Episode 45 Peter Desmond African Circular Economy Network

Interview Transcript

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Catherine Weetman  00:00

Peter Desmond uses his experience from 40 years as a strategic advisor coach, trainer and senior finance executive to support small and medium enterprises and corporates in the UK and Africa and getting started on their circular economy journeys. Peters works as a coach and mentor with government support programmes for entrepreneurs and growing businesses such as such as clean growth UK and business link is a circular economy club mentor, and until recently was local organiser for Brighton and Hove chapter in the UK. Peter is also a chartered accountant and an MBA graduate, which brings a broad commercial perspective to his circular economy work. Peter also has a Master’s in Globalisation, Business and Development from the Institute of Development studies at Sussex University. His dissertation looks at the constraints on recycling mobile phones in the context of moving towards a circular economy in South Africa, enabling him to uncover the ways that circular approaches are better for developing economies. In 2016, Peter returned to South Africa to co found and chair the African Circular Economy Network. This aims to build a restorative economy that creates wellbeing and prosperity for people all across Africa, whilst regenerating environmental resources. The network now has over 100 representatives in 30 countries across Africa. Peter, welcome to the circular economy podcast.

Peter Desmond  01:33

Thank you, Catherine, for inviting me.

Catherine Weetman  01:35

And it’s great to see you (in inverted commas) on Zoom again, and just to explain that we have regular calls, we’ve been working together for a few years, having first met back in 2017, after you contacted me about reading the book, and we got talking about our shared interest in the circular economy. And soon after that decided to start working together, doing workshops, various talks, supporting each other with other projects. And now we’re embarking on some more formal circular coaching programmes. So perhaps we could start with a few quick examples of your experiences circular coaching, because you’ve been doing this for a while.

Peter Desmond  02:21

Yep, absolutely. And, Catherine, I just wanted to make your head even bigger than it already is that the first edition of your book was the best book I’ve ever read on the circular economy. And now having in the process of reading the second edition, it’s still the case, a great range of case studies and explanations of circular business models, particularly in in supply chains, which is why I contacted in the first place. So it’s great to have this chance to explain a bit about my background and some of my experiences.

Catherine Weetman  02:50

Good stuff – but I’m not I’m not quite sure about that head already bigger than it is. Might need to take you up about that afterwards!

Peter Desmond  03:00

No, no, no, I don’t I don’t think you’re a big head at all! So yeah, the the, the the experience I’ve had actually in recent years on coaching businesses in the in the circular economy is actually quite varied. And just three quick examples of of how this has happened. The first one is called SuperLooper. And I met Jenny Barrett in a coffee queue at a Brighton Chamber Conference in 2017. And it was a strange conversation, I said, What do you do? And she said, Well, I sell organic, environmentally friendly baby clothes and children’s wear. And I said to her, have you ever heard of Vigga? Which is a Danish subscription based clothing model for children? And she said, No, I haven’t I said, Well, perhaps you could think about it. And I then went on over the last few years to to help her think about what that might mean for her business. And actually, last month, she launched Superlooper Life, which is an online clothing library of pre-loved baby clothes that parents can rent for last long as they need them before they return them and, and then take out different clothes for different sizes. So that was really a great privilege for me to be able to see a business grow like that a new business model for an existing organisation and I helped to connect, guided her in a strategy, introduce her to possible funders and potential volunteers and clients. So that I think is maybe one element of how circular coaching actually happens, sometimes by chance, but then very deliberate in how you work with people. The second example is called is called Circularity which is a, it’s a new business. It’s a circular approach to making carbonated water. And it’s at the stage of developing the concept from the initial idea and it’s it’s something that it’s still very much in its early days, and I can’t really say too much about it. But the, the aim is to reduce plastic waste to minimise carbon footprint. And we’re in the process of applying to innovate UK for grant funding. And part of my role there was to assist with developing applications for grant funding, but also to support the entrepreneur at funding pitches and look at some of the commercial elements of the project, including finance and risk. And I know that risk is something that’s dear to your heart.

