From Tech Crunch
Image Credits: Everdrop
Household cleaning chemicals in the form of a tablet that can be dissolved in water appear to have given rise to a number of startups. As well as Munich-based startup everdrop, there is also Atmo Home out of Berlin, as well as Grove Collaborative, Blueland, Smol, Spruce, Ocean Saver … the list goes on. Few, however, have managed to scale as fast as everdrop, and last year we covered how it had raised an €18 million Series A.
Everdrop has now closed an €80 million Series B financing round in equity and venture debt, led by the Belgian growth investor Sofina, the Impact Fund of the B Corp-certified Swiss banking group Lombard Odier and U.S.-based venture debt partner TriplePoint Capital. In addition to the new investors, the existing investors, Felix Capital from the U.K. and HV Capital and Vorwerk Ventures from Germany, also participated.
Launched in early 2020, everdrop allows people to avoid or simply reuse their plastic household cleaning bottles, as well as reducing CO2 emissions in the transport of these goods by up to 95% because the tablets that make the product simply arrive in the post. Everdrop, and its competitors, also benefited from the effects of the pandemic, as lockdowns made it harder to physically go shopping, and now that behavior is far more baked-in to society.
Everdrop claims its figures include six-digit subscription numbers and 300% year-on-year growth in 2021. It markets 40 household products, body care products and has a footprint in Germany, Austria, Switzerland, Italy and France.
Speaking to me over a call David Löwe, one of everdrop’s co-founders, told me:
The investment is basically for three growth pillars. Extending our product portfolio; becoming an omni channel brand; and thirdly the international patent. We also set up our own R&D laboratory, including product-focused and research and development.
I asked him what has changed in the market to date?
“We started in the pandemic, went straight into a war and now inflation, speculation and so much uncertainty. So, it’s been a tough, tough ride. In general, I would say although the whole e-commerce industry is shrinking, but last year, we actually recorded 300% growth. I think the main reason is that people realise that even in those times, we really need to change something otherwise our planet has a problem,” he said.
In a statement Harold Boël, CEO of Sofina, said: “Everdrop has the potential to drive positive change in the CPG landscape.”
While Everdrop expands geographically and product-wise, there are clearly growing pains.
A March 2021 German review of its products wasn’t entirely glowing, although everdrop denies the critical claims made about its products, and also noting that it has been awarded a positive “ÖKO Test”, which is testing institute in Germany for sustainable products.
And there are signs there is plenty to be mined from this category, and thus more competition is coming. Atmo Home, for instance, focuses on “holistic sustainability” (using up-cycled, durable materials) to appeal even more to conscious consumers, suggesting there will be a “race” to be seen as the more climate-conscious brand.
Indeed, the successful businesses in this space are likely to be startups that can’t just scale but can also build enduring brands, since consumers won’t stick with a product if it doesn’t actually work or fulfill its climate claims.
Building a cleaner world: Our investment in everdrop
Felix capital leads Series A round to accelerate everdrop’s mission to become the global sustainable consumer goods company
At Felix, we are obsessed with founders and teams that pioneer cultural shifts at a global scale and are building strong brands that move the world forward. Over the past years, one of these cultural shifts is increasing awareness of sustainability — as the climate crisis and plastic pollution become ever more urgent issues — and growing interest in adopting a more sustainable lifestyle.
We are strong believers in the urgency to tackle this global crisis and eager practitioners ourselves. Over the past years, we have been searching for products, services and platforms fulfilling people’s quest for a more sustainable lifestyle. This led us to partner with businesses such as Oatly (plant-based food), NoIssue (sustainable packaging), or VanMoof (e- bikes). Today, we are thrilled to share our investment in everdrop — a company aiming to revolutionise household products, starting with the cleaning aisle!
The need for a sustainable lifestyle
Whereas unfortunately just 10 years ago, environmental activism was seen by many as a relatively niche concern (Pew research shows that as recently as 2013 only 40% of Americans were significantly concerned with climate change), now in 2020 over 70% of people globally recognise it as one of the biggest threats facing our planet. Increasingly the majority of Gen X, Millennials and Gen Z also prefer (by 4–6x more!) to buy from sustainable brands and brands that share their values.
