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Sustainable Online Shopping with Co-Founder David Friedrichs | ProActive Podcast by MeMedia #128


The word “sustainable” gets thrown around a lot in the business world, but what does it really mean? Find out as Cerqular Co-Founder David Friedrichs discusses his groundbreaking business, which aims to follow in the footsteps of Amazon, for good.


Video Transcript:

- [Narrator] Welcome to the Proactive Podcast brought to you by MeMedia.

- G'day world, Chris Hogan coming to you from MeMedia studio here at Burleigh Heads on the Gold Coast, and interviewing remotely, a new friend to the ProActive Podcast, and co-founder of the ethical online marketplace Cerqular, David Friedrichs. How are you David?

- Nice to meet you doing well, awesome.

- Thanks for coming on today mate. And we are in different parts of the country, but I understand Cerqular is actually a global platform and mate, selling sustainable goods worldwide. Tell us a bit more about Cerqular.

- Cerqular is it's our solution to sustainable shoppers who have been struggling to access everything they want sustainably, already vetted, all in one place. As well as for sustainable brands who have been struggling to find a place to sell and shine and compete fairly. So we've married the two up into an ethical marketplace platform where buyers and sellers connect and do what they do best find the world's best sustainable products.

- Fantastic, I do love shopping for sustainable goods myself, and I absolutely know that from a customer's point of view, it always feels like this is a little bit of a barrier to purchasing things because you're not sure about the ethics of the brand or the sustainability of the products. And that requires more research and can hinder the buying process, so if people are simply able to just click, add to cart and buy then I guess this is gonna actually speed up the transaction process and help more ethical brands sell. So but I understand you've got a few products on there. How many are on there today?

- About 42,000, we're growing at a rate of about 500 products a day. So it's going really, really well.

- And you started just late last year, late in 2020 correct?

- November the first, it was probably the worst time to start a business. I don't think anyone plans to join and start a business at that time, especially not just because of COVID, but saying to a brand just before Christmas, Hanukkah, Cyber Monday, Black Friday, all of these massive selling events, hey guys, come and join a new platform. And we started off with two brands and it just went gangbusters from there.

- Amazing, amazing. And where are you finding most of these brands geographically? Are they the world over or is there sort of a central source or a popular source in the world. So Cerqular is based in California in Los Angeles. And so our primary focus at least initially is California. We chose California for a number of reasons. It's a very strong, ethical buying place. The ethos of trying to do better of whether it's health, whether it's new materials, whether it's a way of being, whether it's right through to spirituality, it's a place where we connected with the buying population. So we launched there and that's our primary demographic, California, or the US, Canada. But since November the first, we now have 16 countries under our belt, sellers shipping globally, but we have a presence in 16 countries, which is incredible and it's growing all the time. So we're super proud to say that we have our first Japanese brand that joined, our first Indian brand that joined just in the last few weeks. And this is all in addition to Europe, the US, Canada, Brazil, Argentina, Columbia, Australia. So it's awesome.

- Fantastic, and so what makes a brand sustainable? Like I believe, my interpretation is that, or at least a product sustainable is that it it's vegan but that might be difficult for all brands to do. And maybe there are no alternatives like materials or even transport at the moment, but could you explain a little bit more about the sustainability side of things for these brands?

