Repurposing Capitalism to Scale what Works with Minchan Park of Unreasonable Group

Decarbonizing Commerce

In this episode of Decarbonizing Commerce, host Keith Anderson speaks with Minchan Park, director of portfolio selection at Unreasonable Group, a company helping scale growth stage, impact-driven ventures working on some of the world's biggest problems. They discuss the Unreasonable Fellowship program, the new Unreasonable Food collaboration with Mars, how Min and the team identify and prioritize companies for participation, what the experience is like for the entrepreneurs that are part of the program, and what Min is looking forward to next. Tune in to gather insight from Min’s perspective on these topics and more!

Learn more about Minchan Park:

• Link to Unreasonable's website
• Link to Minchan’s LinkedIn

To listen to the full episode join our Plus or Pro memberships at decarbonize.co:

• https://decarbonize.co/member-benefits/ 👈

Episode resources:

• Unreasonable Food

If you enjoyed this episode then please:

• Follow, rate, and review on Apple Podcasts
• Follow and rate on Spotify
  
  

Learn more about Decarbonizing Commerce at decarbonize.co
TRANSCRIPT BELOW:

Keith Anderson: Welcome to Decarbonizing Commerce, where we explore what's new, interesting, and actionable at the intersection of climate innovation and commerce. I'm your host, Keith Anderson, and together we'll meet entrepreneurs and innovators reinventing retail, e-commerce, and consumer products through the lenses of low carbon and commercial viability.

Welcome to the Decarbonizing Commerce podcast. I'm Keith Anderson. And my guest this week is Minchan Park, director of portfolio selection at Unreasonable Group. Min is responsible for Unreasonable's venture selection process, everything from sourcing to diligence, and of course, selection, helping scale growth stage, impact-driven ventures that are working on some of the world's biggest problems.

Before Unreasonable, Min worked at HG Capital, a leading European private equity fund, and previously was a strategy consultant at OC&C Strategy in London. If you listened to episode 19 of the show with Autumn Fox of Mars, you heard us briefly discuss the Unreasonable Food Program that Mars and Unreasonable Group are launching together.

They've just announced the first cohort of Unreasonable Food fellowships, 15 companies that are going to be participating in the program. And Min and I talked about how the program works, how he and the team identify and prioritize some of the companies that participate, what the experience is like for the entrepreneurs that are part of the program and what he's looking forward to next.

So we get into all that and more, and I'm excited for you to meet Min Park of Unreasonable Group.

Min, thanks for joining the Decarbonizing Commerce podcast. Great to have you with us.

Minchin Park: Hi Keith, thanks for having me on here.

Keith Anderson: We're recording on a Friday, and if I'm not mistaken, you're five or six hours ahead of me, so appreciate you joining me on a Friday afternoon.

Minchin Park: No, this is, this is great. The weather's brilliant in London, for once. It's finally turned a corner, so, you know, happy days. It's a wonderful way to finish off the week.

Keith Anderson: Enjoy it while you can.

Minchin Park: Yeah, it doesn't last very long.

Keith Anderson: No, it often doesn't. Well, I thought maybe a good place to start would be, for those that may not be familiar with Unreasonable Group itself, maybe you can describe what the organization is all about.

Minchin Park: Yeah, happy to do that. I think unreasonable is a pretty unique organization, if I can say that myself. We're not a traditional venture capital firm, which is what a lot of people think we are when, when they come across Unreasonable. We're probably closer to an accelerator, but we still don't use the word accelerator because it's a little bit different still.

I would say at its core, Unreasonable is more of a community. Essentially a community of entrepreneurs, visionaries, capital movers, and corporate partners who all come together essentially to support these entrepreneurs with big visions and are tackling the world's greatest challenges essentially. We, you know, galvanize this community to draw direct and indirect investments into these companies, but we do so much more than just that.

So we provide a lot of the relational support for these founders and to the ventures themselves to help reduce the friction to scale in whichever way possible. And

capital is one obvious friction to scale, of course, that is front of mind for everyone. But there are other frictions to scale for a lot of these founders like, you know, setting up a strategic sales function as the company grows, or setting in place a really strong company culture, navigating, and helping set new regulation standards, or scaling up manufacturing. So, we, we help with all of those things through the network that we provide and the expertise of the people in our community. I would say we are an invite-only community. So we really, we are trying to find the next generation of solutions here today and tomorrow that are making a real dent in the world in solving the world's most intractable challenges.

