Startup Series: Shellworks

Oct 6

Today’s guest is Insiya Jafferjee, CEO ad Co-Founder of Shellworks.

When we talk about excellence in packaging today, we typically think of companies who create an elegant and exciting unboxing experience. Think Apple. But as sustainability continues to gain awareness in the popular conscience, how far away are we from celebrating companies who create small footprints from their packaging? How do you celebrate something if the goal is for it not to be noticeable in the first place?

Shellworks is developing sustainable packaging alternatives to plastic that don't compromise on performance or aesthetic. Based in the UK, the company recently raised a seed round of funding to help them scale their micro based mono-material packaging via cosmetics companies that are looking for natural packaging alternatives. Insiya brings a no-compromises spirit to what she's doing at Shellworks. She believes her company can develop packaging that has minimal footprint and is stunning and brand-forward.

In this conversation, Cody and Insiya cover her background, the state of plastic packaging today, how Shellworks came to be, their initial approach to product development, current product lines and traction, and how their non-compromising culture turns internal innovations into a robust product pipeline.

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Episode recorded on August 31, 2022.

In this episode, we cover:

[2:38] Insiya's background and climate journey
[8:15] The world of packaging and different types of plastics involved
[14:04] Industrial shift away from plastic packaging
[18:03] Challenges to addressing packaging in cosmetics
[19:46] Shellworks' go-to-market strategy
[24:33] An overview of Shellworks and their focus on mono-material products
[27:27] The company's commercial traction
[29:47] Use cases that aren't a good fit for Shellworks' offerings
[36:53] The company's core value ads
[41:44] What's next for Shellworks
[45:20] Funding to date, early challenges and how Insiya overcame them

