Sir Richard Branson opened his first record shop in London in 1971. Reminiscing at Fast Company‘s Most Innovative Companies Summit, he described it as a hippie’s dream: “Cushions on the floor, headphones, a joint or two in most people’s hands,” he said. “It was those days when you could pick up a Dark Side of the Moon sleeve, and you could feel it.” 51 years later, Branson’s new venture—his first foray into retail since the end of his music business—could be “the Sex Pistols of household care goods.”
That was an analogy offered by Fast Company Editorial Director Jill Bernstein. She was referring to Branson’s investment in the punk rock company of the household goods industry, Grove Collaborative, which aims to ditch plastic in its products by 2025—and to take the rest of the industry with it. CEO Stuart Landesberg joined Branson and Bernstein to discuss how the plastic crisis mirrors the climate crisis, and how he views Grove at the forefront of the sustainable shift. Branson will help it achieve that via a merger with Virgin.
“Our industry is so big and in need of such massive change,” Landesberg said, given that almost every household uses the industry’s products, and almost every product is single-use plastic. Besides, only 9% of plastics are recycled. “Plastic recycling is actually a myth that was created by the petrochemicals lobby to make us feel okay using this substrate that’s really cheap to create, but lasts forever,” he said.
Grove Collaborative, which sells soap concentrates, reusable glass spray bottles, and refillable deodorant and lotion packaged in aluminum, aims to be 100% plastic-free by 2025, a much more ambitious goal compared to other companies, which typically shoot for plastic neutrality, and even then, by later dates. Grove says it’s on track to meet its goal, and that it’s already removed the equivalent of the weight of nearly 485 million plastic bottles from the Earth.
Products aside, it’s also innovated by inventing the Plastic Scorecard, a label on products that certifies them as plastic free or neutral, which it hopes can extend to the whole industry. “Part of being a good steward means making sure we have the capital to achieve that vision,” he said.
That’s where Branson comes in. Virgin has set up a special purpose acquisition company, or SPAC, called Virgin Group Acquisition Corp II, essentially a shell company with the purpose to raise money via an IPO. It will then merge with Grove and take the company public, likely in the first half of 2022. The deal has valued Grove at $1.5 billion. (In preparation for the merger, Grove reportedly laid off 17% of its staff in March, to help financially position it for “success in the long term.”)
Branson said he took interest in Grove due to its mission, which aligned with a Virgin policy change that “any new investments we make from now on have to better the world.” He also believed in the product. He reflected that when his airline Virgin Atlantic launched, it was the underdog. “Because we were better than British Airways,” he claimed, “people sought us out.” The same applies to Grove, he said: “The best almost always survives.”
Landesberg contemplated how the plastic crisis mirrors the climate crisis — both originate from the extraction of fossil-fuels—and said he believes that reducing plastics use is achievable because people are convinced it’s a real problem: 84% of Americans are worried about plastic pollution. “It is hard to get 84% of the U.S. to agree the sky is blue these days,” he said. While people are still denying that climate change is human-made, he says, “nobody can disagree that, hey, this plastic bottle exists.”