And once the entrepreneur has been identified and they're brought into the community, we we do everything we can on a personal level for the founders themselves, or professionally, for the venture to support these entrepreneurs to scale faster and further. This fundamentally goes back to the mission and the ethos where unreasonable essentially believes that entrepreneurship is the fastest way to solve planetary scale problems, using the power of capitalism in the right way.

And essentially, you know, by doing this, I guess we're also out to show that, doing well in business and doing good in the world, like, don't really have to be at odds with each other.

If you, if you go to Unreasonable's website, it's, you'll see this simple tagline called Repurpose Capitalism. What we're trying to say here is, you know, capitalism doesn't have to be associated with endless resource extraction or competitive advantage or costs to rise to winner takes all markets.

We're trying to show that you know, the future here, can be one of abundant resources, and abundant outputs, and collaborative advantage. Yeah. So I'll, I'll pause there. And that's a bit about unre, what, what Unreasonable does.

Keith Anderson: I think that's really helpful. Just briefly to play back a little bit of what I heard, some similarities to venture capital firms and to accelerators, but in addition to being a hybrid of both of those models, the invitation-only and sort of selective community component is one of the other things that differentiates you.

Obviously, the mission, very focused on, as you say, planetary scale challenges and backing entrepreneurs and ventures in pursuit of making a dent in those problems. You know, I, I think that's a pretty clear summary.

Minchin Park: Yeah. and then I think the primary focus of Unreasonable is always with the entrepreneurs and the amazing work that they're doing. But if I could add a secondary aim here, it's also about de-siloing the market. So, if you, if you zoom out, there are a lot of different players and entrepreneurs on such a small part of the playing field.

There are investors and capital movers. There are also large institutional players out there. Like some of our corporate partners like Mars, Barclays, who have traditionally been associated with you know, large emission footprints. And in the case of Barclays, you know, funding coal, oil and gas industries.

And so they don't particularly have the best rep, like, in the world. But, you know, these companies won't just go away. As much as the average citizens would love them to, they sort of need a way out, to re-strategize so they can become part of the solution, and certainly they have the size and resources to help the entrepreneurs, so, I guess the secondary mission here is, why not offer them a ledge?

Why not instill this collaborative advantage that I was talking about and create a win/win situation for both the corporates as well as the entrepreneurs? And so I think that's also what we're out to do. So we, we essentially design initiatives, like the one with Barclays or the one with Mars.

And we try to connect them to the entrepreneurs that are really solving these big challenges. And essentially help them help one another. And so, you know, we're not just proving to the world that doing well and doing good can be, done together, we're also proving this to our partners and sort of changing them from the inside.

And yeah, with the goal of repurposingcapitalism. So that's, I guess, a secondary, goal that we have here as well.

Keith Anderson: Well, I'm glad you mentioned some of those programs. As you know, we had Autumn Fox of Mars on the show, a few months ago and one of the things I've been looking forward to is hearing more from you about the Unreasonable Food Program that Unreasonable and Mars have launched together and, also about your role in it.

You know, I, I think it would be great for the audience to understand how a program like that operates and what the objectives are. But then it would be great also to understand a bit more about, you know, how do you approach identifying the right profile of founder or early stage company and then what is participating in the program look like?

Minchin Park: Yeah, yeah, definitely. So we have a partnership with Mars, Mars Snacking, it's called Unreasonable Food, it's a joint initiatives between Unreasonable and Mars. It's our newest partnership, I'd say. And the, and the context for Unreasonable Food really arises from this, like, big problem that I'm sure you and your listeners are pretty, pretty well, well versed in.

You know, 25 percent of the world's food greenhouse gas emissions comes from the way that we produce, process, and package food. That's huge. And if you really think about, you know, the way that we've done this hasn't, it hasn't really changed much in the decades or centuries. It's sort of been efficiency improvements, but as it comes to reducing greenhouse gas emissions, it's sort of been the same old, same old.