- Yeah, sustainability is, it's a topic we talk about a lot. You hear sustainability in the media every single day, and people think it's a very easy thing. People think there are lots of different interpretations to it, if I ask anyone in my family they think it's one thing, if I ask you, it's gonna be another thing. And I think that's a good, but it's also a very difficult thing because if we're all trying to come together and make a difference in the world, whether it's to reduce carbon footprint, whether it's to reduce the impact on animals, or even to give people in remote parts of the world, a better standard of living, I think there does need to be some standardised interpretation of what sustainability really means. And in my view, and what I've come to learn from working with brands who know incredible amounts of what sustainability means. It's making small steps to improve in your supply chain essentially. So I don't think it's possible to ever become 100% sustainable, just as it's not possible to become 100% healthy or 100% anything. I think that there is always room for improvement or room for change. And the way we see sustainable as a topic at Cerqular is at least one element that is verifiable as sustainable, and sustainable falls into falls into specific categories. So Cerqular is very different to conventional marketplaces that maybe focus on a certain vertical. So for example, personal care, fashion, or home goods or groceries. Cerqular covers all Amazon categories essentially. So all categories A to Z, and the beauty of that is that for buyers you'll be able to get everything you want all in one place with a single checkout. But it also means that we have to have different sustainable criteria for each different category. So let's just say you're selling a pair of sneakers, Chris. So you've got Chris's sustainable sneakers, so the components that we will look at there will be very different to maybe a product that maybe your friend is selling, it could be a protein shake, it could be a supplement, it could be a home base item. So it really depends. So at this moment, what we're doing is we're really gauging the guidelines of the third-party bodies. So USDA, or Fair Trade or B Corps, or 1% for the Planet, or different bodies who really have a firm understanding of what it means to make incremental steps to improve. And so if someone is claiming that their product is organic or contains organic nature, we go by the third-party bodies that govern those practises, until we have something better in place because these guys have been doing it long enough to know better than what we do. And then we go another step further. So it's very simple for brands who have all the accreditation's, but then you've got an a whole nother subset of brands that may not have the accreditation's for a whole number of reasons. It could be access to finances, it could be they're going down a different route of managing their business. And we love to work with these brands because in many times they actually have something better in place. And so they may work with manufacturers on a deep level to source different types of manufacturing materials. It could be different manufacturing practises, and there are a number of these brands who don't necessarily go down the common route of becoming certified, but they're actually doing a lot more because they are actually governing their whole way of business around doing better beyond just the environment, but also around people and communities, around animals and wildlife, and all of these factors. There are a number of brands doing this, in Austria, Outland Denim, I think is probably one of the best, but it's not just limited to them. There are a huge number of these brands. That's the touch point that I love every day in this business is because unlike a conventional business that may be just want to just earn more revenue and all of those things which is important because the more money a brand can make, the more they can invest in R & D. But one thing that I see in all of these sustainable businesses, is that they have a consciousness and awareness as to doing better, and they're constantly mindful as to how they can improve. So my tip is do what you can with what you have today, and always look for something new tomorrow as to how you can make a small switch, to becoming more consciously aware of how you're doing things. And I think that's the overarching definition of sustainable in my mind, which is just being more aware of what goes into a business and how you can all solve these bigger problems. It could even be how you'd work with your staff members. It could mean what are your end of life solutions? Fine, you've got a great sustainable business, but what happens at the end of the life of your product is just gonna end up in landfill, or do you have a reuse programme in place or an up cycling, whatever it is. So it's a very broad topic. And I think at the moment we're just working on a very detailed level with all brands to make it as simple as possible for them, so that they don't see this as a barrier to entry. We want them to be amplified and to keep growing, and keep doing their thing so that we can be the amplifier behind the scenes, to make them more sustainable over time.

- Fantastic, so where do you see your role in educating brands about sustainability and their options, for example, you've got so many different industries, and so many different verticals on Cerqular, say for example, you're aware of maybe plant-based plastic, packaging that one of those brands is not using, but you have the manufacturer or the source, do you plan to connect these too? Or do you plan to improve the education of the brands on the platform with regards to more sustainable and ethical options?

- Yeah, very much so. So the biggest inhibitor to, I think, accessing sustainable, anything from a buyers and sellers perspective, if you think about it in a realistic level, it's actually accessibility. You may hear about someone promoting a new thing, but how do you buy it? Where do you buy it? For sellers it's exactly the same so if you decided tomorrow to create in a Christmas sustainable sneakers, you may have this grandiose vision of creating an incredible shoe like Veja shoes or Allbirds or whatever it is but.

- Well, I just wanna create straw sandals, like the samurai used to wear mine.