Catherine Weetman  05:36

Absolutely. And just thinking about trying to avoid plastics and not just focus on making plastics recyclable, and, you know, hoping that they get recycled. I’ve just been looking at some stats from the break free Break Free from Plastic campaign, saying that even if companies and governments around the world met all of their circular commitments on plastic packaging, we’d only reduce the amount of plastic ending up in the oceans by 9%. Over the next couple of decades, so we’ve got a long way to go. And I think avoiding the need for plastic in the first place has got to be one of the, you know, the key strategies.

Peter Desmond  06:18

Absolutely, yes. And the third example is of an existing business that I, I helped to help the directors rethink where they were, where they’re going in the longer term. So it’s a it’s a joinery company called Sterling Joinery, and they’re based in London. And they, they have some real ambitions to be more sustainable, and look at circular opportunities for reusing some of the materials and to re manufacture as well as using sustainable wood in some of their some of their products, including growing the wood themselves in a in an East Sussex woodland. So and that really was helping the the directors think through some of their strategies. So that I think people can get involved in circular coaching, lots of different stages of their, the lifecycle of their business. Everybody can benefit from having someone walk alongside them.

Catherine Weetman  07:24

Yeah, I agree. And certainly in my consultancy experiences in the past, just having an outside viewpoint on something can bring up things that that you’ve just almost been blind to it, you know, things have become wallpaper, there might have been problems in the past, you weren’t able to overcome them. And now and now you’ve forgotten all about the fact that it was a problem in the first place. So having that fresh perspective is really useful, I think. So Peter, tell us a bit more about your background and how that’s led to you helping businesses go circular? Yeah,

Peter Desmond  08:01

it builds on something you just said, actually, Catherine about having an external perspective. And my I left University with a doctor degree and I had no idea what I wanted to do. So someone said, become an accountant, which I did. So I’m a chartered accountant. And it’s really never let me down. I haven’t let it go either. And I’ve over the years done some interim finance director roles, which is where an outside perspective and somebody with a different take on the business could be quite quite useful, can be challenging, because nobody likes what you say. But at least you can, you’re able to express your opinion. And so about 30 years ago, I set up my own company growth International, which has been going for about 30 years and probably starting to wind down as I do my 66th birthday next February. But in the meantime, that management consultancy, has been informed by many different things. And a lot of them have happened, not by chance, but by suggestions of other people. So I joined the Royal Society of Arts in 1991. And somebody told me about Tomorrow’s Company, which has continued since then in various different shapes and forms. And so my interest in sustainability and business ethics have really helped me think about environmental and social impacts, which have been very much part of the work that I’ve done. I also ended up as well as a Master’s did some coaching training with Newcastle College. And that also helped me develop some skills about how to help people as they as I move along with them. And what really also informed what I do is is working with them, some government schemes which have, over the years been I think extremely impactful. Sadly, they don’t, they don’t exist in the form they used to so things like trying to gain access to finance Green Growth voucher Vouchers, we now are left with a relatively small of government support programmes, but things like Advanced London and Clean Growth UK, there is still now support for small businesses, often in the green space. And it really was at the end of the day, my master’s at the Institute of Development Studies that got me into the circular economy. My supervisor encouraged me to look at this thing in 2015, which he only just heard about. And so I started researching it. And did a dissertation doing some primary research in South Africa, on the challenges of recycling mobile phones. So yeah, that’s how I got into from an accountant to a circular coach.

Catherine Weetman  10:42

Yes, fascinating journey. And I think your insights in Africa have been really useful to helping helping you and the other members of the African Circular Economy Network, think about the different challenges in a developing economy as opposed to an industrial or even post industrial economy. I’m curious to know a bit more about that. Can you tell us a bit more about some of those challenges and the kind of things that businesses and social enterprises are doing?