And we're not simply going to reduce the amount of food that's being produced given the growing population. So it's a big challenge, but also a huge opportunity at the same time. And so that's the backdrop under which this initiative came about. And I think Mars is such a uniquely positioned player here, to make some drastic changes in the industry, and so not just within their own supply chain, but across, across the board, for a few different reasons.

Especially Mars Snacking, you know, they operate in a more of an impulse category, you know, with their Snickers bars and chocolate bars and sweets, so they have relatively attractive margins, and more importantly, they can have a long term perspective about things because they're a privately owned company, they're probably one of the largest privately owned companies out there, and what's great as well is that Mars is so serious about sustainability.

It's really refreshing from such a big giant corporation to be so serious about it. And you can see that it really stems right from the top. And I say refreshing because there are so many other CPG players and Mars's peers that have made these dramatic pledges, but really have done, haven't really done much to do anything about it.

But when, when you speak to Mars and when you look at, when you unpeel the layers, they on the other hand have made some drastic pledges. So slashing emissions by 50 percent by 2030, net zero by 2050. So this is a big deal if you think about the size of the operations they have. Like you can literally find Snickers bars like anywhere around the world, like, there you go.

So it's pretty huge. But really when you unpeel these layers, you can see that they've made some internal changes, like they're really serious about it. The leadership team, like, is very serious about it. Our, one of our main champions, I think Amanda Davies at Mars, she's the Chief Procurement and Sustainability Officer.

So there's kind of the joint role there. Which sort of shows the dedication and fundamentally just the numbers, they've reduced emissions close to 10 percent to date, they've taken some initiatives within, and also, you know, they've, they've done the steps they can, but this has also led them to realize that they can't do this all alone, they've, they've realized that, you know, to get to net zero, that 2050 goal, they really require technologies that aren't widely available in the market today, so a new way of producing fertilizer or a new form of packaging that is not based on fossil fuels, so they need all of these, which aren't actuallyLJ widely available in the market today.

So they've come to this realization that they can't do this alone. And their organization is structured in a way where they can have a long term perspective on things. So this, this unique backdrop, and kind of context for Mars and Unreasonable to, to work together, it is now really about, can we get the next generation of solutions that are out there, to work with Mars, to help them meet their sustainability goals?

So that's what we're out to achieve. So there's, I guess, two goals here. One is, you know, can we use the resources within Unreasonable, and Mars to help these entrepreneurs scale their impact dramatically? Like I said, these entrepreneurs need all the help that they can get. And that's, a benefit for the world, really, the faster we can scale these solutions.

And the second goal, by doing that, can we then help Mars reach their sustainability goals? And that's pretty evidently clear that they can. It's, I guess the big question is how and how quickly? So the success of this partnership is really around getting all of the people involved to build incredibly strong relational foundations for doing business, and ultimately get them to develop a commercial relationship with one another.

and this is really interesting. This partnership is really unique, because it, it solves from the, it solves from the venture side of point, point of view, this sort of chicken and egg problem that is, that is so pervasive in the venture space. And so, for example, what I mean by that, this chicken and egg problem, say, say a venture with 20 employees, doesn't, you know, has the technology to potentially develop a product that could be used by a CPG giant, but don't want to devote the resource to developing a customized product without some guarantees that that products will be used. Because, you know, devoting, say, six employees onto a new product is a very, quite a risky way to spend your cash. But the CPG player doesn't want to provide a guarantee without seeing the actual product and seeing how it functions. And so it's, if you think about it, it's very, none of these parties want to move first in order for them to not, you know, take a potential hit to their, to, to, to their P&L, and this is a real problem and it kind of stalls and it's one of these frictionsto scale that I mentioned in the beginning, and, you know, or another example might be, it's the more classic one where, a CPG giant won't agree to an offtake because the price is too high for the product that's there.

But the venture really needs the volumes from the offtake to recognize economies of scale to get the prices down. That's, that's a really obvious one that is, so pervasive, not just in the food industry, but across the board when it comes to making things. And so there's a lot of certain frictions to scale. And why this partnership with Mars is so important is because it creates this strong relational background for Mars and our fellows to give that commitment that yes, Mars really needs this.

They think you have a solution to do so. So can we do this? Can we cooperate and not be waiting for the one person to make the full leap before making a decision? Let's sort of meet halfway. So that's sort of the idea around this partnership because, and one way that you can envision how this can speed up the process to scale for some of these ventures.

