The world's oceans provide us with food, produce oxygen, absorb heat, influence our weather and climate, provide us with recreation opportunities, as well as a mode of transportation. However, the oceans are in peril and need our help, but a lot of money is needed to fix them. A recent study estimated that it will cost US$174.52 billion per year over the next seven years to save our oceans and attain the goals outline in the United Nation's SDG 14, Life Below Water.
While key players such as governmental agencies, non-governmental organizations, development banks, and philanthropists are doing their bit, funding continues to be a challenge. Yet, while these investment channels are important, one way to address the shortfall is by driving market-based opportunities in the blue economy that provide investors with a healthy return on their investment with no expected yield sacrifice, while also offering benefits to society.
The blue economy is any economic activity associated with water, including fisheries, aquaculture, kelp and seaweed farming, renewable energy, sailing and water sports, and tourism, to name a few. It also includes blue technology, where innovative ocean-based solutions are developed to address some of the challenges faced by the blue economy, the oceans, climate change, etc. The market for these technologies is expanding, spurring new ocean-based startups and piquing investor interest. By attracting outside investment in the blue economy, new sources of capital are drawn into the funding pool.
Investing in Market-Based Ocean Startups
The list of innovative ocean-based solutions is steadily growing, but instead of going it alone, entrepreneurs are turning to partnerships and collaborations to help scale-up their innovations and expand their business. For example, the Iceland Ocean Cluster (Sjavarklasinn) is a start-up network consisting of environmental entrepreneurs working across several industries who focus on inventive andcreative technologies that address climate change and sustainability issues.
On the other hand, investment hubs such as Investible Oceans, provide a platform to bring market-based capital to ocean startups, allowing investors to explore investment opportunities across a wide range of sectors in the blue economy.
1000 Ocean Startups is a coalition whose goal is to accelerate ocean impact innovation by supporting startups. Their objective is to scale up at least 1000 transformative startups by 2030 in an effort to restore ocean health and achieve SDG14. 1000 Ocean Startups recently launched the Ocean Impact Navigator, an open source Impact Measurement Framework for the Ocean Impact Innovation ecosystem. This tool allows ocean innovators and their financial backers to measure their impact across six impact areas: Sustainably Managed Ocean Resources; A Clean Ocean; Thriving and Restored Marine Habitats; Towards a 1,5°C World; Resilient Coastal Communities; and Positive Socio-Economic Outcomes.
The Blue Venture Forum is a program that connects existing blue technology companies, investors, and resource providers with emerging blue technology startups. This forum helps companies identify new ocean-based technologies to partner with or acquire, helps scale-up startups by connecting them with funding and resource partners, helps investors find blue technology startups to back, and provides startups with mentorship.
How to Speed Up Sustainable Ocean Investing
There is growing interest in sustainable ocean investing. Ocean-based products and solutions are mushrooming, and starting to attract investors. As investors start to acknowledge the role the oceans play in climate change, this is likely to start attracting interest from existing climate investors too. While the proliferation of ocean-based solutions is great, in order to build credibility in the ocean investment sector, it's important to have a sound framework, together with robust tools that can monitor and measure the true impact of a ocean-based product or solution.
Sources:
https://www.weforum.org/agenda/2022/09/sustainable-ocean-investing-goes-mainstream/