Jason Jacobs (00:01):
Hello, everyone. This is Jason Jacobs.
Cody Simms (00:04):
And I'm Cody Simms.
Jason Jacobs (00:05):
And welcome to My Climate Journey. This show is a growing body of knowledge focused on climate change and potential solutions.
Cody Simms (00:15):
In this podcast, we traverse disciplines, industries, and opinions to better understand and make sense of the formidable problem of climate change and all the ways people like you and I can help.
Jason Jacobs (00:26):
We appreciate you tuning in, sharing this episode, and if you feel like it, leaving us a review to help more people find out about us so they can figure out where they fit in addressing the problem of climate change.
Cody Simms (00:40):
Today's guest is Insiya Jafferjee, co-founder and CEO of Shellworks, which is developing sustainable packaging alternatives to plastic that don't compromise on performance or aesthetic. Based in the UK, Shellworks recently raised a seed round of funding to help them scale their micro based mono-material packaging, via cosmetics companies that are looking for natural packaging alternatives to plastic. A big aha I had during this conversation, is that when we talk about excellence in packaging today, we mostly think about companies who create an elegant and exciting open box experience. I usually think of apple as the gold standard here. But as sustainability continues to gain awareness in the popular conscience, how far away are we from celebrating companies who create small footprints from their packaging, and how do you celebrate something, if the goal is for it to not be noticeable in the first place?
Cody Simms (01:30):
This is sort of the ultimate challenge with climate and sustainability. If success is positioned as avoiding the worst effects, it can be really hard to gauge success because we don't know what the worst effects are. I was inspired by my conversation with Insiya because she clearly brings a no-compromises spirit to what she's doing. She believes that Shellworks can develop packaging that has minimal footprint and is stunning and brand-forward. She and I talked about her background, the state of plastic packaging today, how Shellworks came to be, their initial approach to product development, current product lines and traction, and how their non-compromising culture turns internal innovations into a robust product pipeline. Insiya, welcome to the show.
Insiya Jafferjee (02:15):
Thank you. I'm excited to be here.
Cody Simms (02:17):
Well, I'm really excited today to dive into the world of packaging, which is ubiquitous and all around us. And you all are trying to obviously do something quite different in that space. But maybe before we do, let's dive into your background. So share with us how you came to be focused in this and kind of what your journey looked like along the way.
Insiya Jafferjee (02:38):
So I'm Indian. I'm originally from Sri Lanka actually. So I grew up there, and then was fortunate enough to get into Stanford. So that's when I first made my way out into the Bay Area. And I guess I fell in love with making... Stanford has this amazing machine shop, which even as a freshman, you can kind of go in and use all the machines. And I think that was my introduction into physical products, how you work with them, how you make them. At the time, I wanted to learn how things were done really on a mass scale. So I went and worked at a very big consumer product firms like Bose for a little bit, I've done Ford for a little bit, and then Apple, where I think you can really, really get to see the scale at which things are made. But I think there was only so much of optimizing watches I could get behind after some time. And I just felt like I wanted to do something new, but I didn't really understand what.
Insiya Jafferjee (03:40):
And so I came out to London to do my master's, and that's when I met my co-founder, Amir, who had a love for natural materials, to be honest. So when I met him, he was making a chair out of slime, and he was known in the department of doing, he was the mushroom guy, because he had been experimenting with mycelium before it was cool to experiment with mycelium. And I think his love for natural materials and my desire to make an impact kind of blended into, "Hey, let's try and get rid of plastics."
Cody Simms (04:13):
Well, so much to dive into there. I first have to ask, so I have visited Sri Lanka once, it's an unbelievably beautiful country. You must have grown up during the civil war, I'm guessing. Is that true?
Insiya Jafferjee (04:25):
Yeah. We did grow up during the civil war. It's an interesting one, because I think as a kid, you don't really know the impacts of what it means until you're an adult. And so I think actually me and my friends have more recently been unpacking what it meant, because sometimes, you go for a cricket match and then you're like, "Oh, actually we need to go home because there're shells in the sky." And you're like, "Okay, that's cool. I get to go to my friend's house," but you're a kid. But for the most part, I grew up in the main city. So I was sheltered from it. But I think it feels like now is a time when Sri Lanka is actually having some more discussion around it and resolution around it. So it's kind of nice to see that that conversation is starting.
Cody Simms (05:07):
Awesome. Yeah, thanks. So sorry I did a non-sequitur there, but it just felt like an incredibly interesting, and I assume very shaping part of your being, having lived through that.
Insiya Jafferjee (05:18):
Yeah. It's something subconsciously I guess a lot of us in our generation now kind of reconcile of perhaps how we ended up where we are, our mentality to just being a bit more appreciative to your lives and what you can do and what kinds of impacts you can make.
Cody Simms (05:35):
And I'm curious, living in such different environments from Sri Lanka to San Francisco Bay Area, to London, how much that also impacted your desire to work in sustainability and climate change; different observations you may have had about different parts of the world and how people consume things in different ways, anything there that also helped you tip the scales toward wanting to work on these projects?
Insiya Jafferjee (05:59):
I think it's twofold. I think living in different countries gives you very different perspectives. So I think, for example, in simple things like in Sri Lanka, I think one of my most vivid memories is that you don't have the ability to think about waste because there are so many other problems, like your access to food, like your basic necessities. And then you go and live in California, Stanford, where every piece of packaging is recycled quite effectively, or effectively in the sense that people have the care to be able to think about it and put effort into that.