So that's a bit about the Unreasonable Food Partnership in general. Sorry Keith, yeah.

Keith Anderson: I was going to say, you know, you just announced, I don't know, 10 days ago or so, from when we were recording, the first cohort of ventures in the program. You know, people can go look up all of those just by searching Unreasonable Food. But, you know, maybe it's worth spending a minute or two sharing some examples of the kinds of ventures that were selected and how they align with what Mars is trying to do. And anything we can share about the kinds of criteria that go into identifying and selecting some of these ventures

Minchin Park: Yeah, yeah. This is the fun part. My favorite. So, yeah, like you said, if, there's 15 companies in the year one cohort, that's available in unreasonablefood.com. You can see all the, all the full list of companies. Some that really jump out for Mars and to me as well. So as for example, Seaforest, this is a company, that is cultivating a type of seaweed, this red seaweed called asparagopsis. And this seaweed, essentially, when fed to cows, has the potential to reduce dairy and taric emissions, by 90%. So essentially stops cows burping. And it says up to 90%, but in some cases goes up to 95. So completely gets rid of this methane problem in cows.

And it's so effective, and it only requires a very small amount in the feed. So 0.2 percent of the cow's feed needs to be this additive, to achieve these reductions. So it's a really game changing, technology and product. It doesn't really require any consumer behavior change, which is the beauty of all of this, and passes a pretty minimal premium through on the retail price.

And Seaforest is an Australian company. They've just recently released the first carbon-free dairy milk, in Australia. That was announced pretty recently. That's a big That's a big move. And the potential for this technology is, is tremendous. And there's so many, cows out there in the world today.

The dairy industry is massive. So really the question is around how do we get this production to scale? And how can say a, a company like Mars link Seaforest up with their dairy suppliers to, to sort of feed, almost inset their dairy emissions? And it's one of the biggest challenges, in agriculture today, but also for Mars, as dairy emissions is one of the largest footprints that Mars has.

So that's a really exciting one. There's others like, MycoTechnology in there. It's a, it's an amazing company that's using mushroom fermentation, so, mycelium to create healthy and sustainable ingredients. They make, you know, mycelium-based proteins, but the one that is really exciting, that is coming out is the sweetener product.

They can make a protein-based sweetener that is 1,500 times sweeter than sugar. That doesn't actually get ingested into the bloodstream, so it doesn't affect the glycemic levels in people, so it doesn't actually cause diabetes, despite having the same effect as, as, as a taste profile as sugar.

So this has huge implications for CPG companies that traditionally rely on sugar. And of course, Mars relies a lot on sugar, so this is a big deal for them as well. I think you'll see other companies in there, like 80 Acres Farms, that is more about developing the future supply chain of food.

So, this is more of a futuristic vertical farming technology that can grow crops year-round, superior yield, high quality, with using, using drastically less land, you know, 95 percent less water, 100 percent runs on renewable energy. So it's one of these futuristic, kind of technologies that are in market today. They supply Kroger for tens of million dollars worth of contracts and goods. And it's really healthy. It's non-GMO, pesticide-, herbicide-free. And so that's also really interesting, just the partnership opportunities that are available. So seeing what types of crops that could be grown using vertical farming is also exciting.

Those are just a few names. There's 12 others. I've just listed off three. But yeah, there, there, it's a phenomenal cohort. But how they have been selected, it's a pretty broad criteria. But there's probably four things I would say that we look for in Unreasonable when we think about bringing an entrepreneur into the fellowship. So, first is impact.

I mean, that's a no brainer, right? It has to be core in the business model. We need to be able to see clear, positive, measurable, social or environmental impact. One that is baked into the core business model such that the more revenues they make, the more profits they make, the better it is for the world.

It's that idea around time doing well and doing good together. So we need to be able to see that as more or less a red line. Without that, we won't proceed. Second, we want to see growth-stage companies. One of the reasons why I said Unreasonable is quite different from, say, other ecosystems and accelerators is one of, there's many, but one of the reasons is because we focus on the growth stage, whereas typically these ecosystems like to focus on the earlier stage.

