with super absorbents. But this increases the proportion of chemicals they use. Instead of becoming more sustainable, they’re moving in the opposite direction.”When asked about how Naty can compete with the larger competitors claim to have green products, Marlene talked about their expensive life cycle assessments (LCAs) saying, “It’s an easy way for them to claim they’re green, but they don’t go the whole way. They still use 100% oil-based materials in their products. Ours are made up of cornstarch and other natural ingredients wherever possible. Ours break down better so their end of life creates less impact on the environment.”

Partnering with Triodos Organic Growth Fund

Naty is one of the newest investments for Triodos Organic Growth Fund and both the fund and Naty are excited about their shared mission to bring sustainable consumption to the forefront. Marlene: “It was a combination of the right timing and the right investor. We wanted to consolidate our ownership structure. We felt it was better to have one large investor that’s committed for the long-term. We’ve been approached by many investors – banks, private investors – and always said no because we didn’t want to sell. Actually, what I like about Triodos is that it only invests in sustainable businesses, especially those committed to the environment and green technology. We share that mission, and that’s important. I was also motivated by the opportunity to meet and mix with the other companies that Triodos Organic Growth Fund invests in. I really look forward to the conference Triodos Organic Growth Fund will organise for privately owned mission-driven businesses in the organic food and sustainable consumer goods sectors in its portfolio. I look forward to meeting them and exchanging information. We can all learn from each other.”

Plans for continuing Naty’s success

Naty has a very strong online presence and distribution partners throughout the world, but to date the company’s marketing budget has been zero. Customers find them via word-of-mouth, internet searches and online customer reviews. Of future plans Marlene says, “We’re really excited that next year we will open our web shop and will have a marketing budget to promote it. We plan to provide lots of information about our products, and I’m really looking forward to it. It will be very interesting to see what effect it will have.” And for the longer term? “I can’t imagine that I will ever retire”, said Marlene. “I will continue because I want to increase the value of Naty. My goal is to have a turnover of about EUR 50 million within three to five years, to increase our product range and to continue to be a frontrunner by constantly looking for ways to increase the level of sustainability in our products.”

Starting your own company out of idealism and making the movement bigger. This is what Poppe Braam did. He is the founder and managing director of DO-IT, a Dutch company that imports and exports organic food products.

Poppe Braam can definitely be described as a pioneer in eating organically and sustainably grown food. His work takes him all over the world. Over 60% of the products that DO-IT it imports are produced outside Europe. This is why he frequently visits agriculture projects in Asia, Africa and Latin America. "Basmati rice from India, jasmine rice from Thailand and coconut milk from Sri Lanka. These are some of the organic products that we import from Asia."

The foundations for setting up an organic food company were laid as early as the 1960s and '70s, a period during which upscaling in agriculture started to take off. "In the 1960s my parents had a small farm with 15 cows, which at that time still got to keep their horns. Agriculture is therefore close to my heart." Braam believes that the increasingly large scale of farms has had all sorts of negative effects. "I saw that animals were being restricted. Their freedom of movement and well-being declined, humans started to rule over animals more than ever before and started to do as they saw fit."

Social critic

That was at odds with his view. "I feel that like humans, animals are also entitled to happiness. We may use them, but must never mistreat them," is his belief. Even as a student, Braam was part of a progressive, socially-critical undercurrent that put organic food on the map. During the production of organic food, the environment and animal welfare are taken into consideration whenever possible. For instance, animals have more space for living and moving about than on regular farms. Genetic engineering and chemical pesticides and herbicides are also not accepted. "The circular concept is at its core. Crops and animals do not suffer negative effects from our consumer behaviour," explains Braam. As an example he mentions the number of animals that are kept on farms. These must be in proportion to the area of land. The farmer must be able to use their manure on his own land or on the land of other farmers in the region, thus avoiding a manure surplus.

Pioneering

Based on his ideals, Braam started a chicken farm with 600 organic chickens. His activities started to expand during the 1980s. For instance, he was involved in establishing the SKAL institute, which monitors compliance with the regulations for organic farming. Braam also opened a shop and a distribution centre and owned a packaging company. "That entrepreneurship just grew and grew." In 1990 Braam decided to take a different course. "Organic food started as a movement, but has also become a business. Growing numbers of consumers think about the origin of their food. The demand for organic food has been on the rise for many years," says Braam. He sold his companies and set up DO-IT, the acronym for Dutch Organic International Trade. "But of course it also means: do it. Make the right choice for the planet. I hope that as many people as possible will realise that their current actions have an impact on how the world will look in the future."

Import and export

DO-IT imports and exports organic food products, such as rice, grain, sugar, coconut milk and coconut oil. "In fact, virtually all products, except coffee, tea and spices," summarises Braam. He started DO-IT on a modest scale. "Initially we only traded in all sorts of organically grown products that were produced in the Benelux, but demand just grew and grew. We received questions such as: do you also have olive oil or spaghetti from Italy? That is how the company kept expanding. At the moment, 60% of the products that we import are sourced outside Europe."
DO-IT has mainly set up its own agricultural projects, with small local farmers and cooperatives. Their products are shipped, stored in The Netherlands and subsequently exported again to dozens of countries, mainly in Europe.

Huge expansion

More and more consumers choose to eat organic food. "Around 5% of the Dutch population eats organic food. This is of course still a relatively small market, but compared to 1990, when that percentage was around 2%, we have obviously seen a huge expansion. We also benefit from this development." DO-IT's staff has grown to 60 employees and the company now realises annual sales of 70 million euros. "Only during the crisis of 2008-2011 did business remain more or less stable or registered a small gain at the most. Since 2012 we have been growing at a rate of around 10% per year," says Braam.

Sustainable ambitions

Braam also intends to invest in making his real estate more sustainable. He wants to equip DO-IT's premises with solar panels and a heat and cold storage system. "Our plan is to make our building energy-neutral in 2018. That fits in well with the principles of our company," says Braam. Another thorny issue is transport costs. "We also try to limit road transport. For instance, many of our containers are transported by ship to Nijmegen. From Nijmegen, they are then taken by road to our facility in Barneveld.”

He expects the company to expand further in the years ahead. "I did not consciously choose to eat organically; it was something I did automatically. But more and more consumers are starting to think about this issue. Is their food overly processed? Where has their food been grown? Increasing numbers of people are curious about that relationship." He sees this as pure gain. "Not only in an economic sense, but especially for people, planet and animals. After all, they are all intertwined and we must do justice to that. The circular concept of eating organically makes that possible."