- I love it, awesome. And do you know what the thing is people have, we've actually got this incredible brand about to join they're based in the US and it's a complete Cerqular shoe brand, and so they take all different elements from waste, 100% from waste, and they create these beautiful stylish, sandals and shoes. And you can see their manufacturing process, which includes also a lot of technology but anyway, we connect the dots. So the biggest problem for brands to get started and to become more sustainable is access to whether it's capital, access to resources, to companies. And so Cerqular's mission is on both the buyer and seller side, is to create universal access to the sustainable ecosystem. So beyond being a conventional marketplace platform, Cerqular is a mechanism where buyers and sellers connect, but more importantly, where sellers can access the Cerqular app centre, and have access all in one place, everything they need to build and scale their sustainable business. So what this means is it's plug and play to sustainable textiles already vetted, sustainable packaging, at carbon neutral shipping with Sendell, Sendell has been one of our partners from day one, and we love them. Everything to sustainable fulfilment across the US so whatever a brand needs, we have done the pre-vetting, we've done the pre integrations so that they can access it all from a single place without having to manage the minimum order quantities, without having to go through credit checks, all of those things, it's all in one place, and probably the best example of this is End-of-Life Solutions. So let's go back to the example, you've come out with Chris's sustainable's sandals, what happens two years later on? You're gonna say, great guys, look don't throw them away, give it to my guys and who will up cycle these and they will become a brand new pair, using existing materials, fantastic. The only problem is a lot of these up cycling plants need a minimum tonnage or kilogramme weight to be able to even access it, so again, it's another inhibitor for brands to even become better or do better things, because there are so many limitation factors. So Cerqular has found solutions where even with no minimum order quantities, you can put your sandals at the end of their life, and do something incredible with them, and these could become new sandals, they could become baskets, they could become part of furniture items, but the goal is to make it as simple as possible for brands to do incremental steps to being better.

- Fantastic, my sandal is gonna be compostable you might say.

- Compostable, awesome. I need to send them back.

- Just put them on your garden.

- Awesome, I love it, I love it. So where did this drive come from? we all have a purpose and values that I guess drive our being. And I understand that my values dictate how I function every single day. So what about you, where did your values come from? That drove your interest in creating Cerqular.

- From, I think time at Life Experiences, my wife and I, who's also my co-founder and better half. So we come from a brand building background. So we've had brands ranging from certified organic rainforest alliance, certified coffee, through supplements, through to affiliate businesses, right through to creating formulations within the natural topical care space. And we love the brand building space, we love it. It's actually who we are by nature. And I think when people see a product on the shelf or selling online, they have no comprehension as to the journey it takes to get that product to where it is in your closet, it's an incredible journey. It's it requires so much heartache, stress, money, failures, and all of those problems are further compounded when you wanna make it sustainable at least today. And so when we were going along this journey, we saw firsthand just how many obstacles there were. I always compare the sustainable ecosystem to the conventional is like a highway, so imagine driving down a highway and you've got the sustainable versus the conventional, the conventional is just free flowing, there's no traffic, there are no detours, you can access any number of exits and it'll all take you to the end destination. Within the sustainable one, there are so many detours, there are so many obstructions, there are so many things that will just stop you from getting to your end destination. And sometimes people give up because of those things. And it's usually not because of willpower. It's usually because of time, it's usually because of money and access to the things to get them to the next milestone. And when we moved on from our last business, we wanted to do something that had the impact of many. Our ultimate goal was to always create something that had genuine value, but I knew that whatever we created, would only have enough value within our small ecosystem, maybe our buying base or our manufacturing community or whatever it was. And so we had this thought process one day, what if we were the impact of 1000, 10,000, 100,000, 1,000,000, brands all collectively working together to do better things. We could have a tremendous impact on a single platform to actually change supply chains from conventional to sustainable, and it's not just sustainable I think ultimately we're moving towards a more Cerqular way of being which eliminates waste, and probably the biggest problem we have in today's society is waste. Where we produce so much waste that we have no idea what to do with it except putting it in landfill, and our oceans and all of these things. And so Cerqular's overarching mission is to make it so cool, so fun, so easy to buy and sell all the things you want to buy and sell, so that eventually it becomes the new shopping and selling norm that just changes supply chain, right from the very inception, everything, how you produce, sell, manufacture, transport, will then transition into a more sustainable model. And I think if you can imagine the flow and effect of this, it's not just the environment that will win, but it's everything from people and communities,. A sustainable product usually comes with fair working practises. A sustainable product usually has less impact on animals and wildlife. The other thing is that it also helps people selling the brands as well because you're usually selling a product at its fair price, not at a price that it always blows my mind when I go into, I won't mention any brands, but when I go into one of the mass retailing brands and you buy a t-shirt, and you often think, how can this t-shirt cost $10? This company is paying so much in rent. This product is needed to be shipped. It's needed to be manufactured, and yet it's costing $10, it's impossible. Somewhere along the line, people have had to suffer in some shape or form to get this product to where it is. And ultimately we want to change this with Cerqular, so that if you have a brand to create a sustainable sandal, and you know what's gonna cost the fair price, well, we will connect you with shoppers who are not only willing, but who wants to pay their fair price, and who really want to shine and make a difference through their purchases. And that's what Cerqular is all about to do.