Peter Desmond 11:13

Yeah, sure. I’ll come back to the the Africa situation because you, there are some challenges which are not too dissimilar, but being solved in a different, different way. And one of those challenges is funding. And given my my background, it is something which has been of great interest to me to, to see just how circular businesses or business looking to go more circular can actually fund these developments. And so they’re probably for me two different elements. That’s the first one is about small and medium sized enterprise like Sterling Joinery, who, who actually want to be more sustainable. And I mean by that two senses, one about keeping the show on the road, keeping the business moving, but also how they can experiment with circular business models and commercialise those initiatives. And the companies like that, very often, they will have some reserves, cash reserves that can be applied to that research and development. But to be honest, they tend not to last that long. So businesses at that stage would very often look to banks for loans or to venture capitalists for equity. But actually, the banks are not that keen to lend to businesses, even though they’re existing, and they’ve got a track record. Because very often, they’re looking for security, to be put down against the loans. And in my experience, banks do not want to people to mortgage their family home, to put down a security for the business. And equity investors in comparison will also be looking for a very solid business case, and a clear exit strategy. And you don’t have to look at many episodes of Dragon’s Den to really understand what they’re looking for. Yet they do bring different expertise to the party and connections. And yet, sometimes you need creativity in financing and I want to advise the company on on their their business development strategy, who was actually using a rolling approach to funding their business through their personal credit cards by paying one card off for another and for an existing business of several 100,000. That really was a bit of a challenge. Not certainly not something I’d recommend. But it managed to keep them afloat until they could source a bank loan.

Catherine Weetman  13:25

Crikey.

Peter Desmond  13:26

Yeah, it’s it’s unfortunately laughable. But But it is actually true?

Catherine Weetman  13:32

Well, I guess, I guess if times are hard in business, then, you know, business owners will do everything in their power to keep things going, as we’ve seen through the Coronavirus and lockdowns and so on people have had to get creative, haven’t they about either, you know, funding things or reducing costs or pivoting the business and so on.

Peter Desmond  13:55

Now you have absolutely right, and that was the case there definitely they had no other source of, of funding. And and there’s there’s two different things that people need to think about. One is about cash flow, working capital, how they pay creditors and collect debts, but also how they invest for the future. So you might use an overdraft to manage the cash flow. But if you wanted to put research and development effort into developing a new product or new business model, you would probably need longer term funding to be able to do that. And that’s where it becomes more difficult for startups because unless they have their own personal savings, or the Bank of Mum and Dad, then actually it’s, it is a real challenge. We have here, where I live in in West Sussex, somebody who runs a coffee shop has just decided to open up a plastic free shop and empty shop in the village. They’ve taken over and doing that themselves but their parents are the ones who have provided the necessary funding to get it going. And so getting grants, loans that even equity can be considered but accessing those funds is time consuming, you’ve got to be able to take rejection and learn lessons for for the next time you have a crack at it. I don’t think it’s an easy thing to do to look for funding for your business. So at the end of the day, if you haven’t got if you’ve got a good idea, like circuit clarity, it’s possible that you really have to go hell for leather to to apply for like an Innovate UK grant fund. But Circularity Capital and other specialist private equity firms are really looking for something more established. And yet I do here I’m had a conversation the other day with some people from the European Investment Bank, who are actually developing some very innovative ways of funding, circular economy initiatives, both in Europe and in Africa, through methods they call risk sharing. There’s also a new British bank called what’s called the British Business Bank. But that tends to be more focused on traditional SME lending market. But as a way of encouragement, both the Ellen MacArthur Foundation and the European Investment Bank have both recently issued reports on new ideas about funding circular economy initiatives.

Catherine Weetman  16:16

Yeah, I think more more banks are becoming open to it. And there was an interesting podcast from the Ellen MacArthur Foundation, six months or so ago, with an Italian bank, that worked a lot with small businesses, and they really saw secure economies as a way to build resilient, more future fit business models. And were very keen on supporting their customers to get there. And it was an Italian based bank, but they had branches all over the world.

