Why you should invest in green small businesses, and how to do it!
Updated: Apr 18, 2022
Investing green is all the rage these days, especially when it comes to renewable energy and electric cars. But what about the Main Street businesses that are making a major impact on their communities by providing eco-friendly options and changing consumer habits?
Sustainable small businesses are leading the way by creating shared value between consumers and their beliefs, building a circular economy, creating tangible impact in their communities, and strengthening their communities.
Read on to find out more about green small businesses and how you can help support them this Earth Day through your investments. In this article, you'll learn:
Why you should invest in a small green business
What is a green small business and why should I care?
The World Commission on Environment defines sustainability as “development that meets the needs of present generations without compromising the needs of future generations.” This essentially means that the sustainable, green business seeks to seek a profit, but not at the cost of the environment or any social causes.
A green small business could take many different forms. It could be a rural farm that uses organic, agroecological practices to grow local produce, or a small coffee shop on a busy street that uses reusable or eco-friendly coffee cups, or anything in between. Green small businesses typically see their sustainability as an equally important piece of their business model as making a profit, and see both sides of the business as working together.
By investing in green small businesses, you’re enacting this definition by delaying immediate gratification for the greater good. You’re literally putting money you could use buying a couple of oat milk lattes into something that could support a small business’s sustainable initiatives and earn you a return in the process.
This also relates to the idea of shared value. Your investment in a green small business provides value not just for the business itself but also for the good of your community and the environment.
Learn more about the value that Honeycomb Credit investments make in local communities here
Green small businesses contribute to the circular economy
Green small businesses also contribute to the circular economy. A circular economy is one that is restorative and regenerative in its design. So, instead of a linear vision of economy, where it’s take-make-waste, it works to create solutions which regenerate the waste component into something new.
Honeycomb alum Compostable LA, a composting pick-up service in Los Angeles, is a perfect example of a circular economy - they diverted 50,000 pounds of food waste in 2020 and turned it into soil! Compostable LA raised $60,000 with Honeycomb in less than a week to expand their fleet of pickup vehicles and open up a new office space to support their mission.
Monique Figueiredo, founder of Compostable LA, says, “Composting takes something normally seen as a waste product and makes highly nutritious food for the soil. It’s actually a resource…that resource stays within the community and helps build community resilience.”
Compostable LA also raised their funds from 77 unique investors, showing that investing in small sustainable businesses is a community effort. By investing in green small businesses like Compostable LA, you too are contributing to this regenerative model of an economy, reducing waste and creating new opportunities.
“I have been composting since I was a small child thanks to my smart mom, and when I learned about Compostable LA it was exactly what I was looking for!” says Sarah, who invested in Compostable LA. “I am thrilled to be able to support an initiative that aligns with my belief that we should do more in our local communities to take care of our planet.”
You can tangibly see the impact of green businesses and be sure they aren’t greenwashing.
One of the grey areas of investing green is that sometimes you’re not quite sure that a business is really doing all they can do to save the environment, even if they claim to be doing so. This is a phenomenon known as greenwashing, where companies make false, unsubstantiated claims about their “sustainability.”
Greenwashing is common among industries that are some of the largest carbon emitters, such as energy companies. Another example is when consumer-packaged goods companies rebrand the same products as more environmentally friendly and wholesome.
With a small green business, you’re less likely to be deceived, because most of the time they are centered around something that makes a tangible impact.
For example, a recent Honeycomb campaign based out of Cleveland, Better World Refill Shop (now known as Little Spark Refill Shop) is a natural cleaning and health product refill shop. Instead of buying shampoo or hand soap in a plastic container, Little Spark Refill Shop offers them in bulk, and customers can take what they need in reusable containers they bring from home!
Since opening in October of 2020, Little Spark Refill Shop has saved 4,000 containers, which you can see with every customer who comes in for a refill. With their Honeycomb campaign, Little Spark Refill Shop raised $65,590 from 59 investors!
By investing in one small green business, you invest in a community
One reason we love small green businesses at Honeycomb is that they’re all about community building in their neighborhoods, just like us! When you invest in a small green business, you’re supporting many more similar vendors and promoting the notion that green businesses can make a difference and make a profit.
Another current campaign is Harvie Farms, a tech startup that connects consumers to local small farmers through delivery subscriptions.
Harvie is inspired by the idea of CSAs, or Community Supported Agriculture. This is when consumers pre-order a set amount of produce from farmers at the beginning of a season. By offering CSAs, farmers are able to fund the fixed costs of farming - seeds, tools, labor, and also form relationships with the people who are buying their boxes.
Through their delivery box subscriptions, Harvie Farms is sowing the seeds of community throughout each region they distribute by connecting consumers with small farmers they otherwise might not have known about.
Kelsey, an investor in Harvie Farms, says, “I love this service and knowing that I’m supporting local agriculture. I’m excited to see this business grow and am happy to invest in this opportunity!”
We’ve also seen green small businesses become community hubs in their neighborhood by providing healthy, environmentally-friendly spaces for people to hang out.
Botanical Vegan Cafe is a Honeycomb alum that opened shortly before the COVID-19 lockdowns began in Pittsburgh. They needed some working capital, and were able to raise nearly $12,000!
As a green small business, Botanical Vegan Cafe holds true to their values “by incorporating local, non-GMO produce, compostable packaging, and mocktails in a hip bar setting [and] actively normalizing the idea of a healthy, environmentally sustainable, and social-focused environment.”
You know the saying, “If you build it, they will come?” Well, as Botanical Vegan Cafe can attest, starting a green small business allowed them to become a true part of the community by providing a much-needed vegan and climate-conscious environment in their neighborhood.
How to invest in green small businesses
There are many ways you can support green small businesses out there, from posting on your social feed about them to contributing to their growth. Here are a few options you can take to help support your local small green business.
While you might think that investing is only for millionaires and clean energy companies, Honeycomb has opened up investment opportunities for regular people to help support the neighborhood businesses that they love.
For as little as $100, you can invest in a green business like Botanical Vegan Cafe or Compostable LA and help support their growth, while earning a return on your investment!
As we’ve listed above, there are many reasons to invest in green small businesses - they contribute to the circular economy, create a tangible environmental impact, and build community. The final reason is that it’s simple, fast, and a great way of strengthening your ties to the small businesses that make up your neighborhood, while also contributing to your own financial portfolio.
Earn some Green by supporting Green Small Businesses
From compost to acai bowls, green small businesses are creating tangible, environmentally-friendly landscapes in their neighborhoods. Be a part of building more vibrant, financially empowered, and climate-conscious communities by investing in a green small business this Earth Day!
Learn more at www.honeycombcredit.com/invest