Sustainable living is thankfully becoming more mainstream — and increasingly easier to access — in many areas of our life: in the food we eat, the clothes we wear, and the transportation we take. The #plasticfree and #zerowaste movements have accelerated while consumers look to their local communities and online social media platforms for education and inspiration. In parallel, more Fortune 500 companies are pledging to become carbon neutral.
However, for most of us, our homes are still inundated with single-use plastic bottles, and the smell of industrial cleaning chemicals. In Europe alone, more than 4 billion plastic bottles make their way to our planet every year — just from home cleaning supplies (for a sense of scale, this is enough volume to completely fill the Thames at least 10 times over!)
The global home cleaning market is large, yet undisrupted for decades. Out of the large $160bn home cleaning market, only $4bn has been occupied by green products, but this segment is growing rapidly due to the rise in demand. However, at the moment, many sustainable products are often still expensive, ineffective, aesthetically poorly designed or are only sustainable in parts (e.g., formulated with organic ingredients but still use single-use plastic bottles or contain microplastics). Everdrop is on the journey to eliminate these barriers by creating better-for-the-planet and better-for-your-home products, conveniently purchased online (and soon in select partner stores in Germany). They have demonstrated, since launching only 14 months ago, that a sustainable, well designed household can be accessible to everyone.
Crafting products with a story
Everdrop launched their first products in January 2020 — concentrated cleaning tablets that could be turned into kitchen, glass and bathroom cleaning sprays when dissolved in water at home, thus eliminating the need to ship water, and more importantly, the need for single-use plastic bottles. This packaging change also enabled them to sell and ship directly to their customers — something traditional cleaning products aren’t able to due to prohibitively expensive shipping costs. Every tablet costs €1, a price point accessible to most sustainability enthused customers.
Everdrop quickly followed up with new product lines, each thoughtfully designed with their own twist from traditional products in the category. Everdrop’s laundry detergents are personalised based on the customer’s local water hardness level, saving up to 50% of the unnecessary surfactants in the detergent compared to incumbent brands. Everdrop’s dishwasher tablets are “naked”, unlike conventional tablets that are individually packaged by a coat of single-use wrapper. Sustainability is a core tenant of the company and runs through everything from the ingredients to formulation to manufacturing and packaging (and even their new office space — which is in a carbon neutral building!), and all everdrop products are also 100% vegan and biodegradable.
With such authentic storytelling, these supposedly boring everyday products come to life. Every everdrop product has its own mission statement that resonates with the customers, helping them take a step towards making the world a cleaner place.
Founders on a mission to create a movement
At Felix, we are impressed by founders who are able to build brands and communities in a refreshingly authentic, and heart-felt manner. When we met David, Christian and Daniel at everdrop, we immediately felt their passion for this mission — even through a Zoom screen!
The three founders met as friends and bonded over all becoming fathers for the first time. Feeling the responsibility we have for the next generation, they made the commitment to “make sustainability accessible to everyone”, and everdrop was born. We love hearing their ambition for the brand — when asked “where would like you to see everdrop in the next 5 or 10 years”, rather than quoting a valuation number or revenue target, the team admitted that they’d most like to see a real quantitative reduction in carbon emissions and to be driving a broader movement in consumer packaged goods industry towards carbon neutrality.
Everdrop aspires to not just build a company and brand, but lead a movement. Through their range of laundry detergent, dishwashing tablets, and cleaning sprays, the company has so far helped European homes avoid 2.5m single-use plastic bottles and 250 tonnes of chemicals, and this is just the beginning. The brand has built an Instagram community of 110k fans, and is growing by the hour. The amount of user generated content — product reviews, unboxing videos, sustainability tips — flood the brand’s hashtag #everdrop.
As recognition for their impact thus far, everdrop was also awarded the 2021 German Sustainability Award of Design, a prestigious prize granted by the German Federal Government, UNESCO and UNICEF to companies and products leading sustainable design.
Welcome to the Felix family, everdrop!
At Felix, we are constantly on the search for brands and companies that transform the customer journey by capturing cultural shifts in our society. These brands are often design-centric, community-led, and as a result, receive an overwhelming amount of customer love. Everdrop encapsulates many of these qualities, and along with our friends at HV Capital and Vorwerk Capital, we are thrilled to join their journey in building a cleaner world together!