Peter Desmond  16:45

That’s right. There are some Dutch banks that do similar. And we mustn’t forget, because both of us feel strongly about this is that there are other disruptive banks. Now in the UK, including Triodos, an ethical bank, which we both use for our some of our banking, and they have a different approaches to how they invest in more sustainable businesses, and they have crowdfunding platforms. So I think we’ll see the emergence of different banks producing different ways of funding these initiatives, which is very encouraging, even if they are coming from Europe rather than from home grown at the moment.

Catherine Weetman  17:27

Yeah, definitely. And there are also platforms like the Abundance platform, which is helping private, you know, people with a bit of money to put into ISAs or other small scale investments to invest in councils and businesses and social enterprises that are all doing, you know, green energy projects, sustainable housing, and so on. So there are moves in that direction as well. So, so Peter, let’s let’s come back to a bit about the difference between the challenges in in UK in Europe versus versus Africa? What are the similarities and differences?

Peter Desmond  18:09

Well, I suppose that it’s actually pretty straightforward. One is the similarity is getting funding. The differences are, or is the context because our experience in four years of working in Africa, on the circular economy, there have been over generations really different approaches to solving problems like poverty, lack of resources. And when I was last in Johannesburg, you don’t have to walk very far to find the whole street of repair phone repair shops, nothing gets wasted. Because the resources are shortened. It costs money. And so the solution in Africa is to make the most of absolutely every resource that you can possibly find, but also be innovative. And examples of innovation are these are pretty well known. But in Africa, but not necessarily that well known in in Europe or other parts of the global north. In Nigeria, a initiative called Hello Tractor provides tractor services using a sharing platform via text messaging and mobile money, which is quite common. Use of mobile money in Africa is quite common in in two or three countries. Another example is AgriProtein in South Africa, which is a nutrient recycling organic wastes using black soldier fly larvae to produce protein for animal feed. And I heard today that that is now going to be used in other countries across Africa. And finally, Safi Organics in Kenya, where rice waste rice husk is collected from rice farmers and then processed into fertiliser and soil treatments, and then sold back to the same rice farmers. So there are some great examples of circularity actually going on in Africa. And but the context is different and different between countries as well, because the the way that legislation has developed both regulations laws, it varies hugely. And one of our so two prongs of approach that we have in, in the African circuit economy network is to engage with policymakers, and also to create a platform of case studies. And I know that in your book, there are many hundreds of case studies, and we’re looking to put onto a platform case studies that are that show what the problems are, the challenges are in Africa, and how companies have have overcome them. So the African Circular Economy Network is actually a member of the African Circular Economy Alliance, which is a group of policy makers. Across across the continent, so I work is on the ground with entrepreneurs, the the Alliance, they’re working with governments and policymakers. And so working both ends of the spectrum, along with funders, like the African Development Bank, can support these entrepreneurs as they try to develop their business.

Catherine Weetman  21:20

Yeah, I think that’s, that’s really important, also, to emphasise the value of getting all these case studies out into the open, because before you know it, you know, somebody in another country with similar challenges to the country that you’re in, has already solved. One of the problems that you’re looking at, and there are ways of, you know, either sparking ideas or collaborating with people to help spread new technology and, you know, algorithms and artificial intelligence, to help sharing platforms and resource exchanges, and all sorts of other things. So spreading the knowledge of what what’s happening everywhere on the circular economy is that I think is really important. Definitely. And so what’s your top tip, Peter, for anybody wanting to use circular approaches in their business, or to start a circular business from scratch? Well,

Peter Desmond  22:16

unlike most accountants who don’t say very much, when asked questions like that, I do have a number of top tips. And they’re probably nothing new. But I would say, Get Started. If you want to do something, just get going. It’s like writing a dissertation. Just get writing, writing a book I imagine, Catherine!

Catherine Weetman  22:38

Yeah. Abosolutely!

