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The Magazine of the Rotman School of Management UNIVERSITY OF TORONTO
WINTER 2022
SUSTAINABILITY NOW! PAGES 20, 38, 89
MANAGEMENT
The Disrupted Issue
QUESTIONS FOR Nuha Siddiqui (RotComm ’18), CEO, Erthos
Q &A A wicked problem meets its match, thanks to a Rotman Commerce graduate.
Interview by Karen Christensen
126 / Rotman Magazine Winter 2022
A few years ago, the World Economic Forum predicted that by 2050, there will be more plastics in the ocean than fish. Describe how this prediction catalyzed you to action.
I was a student in the Rotman Commerce program at the time, and I was shocked by this prediction — particularly since I’d been hearing so much about rapid advancements in green technology. Clearly, significant barriers existed to the widespread adoption of sustainable technologies — and they needed to be addressed. I decided to spend some time researching why experts were predicting this dismal future. That’s how it all started. A few months later, through my involvement at Enactus — a global student entrepreneurship organization — I started a project called EcoPackers to produce compostable packaging. I was in my second year of the Commerce program at the time, studying business and environmental economics, and this was a way for me to bring my two worlds together and see if I could somehow contribute to saving the planet. After graduation, I brought on my two cofounders (also UofT alumni) and we pursued EcoPackers full-time, and it eventually morphed into Erthos.
Instead of working against all the existing infrastructure, it made much more sense to work alongside it.
For those who aren’t familiar with Erthos, please describe your mission.
We are transforming agricultural by-products into plantpowered materials that can be used as alternatives for traditional plastics. Our materials are both compatible with the existing plastics infrastructure and compostable at their end of life. The idea is to make sustainable materials a natural choice — and create a new standard for materials that puts our earth first. Tell us about your experience with the Creative Destruction Lab (CDL) at the Rotman School of Management.
We joined the CDL program in 2018 with EcoPackers, when we were still trying to make our packaging model work. We were really passionate about our mission, but we didn’t necessarily have a clear direction on how to scale the company. It was eye-opening for us to get a broad perspective on our business from successful entrepreneurs and investors. We had truly amazing mentors, and they were able to help us think about things a bit differently. They asked us questions like, ‘Is this really the most valuable way to leverage the technology you’re building?’ After taking a step back and realizing there could be a more impactful way to address the plastics issue, we pivoted to the model we have today and rebranded as Erthos. Within the CDL program’s eight-month time frame, we completely redesigned our business model, raised our first round of financing and got some early adopters to come on board. The experience was invaluable to us. Most start-ups set out to disrupt their industry or sector, but you have said your goal is to disrupt the plastics industry “as little as possible”. Please explain.
When we started out, my team and I thought the only way to make an impact would be to create alternative packaging. But as we started to understand the intricacies of the industry and the challenges that existed, we realized that instead of working against the existing infrastructure — manufacturers, converters and everyone else in the space — it made
much more sense to work alongside it. We recognized that integrating our materials into existing systems had the potential to benefit the planet much more significantly than running a stand-alone packaging company. Can you provide a bit more detail on how you approached your two greatest challenges—compatibility and compostability?
On the compatibility side, as indicated, we work within existing applications and systems to tackle the single-use plastic space, and a big part of that is making sure we are building a new standard for the compatibility requirements that exist with materials today. The fact is, plastics are extremely powerful. They have played a key role in many different industries for decades. But unfortunately, a lot of them are used to manufacture single- or limited-use products like cutlery and food packaging. So we set out to create materials that were compatible with these requirements and fit into existing systems like injection molding and other manufacturing systems. Our second big challenge was compostability. There are lots of other sustainable businesses out there focusing on different parts of the plastics problem. We wanted to create materials that are as natural as possible and can go directly into a compost bin and degrade. For us to feel authentic, we had to make sure we embedded sustainability within all aspects of our operations. That meant tracking all of our metrics — from the amount of energy and water we were using to our CO2 emissions — and making sure everything we do is sustainable. Is there a client partnership that best exemplifies your mission?
Our partnership with AB InBev, formerly known as Anheuser Busch, has been amazing. There is significant waste within the beverage industry, so we worked with them to identify all the different single-use plastics within their supply chains. We found many that would be perfect for our materials. The first project we worked on with them was a
rotmanmagazine.ca / 127
Our hope is that by 2050, all single-use plastics will be plant-powered with materials like ours.
plant-powered cap for their beer kegs. If you start to look for single-use plastics, you will see that they are everywhere. It’s not just about plastic water bottles!
captured by recycling — and they aren’t effective in terms of reducing or reusing, either. And yet, we remain dependent on them as a society. That is what drives us to rethink.
To date you have raised over seven million dollars, including support from Zoom’s investors. What lessons can you share from your funding journey?
Looking ahead, are you hopeful there will be more fish than plastics in the ocean by 2050?
It’s extremely important to make sure you have value-add investors from the very beginning. It’s also important to be very open to strategic opportunities. We raised our first round of funding through CDL with incredible investors within North America, and shortly thereafter, we raised another round with Horizon Ventures of Hong Kong. We didn’t intentionally plan it that way; it was really about making sure we were bringing in the right strategic investors at the right time to support our journey. I would say it’s extremely important to build relationships with investors early on, so they can track the progress you’re making. When the problem you are trying to solve is as massive as the one we are targeting, you need to have partners on board who believe in you and support your mission.
One hundred per cent — and I know a lot of sustainable technologies, including ours, want go beyond that. Our hope is that by 2050, all single-use plastics will be plant-powered with materials like ours.
Everyone is familiar with the three Rs; Reduce, Reuse, Recycle. Tell us about the fourth R that you’ve added to the mantra.
The fourth R is Rethink, and it’s our way of expressing that we respect where we’ve come from, but it’s time to evolve. The three Rs have been a crucial aspect of our society’s understanding of waste management, but the fact is, things have changed a lot over the years. Consumer behaviour has evolved significantly, and there is now a widespread understanding of environmental concerns. That’s why we felt it was time to introduce the idea of rethinking many aspects of our supply chain. We’re not saying people should stop reducing, reusing or recycling. Those things remain critical. But it’s important to understand that the materials we use every day need some rethinking. Single- or limited-use products are not 128 / Rotman Magazine Winter 2022
Nuha Siddiqui (RotComm ‘18) is the CEO of Erthos. She was recently
named the 2021 Rotman Leader to Watch at the School’s Reunite at Rotman event.
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