Insiya Jafferjee (06:35):
And then London, which is a little bit of an in-between place because it's a very concentrated city with so many different cultures, I think the place, when I think I really started the jarring contrast, I think between the US and Sri Lanka was maybe where I first got instigated, because at Stanford, they inspire you with this confidence that you can really do anything. And then in Sri Lanka, it's a little bit of a helplessness. And I think for me, I kind of developed a bit of a persevering nature, because I was so helpless before. But then I was inspired by the fact that I could do something about these things, and London felt like the right place to do it somehow.
Cody Simms (07:19):
Yeah. Well, let's dive in then, and talk a bit about the landscape that you decided to focus on. So before we even dive into Shellworks and your product lines, I'd love to understand the world of packaging today. From where I sit, obviously so much of what we package things in, are made of plastic. But when I stop and think about it, there are so many different types of plastics that are solving different use cases, from food freshness to durability of products, to things that need to be clear so that you can see what's in the product, in the box or package, to things that need to be colored to match the branding of whatever company is trying to sell a thing to you. And I'm sure there are multiple use cases beyond that. So maybe walk us through the world of packaging as it exists, and sort of different types of plastics that are involved when we think broadly about the category of packaging.
Insiya Jafferjee (08:15):
Yeah. I think it's a really great observation, because often we think of plastics as one category, but the reality is plastics is actually many materials. And that's partially why you have a problem with managing it. Because in reality, glass is a little bit easier because generally there's one type of glass. But in plastics, there are so many. And in packaging in particular, there was this instinct in order to preserve ingredients, which was our overall goal. But even today, I think one of our principles, which is a difficult principle, is how do you create mono-material packaging? Because most packaging is multiple layers of plastic, exactly for the reason that you highlighted, its ingredients and shelf life and the ability for people to sell through retailers that creates this need for high performance packaging, which requires more than one type of material at the end of the day.
Insiya Jafferjee (09:18):
And a great example is we've been tackling cosmetic ingredients, which with the best of their intention, have been trying to move to natural ingredients. But then the trouble with natural ingredients is that they're very active and they have a shorter shelf life, and so they require maybe more problematic types of packaging.
Cody Simms (09:38):
Something you said just sparked a thought for me, which is, as more and more retail purchasing is moving to e-commerce, one would think that that could enable a different type of package because all of a sudden, you don't need something to look great on a shelf somewhere. But I don't know that we've necessarily seen that. It feels like things are just taken in the package that was designed for Walmart and then thrown in a box and shipped somewhere as opposed to completely rethinking the packaging for e-commerce supply chains. Is that accurate or is that starting to change?
Insiya Jafferjee (10:11):
So I think it's not something that necessarily people think about in their first instinct, but it's where we believe that education can play a really large role. So some of the things that I feel like were done really successful, was Tetra Pak created a type of packaging that was really critical towards safety and shelf stability and shipping. So they had a very cool unique proposition, but then they offered a square piece of packaging, and everyone was like, "You know what? I'm going to go for this square piece of packaging and figure out how to make it my own through just printing."
Cody Simms (10:50):
Maybe for people who don't know, explain Tetra Pak for folks.
Insiya Jafferjee (10:53):
Oh yeah. Tetra Pak, the easiest way to describe it is probably if you've ever bought a milk cotton that's square shaped or a juice box that's square shaped, it's most likely created by Tetra Pak. It's one of the largest packaging companies in the world. And it's something that we as consumers probably don't recognize, but they've managed to actually simplify in one way, versus other packaging in the world still has unique forms, unique types of materials. Everyone's trying to get a sense of... And it's natural. You want to distinguish your brand. And like you said, on a shelf, that makes a huge difference to how well your brand will perform. But I think there is real value in that simplicity, that Tetra Pak was able to bring, because by doing a single form factor, you are actually able to streamline and simplify. And it's like the fundamental principle of sustainability is less is more, honestly. So you're not adding so many different variables that make it complicated. But I think that's not something that's, at first obvious, and you kind of need to start telling that story a bit more.
Cody Simms (12:05):
Yeah. And so do you see that with e-commerce, all of a sudden, people are starting to be able to package product in a way that doesn't require that brand pop to the package or is that not happening yet?
Insiya Jafferjee (12:17):
It's not happening yet in part because of the revival of retail. So I think e-commerce... And it's interesting, because when we speak to brands now, there is an element of they'll be like, "Oh, actually e-commerce is a good place to start with because it doesn't have to have such a long shelf life. It could be somewhere where you can start to take more risk," but then ultimately, they still end up having to go into retail and then it's a question of how do you create something that is tied and how could a consumer recognize the brand, and you can't be too different, unfortunately. So the challenge still exists. But I would say that more people are embracing this narrative that if I'm truly sustainable, I'm truly sustainable, and this is what I'm going to offer and push consumers into. But then at the same time, some people are still, it hasn't really caught on yet for people to build confidence that if they do the same, they'll still be successful.