- Fantastic, so just going back to those value sets, who inspired you with your values, your life values, your personal values, do you think? Who was it in your life maybe during your upbringing or were they a family member, a school teacher, or someone, or was it a celebrity?

- It's interesting, I'm from a generation where my family, I think they just have to work really hard to make ends meet. And what that meant is I don't think the word sustainable ever crossed anyone's mouths at all. And it wasn't because of ignorance or willful blindness. It just wasn't a consideration, but my wife and I, we became front and centre in this, when we were facing the option of every time choosing manufacturing pieces for our packaging, or for ingredient lists, when we were producing our products. And manufacturers still, up until a few years ago when we were doing this would always promote the cheapest and the least sustainable options, because they to get the sale across the line. And so it was almost like, it's almost like a drug where you just wanna get something across the line rather than actually making a shift to something positive. And there were always these influencing factors and unbeknown to us at the time, you saw Apple, I love the innovation behind what Steve Jobs did. And I think it's changed a little bit since then, but I was a huge, I still am a huge Steve Jobs fan, of doing things before they even existed in a better way, for their better user experience. Even Amazon, even though Amazon is a huge contributor to waste, I think what Bezos and the team have done is really introduced a shopping model that has shown the world that there is a new way to buy and sell. And now I think we've got the chance of actually taking that model and improving it yet again, to making it more sustainable, making it something that can actually last not 10, 20 years, but maybe the next 100 years, because we're having low to even no impact on the environment. So I'm getting a lot of influences from a lot of people. And without a doubt, I think all the people in my life have helped shape everything that Cerqular is today. But the biggest influencing factors that we learn from every day are the brands, these people have usually sidetracked or left a career behind, to go into a field where maybe they weren't an expert in, but because they just couldn't find it in their day-to-day lives. Whether it's a shoe product, whether it's something for their children, whether it's an arts and crafts, whatever it is, A recent story, this Japanese brand joined Cerqular called Kapok Knot, and it's such an incredible company. They produce materials out of the Kapok plant and up until meeting these guys and language is often a slight problem. The language became so unimportant because we communicated through a similar mission of just creating things through innovation.

- What is Kapok? Is it a?

- It's a plant that grows well, it's like a fruit that grows in Indonesia. So it's about so big and inside it's contains a material like fabric that is then weaved and made into a fabric that produces the same wind heat protection essentially, that I think puffer jacket does, but with one fifth that is required and it's 100% renewable, it has no impact on the environment. It gives people tremendous jobs, but more importantly, it can be reused in bedding, into, sofas, into anything you want, essentially. And it's completely natural, so it's not filled with microfibers that will end up in the landfill or with plastics and all of these things. And so when you speak to these people from different parts of the world, it's so inspiring because you realise that you're doing this platform for them, to get their voice out to the market, and for people to enjoy these super cool products. I mean, who doesn't wanna wear a Kapok jacket and just have it as a talking point over a beer, I mean, it's incredible.

- It's absolutely nice, I love it, I love it. On the same, I wear Outland Denim regularly, I'm wearing it again today. And I always find it difficult to buy another jacket or something along those lines that is sustainably sourced or, or even vegan. And it sounds like the Kapok fruit, I guess it is. Would be a fantastic alternative and absolutely, yeah, a talking point. Also, I believe there's other materials out there, that are new and emerging and certainly beginning to make a decent impact on the fashion industry, and I believe there's a cactus leather.

- Yeah, yeah. So we've got a Denver brands actually coming out with, so we have this really cool Canadian brand and Poppy Barley. And so this young female entrepreneurs, she's got an incredible sight. Everything is just beautiful and it's all through incredible innovation. So anyway, she produces these shoes out of cactus leather, made in Mexico, and it's made in a place where literally the entire village gathers together to produce materials. So you've got one person who manages the crops, one person who manages the manufacturing then. And so it's everything into when that actually helps not only create a sustainable product, but changes a whole community, gives them a whole mission, educates them into a way of a business structure that has longevity in it. And so the material, the end material that you will feel is identical to leather. You'll have no comprehension that it's a natural product and it can constantly be renewed. So it can be reused in so many different forms, whether a new shoe, it could be a handbag, it could be a wallet, it could be a belt. And that's what we love about it. It's made through innovation and yet still gives us the same, the components that we like of leather. When people say, sustainable products are great, but are they as comfortable? Are they going to last as long as a conventional product? I think we're now through technology, getting to a place where you're getting exactly what you want, without the impact of whether it's the environment and all of these things, fine you're still gonna have to pay a small amount extra, but ultimately that little bit extra is actually the fair price, where it's actually helping people on the way to give you more products that will eventually drive prices down. So we just have be a little bit more tolerant to these things in the short term. And I think help these companies do what they do best.