So helping companies go from zero to one, whereas we're helping companies go from one to 10, 10 to a hundred. So we want to see, that. There are companies that are tackling large addressable market sizes, have de-risked the technology, and those are already in market today making revenues, typically in terms of fundraising around series A to series C, if that is, that's relevant, but it's all sort of different.

I think making revenues is probably the biggest, green flag that we look for. So that stage is important. And of course, the differentiation, and the commercial wow factor. So, we want to see a technology or a service that's differentiated versus the status quo of doing things, and also the competition.

So, sort of two things. If it's a new thing in the market, how much of an improvement is it based on how we've been doing it for decades and centuries. Obviously, that'll be huge, but, you know, if there are competitors out there, like, why are they the special one? Of course, it's always really difficult to pick a winner in the venture space, but, we like to have a view on why we think this horse is worth backing.

So, typically, this really involves around being able to show a customer a commercial benefit in adoption, rather than just a sustainability play, so that the scaling this is a no brainer for customers. So if it's helping you reduce cost or reduce energy or it's cheaper than, then of course people are going to adopt it.

It doesn't have to be a thing where you have to persuade them around the impacts of climate change, which I'm sure everyone understands and can in some cases can get behind, but really these are bottom line driven decisions and so to see that commercial benefit is a huge green flag for us. So essentially what we're here to do is to support and scale what and I guess the finally the CEO.

The founder themselves is incredibly important. We... and by that, I think there's a, there's a few layers here. So founder diversity is also really important when we create like a cohort of entrepreneurs. So, we always try to build a community within Unreasonable that's diverse in experience, background and culture.

And we like to support entrepreneurs that really level the playing field for those who might be historically underrepresented in business. So there's a, there's that element, but also just the quality of the human being. And this is more art than science. I wish I had a scorecard for how to judge a person's quality of the human.

But it's to do with their fundamental character. Like we love supporting people who clearly believe in what they are doing, have a deep appreciation for humankind and nature as a whole, show humility, and, but also drive, and are willing to say and admit that they don't know everything, that they need help sometimes, because that's what we're here to do, to help them. So those, I think, four things are things that we particularly look for in a general sense whenever we consider an entrepreneur for the Unreasonable fellowship. But I think for this partnership with Mars, there's a fifth consideration, which is a very important one, which is the fit to their supply chain.

I think because of the context of this partnership and being able to connect them with Mars and helping them work together, we really want to see, companies that can fit nicely within the supply chain, fit nicely into the type of crops that Mars works with, into the type of geographies that Mars works with, works in.

So, Like Seaforest, for example, the company I mentioned earlier, they have a relationship with one of Mars's largest dairy suppliers. So that was always a huge bonus because it just makes the geography footprint. And sort of the relational aspect, much, much easier. And so those things are, I think, important when it comes to this particular initiative,

Keith Anderson: Hey folks, this is the part of the show where we say thank you and see you soon to the general audience, plus and higher tier members of decarbonize.co, stay tuned for the rest of the episode.

Well, you've mentioned, a couple websites, the unreasonablegroup.com site, the Unreasonable Food, website. If folks wanted to get in touch with you, where would you send them?

Minchin Park: Yeah, I mean, I, well, either to my LinkedIn, I'm pretty active there because I'm always reaching out to entrepreneurs that I think are really great, pestering them and getting them to speak to me. Or my, my email, [e-mail]. I think your, listeners are probably a lot of relevant people who would have a lot of interesting things to say and interesting discussions that we could have. So, you know, on email, always welcome as well.

Keith Anderson: Well Min, have fun next month and good luck and thanks so much for joining me.

Minchin Park: Thank you, Keith. This was really fun. Thanks for having me.

Keith Anderson: Thanks for listening. I'm Keith Anderson, the executive producer and host of Decarbonizing Commerce. Sonic Futures handles audio, music, and video production. If you enjoyed the show, we'd really appreciate it if you took a moment to subscribe and leave a review or share it with a colleague. For the full episode and more member exclusive insight and analysis, join the Decarbonizing Commerce community at decarbonize.co. Thanks for listening and we'll see you on the next episode of Decarbonizing Commerce.

Have a question or feedback about Decarbonizing Commerce. Record an audio message https://s.bcast.fm/decarbonizing-commerce?episode=r8kmq678