Cody Simms (13:22):
I want to look at, moving even away from plastics, looking at something like styrofoam, which I think there was a very successful campaign, a decade or two ago, to some extent, shame companies that were using styrofoam packaging. And most companies moved away from it. You think of fast food for example, that had styrofoam cups, most have moved to more paper based product cups. I don't know if they're actually using better materials, but they're not styrofoam. Do you see the same thing happening with plastics over the next decade, which is there will be, to some extent, companies realizing that they are actually hurting their brand by continuing to use single use plastics?
Insiya Jafferjee (14:04):
Almost definitely, because it has such a negative reaction for consumer now when they see it, especially when they see overpackaging. It's like your natural reaction like, "Why did I need to get three boxes for me to have this product?" And I think what makes it easier is once one brand has done it, then another brand has confidence to follow. And then the others are like, "Oh, I really need to do it because everyone else has been able to do it." So I think in part, we found one of the core reasons is there's a huge desire, but there hasn't been an alternative that requires a company... Usually alternatives have required a company to compromise. So how do you create an ethos that you're not compromising, you're gaining, but let's look at it in a different perspective now.
Cody Simms (14:59):
When we think of good packaging, quote unquote "good," today we mostly think about beautiful design. I think of good packaging, I think of Apple almost automatically. As that mind shift changes, and good packaging becomes still great design, but also sustainability and reuse and biodegradability, who are leaders today? If I were to think of good packaging in that regard, who are the leaders today that are doing a wonderful job with packaging and not creating a huge footprint around their product?
Insiya Jafferjee (15:35):
It's a tough one because outside of those who can rely on paper packaging, I don't really have someone who comes to mind, to be completely honest. And it's something that one of our founding principles is that we have to offer something that's sustainable performant and cost competitive. And for us, performance means both functionality and as well as aesthetic. But yeah, I don't think I can put my finger on a brand and be like, "I'm really inspired by a big brand who's done it." It's easier for some industries than others, to be honest. If you can leverage more cardboard packaging and make that beautiful, then yes, that's amazing. But for those who can't, I don't think there are many options.
Cody Simms (16:23):
That sounds like a good opportunity for you.
Insiya Jafferjee (16:27):
Yeah. I was going to say the brand we just worked with, but I felt like that was a little bit too much.
Cody Simms (16:33):
Well, we'll get to that as we start to talk about your attraction, but that's great. I do want to hear how people are using your product. But that's very jarring to hear that no big brands yet stand out. For anyone here who runs award shows on packaging or whatever, let's change the narrative from like, "Oh, how great this is designed and how it makes me love the brand," to, "Wow, we're using product the right way." My goodness, it sounds like we're ready for a whole industrial shift on how we think about this thing.
Insiya Jafferjee (17:04):
Yeah. It's wild. And when you think about it at that scale, and especially when you think about, one, the size of the markets and the volume of the problem, but equally, it's an interesting one because it does require just a little disruption, and then I think it will have a ripple on effect.
Cody Simms (17:24):
Well, hopefully we start to see the design magazines and whatnot create the right carrots and incentives by rewarding the right thinkers going forward. Let's all make that happen shall we. So let's talk about cosmetics in particular, because I know that's been an area of focus. It sounds like you said one of the big challenges in the cosmetic space is the movement of most of these brands to more natural ingredients that have shorter shelf lives than things that have high preservatives and artificial ingredients in them. What else? What are the issues with the cosmetics packaging status quo, and where are you seeing there being a big opportunity?
Insiya Jafferjee (18:03):
So I think the main aspect of cosmetics is that it's a little bit like a product. So it is a bit more complicated than your standard piece of packaging, because it has multiple components. So if you think about a pump, it's actually made out of seven different materials in most instances, or a lipstick has five different types of plastics. So these are products that cannot be recycled. And I think fundamentally, then you start to ask the question well what can you do? You have to use an alternative material. And I think that is probably the hardest part about packaging for cosmetics, is the fact that every product is multi-material.
Cody Simms (18:46):
Just to make sure I understand, they can't be recycled because they're too complicated mechanically that a recycling facility would have to actually disassemble them in order to recycle them, and no recycling facility has the bandwidth or capacity to do that. Is that correct?
Insiya Jafferjee (19:01):
Yeah. Yeah. So if you think about a lipstick, the outside of the bottom material are two, then usually they have an aluminum canister. And then the bit that swivels up and down is polypropylene, and then there's actually another bit that sometimes is a different material as well. So it is one of those things that at scale, it's quite challenging. Also, lipstick is often small, so it falls through the grates at most recycling centers. And this is quite common for most cosmetic packaging, is that it requires multiple different types of materials that often require different types of end-of-life.
Cody Simms (19:35):
That sounds like a really complicated starting point for you in terms of a business. We're going to get into everything about your company, but how did that become your primary go-to market?
Insiya Jafferjee (19:47):