Peter Desmond  22:39

But also, to read a lot about the circular economy. There is a lot out there, quite accessible, it’s not all academic, I’d also suggest people learn from the mistakes of others as best they can. People are also being a lot more honest now about their, what it’s taken to get to where they are, I also find that it’s, it’s, it’s great to, to work and be encouraged by like-minded people who are going to support you rather than put you off. And particularly in the longer term, I think you need to be resilient as an individual. And probably also as a business, if you are, if you’re trying to develop new business models for your own your own company. But I think by doing these, these approaches, you are going to make a difference. And help us all to contribute towards the UN Sustainable Development Goals. and mitigate the negative impacts of climate change, because circular economy definitely has a lot of contribution to make towards those.

Catherine Weetman  23:42

Yeah, definitely. And I think your point about finding like-minded people is is worth restating it’s, you know, the circular economy is still not that well known about. And it’s certainly not that well understood with people thinking it’s mostly about recycling. And so it’s easy to come up against sceptics who tell you that, you know, this isn’t gonna work or customers don’t want this or, you know, business as usual is, is more profitable. So finding people who can help you unlock bits of the business case, and, and as you said, share their learnings, I think is is really important to keep your motivation going and help you come up with, you know, more ideas for how you can make circular work in your business. So Peter, is there is there anybody that you’d recommend for a future podcast or a favourite circular economy example that you’d like to share?

Peter Desmond  24:37

I’ll take that question as an ‘and’ rather than as an ‘or’ there’s me being disruptive. I, I think, very keen to suggest an African example, and one which is part of the circle economy, which is doesn’t get as much airtime as it really needs in the future. And that’s the design element of the circular economy. So there’s a chap I work with who’s based in Kenya, called Wekesa Zablon who runs a company called Circular Design Nairobi. And what they’re doing is working with people to maximise resources, cutting out waste through design. And they look at the whole value chain and try to make structural changes at his design level. And he’s got some very interesting experiences to share. And the ‘and’ is my favourite circular economy example from Africa. I hadn’t heard about this till about six months ago. And that’s fish leather. In Kenya, this is very popular, I didn’t realise that you can tan fish skin. Like, you can cow hide. So what you do, you you set up a workshop next door to a fish factory, you ask them if you can have all their skins, so they’re not going to do anything with and you tan it, and you make it into jackets, hats, shoes, bags, clothes, all those kind of accessories. And amazingly, it doesn’t actually smell a fish. So what you’re doing is using a waste resource to make something usable. So that’s that’s my favourite example of the circular economy in Africa.

Catherine Weetman  26:20

Yeah, and that’s another example of something that could be applied in pretty much every country around the, around the world. And, yeah, I’ve certainly seen salmon leather being used for belts and bags and so on. It’s making use of every single resource that we have, and not letting any part of an animal particularly go to waste is is really important. And how can people find out more and get in touch? If they want to talk to you about the African Circular Economy Network or about coaching Peter?

Peter Desmond  26:57

Well, Africa – the work that we do is, the best way of contacting us is through our website, ACEN dot Africa, A C E N dot Africa. And yeah, so yeah, that’s probably the best way of doing that. And so coaching, well, I suppose it would be RethinkGlobal dot info, wouldn’t it? Catherine?

Catherine Weetman  27:22

Yeah, definitely. So I’ll put, put those links in the in the show notes. And yeah, and you’re on LinkedIn, quite active on LinkedIn sharing circular economy, information on there for UK, Europe, Africa and beyond. Yes. That’s fantastic. Peter, thanks for sharing those. And the Africa example sound really good. I’d certainly like to follow up with a link to Wekesa about his circular design practice. Be interesting to compare what’s happening in Africa with Dan Dicker, from Circular & Co., the design practice in the UK, good to see what what different kind of products are focusing on. So thank you very much.

Peter Desmond  28:05

Thank you for the opportunity to share these thoughts,

Catherine Weetman  28:08

Catherine. Yeah, it’s a pleasure and good to talk to you again, as always, Peter, and talk to you soon.

Peter Desmond  28:13

Okay. Okay.

Catherine Weetman  28:15

Thank you.