- Absolutely, absolutely. I'm still waiting for mushroom leather to really make an impact. And I know that there's some companies that have made certain garments. And in fact, I've got a local brand that I really want them to switch their leather manufacturing to something like like mushroom leather, but maybe the cactus leather is a go. Fantastic, and I know I'm not alone here, like the vegan food movement was like the biggest of its time and it's certainly not stopping, and I'm not talking about the political side of vegan so much, I'm talking about people improving themselves through food plant based nutrition, and improving their performance. And what happens when you adopt that lifestyle, is you start to open your mind to other ways you can consume, without being a burden on the planet. And you just naturally want to go, well, look, if I can do this with plants, then why can't I do it with the clothing I wear, or the furniture in my house and so on and so forth. We're looking at sustainable power options in the world, like there's so many areas for improvement. And I just love that that Cerqular is promoting that. I love that you're gonna constantly be improving yourself 'cause as time goes by, there'll be probably new distribution channels or new brands that are more local, to certain buyers, et cetera. And it'll just be this constant push to just get better, and people will vote with their wallets, and therefore it is either commercial, it's not just altruistic.

- I agree, I agree.

- Yeah, so I believe we're in an exciting time. It's really great that so many people around the world are thinking outside of the box, and innovating in this way, and hats off to you for facilitating that seller and buyer connection, and just making it a little bit easier for people to choose.

- That's awesome, I mean, we're the blessed ones who get to do this, and the vegan analogy is a good one. My wife and I we're vegan as well. I was actually raised on a vegetarian diet from the get-go. But it was for very different reasons, like I said, it wasn't for sustainable reasons, it was for whatever reasons mine my mom had in mind. And when we made the switch to become vegan, we did it for reasons after looking into what our consumption habit, what our consumption had on the environment and on animals, we're huge animal lovers. And initially, yeah, we missed a few things. We did enjoy cheese and all of those things, but the thing is now, this is across the board, whether it's fashion, whether it's cars, there are sustainable alternatives that are equally as good, or they're becoming better. And to the point where we not only don't even think about it anymore, it's almost to the point where we are educating ourselves to become even more mindful of what our purchases are, whether it's grocery products, whether it's remembering to take shopping bags, all of these things. And I think the more you support a brand that is doing something different, and taking the leap to become more sustainable, the more they will develop it to make it taste better. Initially when vegan products came out, they didn't taste the best in my view. And now they're becoming really great, and it's because your shopping dollars actually help them invest more in the R & D to improve their products. And so I think in 10, 20 years, I think anyone who hasn't caught on to this movement, will be left behind. And that's inevitable.

- Fantastic, David, thank you so much for your time. Cerqular is live, and could you just spell that for us please?

- Absolutely, so C-E-R-Q-U-L-A-R. So it's a spin on the Cerqular economy.

- Great, .com, it is live, people can shop and support those brands that are trying to be more ethical, more sustainable in our world. And I really take my hat off to you and your co-founder wife, better half.

- It's just a better half definitely. She reminds me of it every day. By the way, the prices on Cerqular the same as on the own side as well, we want this to be a real fair shopping experience, so go for it.

- Excellent, and how do people stay across what what's Cerqular up to? Is there a blog, newsletter, social channels?

- Yeah, so we're on all the social channels, Insta is Cerqular.USA, LinkedIn obviously, and sign up also on Cerqular for our blog as well. So Cerqular, we don't just share information about us, we share information and the stories behind the brands on Cerqular, which is a real cool stuff.

- Fantastic, thanks very much for watching everybody. It's been a absolute wild ride here doing the Proactive Podcast I get to meet great people, just like David. And it's all inspired from basically me wanting to create and build brands on purpose. I've written a book called, "Building Brands on Purpose". It is almost out on Amazon, and you can watch the Proactive Podcasts and everybody on it on Apple, Spotify and YouTube. Take care, much love to you all and be well.

- Cool, thanks very much.

- Cheers.

- Cheers.



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