So we also are designers at heart. So we care about aesthetics and color and beauty and all of the other aspects that I think maybe another packaging company that might not come as easily, or it might not be as much of an interest point. So for us, we really cared about this. I think the second was, it felt like the market was really ready. When we approach customers... And I think the third for us was we were a business that didn't want to pilot. And that was a very strong decision we made is we don't want to do a pilot because a pilot doesn't mean that the product is going to get adopted at scale. But you have to pilot with food companies, because they need like 10 million. But in cosmetics, they can sell 1,000 or 10,000 and still be a remarkable brand. And so that was the main instigator for us to pick cosmetics, is that we didn't need to pilot. We could just sell and then we could get consumer feedback and then we could iterate and test and try again.
Cody Simms (20:49):
Super interesting. I love the clarity around a go-to market strategy for you. That's very unique, especially in the climate space where almost every company has to go through some round of multiple year cycle of piloting before seeing revenue. So it sounds like you tried to pick a category where you believed you could just go straight to market. And do those early sales go? I know we're going right into the go-to the market piece before you even talk about the business, but this is interesting.
Insiya Jafferjee (21:18):
Yeah. Fortunately or unfortunately, I think it depends on how you look at it. We, at the time, didn't have any money. And we had done this as a master's project and we were like, okay, we wanted to do this further. So we all moved into my colleagues' house in Wales who had a workshop, and we set a goal that every three months, we have to sell something. It doesn't matter what we sell, we just have to sell something. And so that was still when we were experimenting with shellfish waste so we could make sheets, we could make cups and then we could make really random other things. So we were like, "Let's start with sheets. We can't set a sheet as a bag because a bag is super cheap, but we can set a sheet for an exhibition that looks cool." So we made 2,000 sheets. And then in making the 2000 sheets, we were like, nothing works.
Insiya Jafferjee (22:08):
So we were like, "Okay, so sheets are probably not viable. Let's go to cups." And we were like, to be honest, we can't sell cups for food and drink because we haven't tested the material or all of the other regulation aspects that come from food. So we were like, "Well, we could make candles." So we tried to make candles and sell the candles. And again, wouldn't say that we had much success there. But we kept trying every three months, and we had a very strong target goal, and we had to sell it. That was it. We didn't have to sell many, but we had to sell it. And it just instilled in us this way of working. Originally, we didn't know how to make molds because we couldn't get aluminum. So we would go to a scrapyard, we would get waste aluminum, and then we would sand cast it in that shed into a mold to make the product.
Insiya Jafferjee (22:58):
And I think because of that, we made so many connections. People want to help us now, because they were like, "Oh yeah, I can't believe you've been making molds like this. Let me give you a mold." And now, our product development cycles are slightly longer. So now six months is a bit more realistic, because three months is a bit too wild, especially for a physical product, but it just pushed us. We learned so much. And then we would see how people interacted with the product. And then we would see who would buy it, who wouldn't buy it, why they were interested in buying it, and that taught us a lot. So it was a different way. It was us trying to test our product in a software way, if that makes sense, as a physical way.
Cody Simms (23:42):
Yeah. And it's such a good go-to market lesson, I think for people listening. It's not going to work for every type of business or product, but especially in the climate space, I get the sense that there's a lot of entrepreneurs driven by, can we do this, and how good it will be when we do this, but sometimes forgetting that, at the end of the day, the way to ultimately scale it is to have a business. And so building something that people want to buy and holding ourselves accountable to people buying it, is a really interesting early KPI to have established for yourselves.
Insiya Jafferjee (24:14):
Yeah. It was definitely the wild wild west in those days.
Cody Simms (24:18):
Well, okay I've set up the industry. We've dived all the way into the backstory. What is the company today? Tell us what Shellworks is, tell us what you're focused on and let's make sure we cover the current presence of the business.
Insiya Jafferjee (24:33):
Yeah. So essentially, our goal has always been to make plastic waste a thing of the past. We actually think plastic is a great material, but it's not been used for the right kinds of applications. So how do we make materials that last only as long as they need to. When we started, as you rightly pointed out, we were looking at shellfish waste, extracting a biopolymer from that. But quite quickly, we came across two challenges, the first being material in the sense where it was an amazing material, but for limited applications, and we knew we wanted to go bigger than that. And the second was, the product wasn't vegan. And that kind of was a clash with our core strong base customers, because they care. They want their products to be vegan because of everything in it. And so then it felt a little bit jarring.
Insiya Jafferjee (25:20):
So we pivoted, I could say a year after in, where we started coming across technologies, which I'm sure has been on the show before, which is polyhydroxyalkanoate, it's a type of bacteria that lives in soil and marine environments that in their cell has the ability to build up granules, that if you extract it, can behave like a thermoplastic. But if you throw it away, the same bacteria in marine and soil environments can see it as food and break it down. But the core issue we found with the producers in the market was that they were having difficulties getting it adopted by customers as well as they didn't work on the material formulation piece or the manufacturing piece. So that started to become our easy way in. So we started looking at how do we formulate, with these polymers, for new applications, and how do we create products that are mono-material essentially?
Insiya Jafferjee (26:20):
So that's kind of been our core offering, and then we do a little bit of the upstream, but we kind of work with partners on that for the most part, and then we do a lot of the formulating, design of the products, the manufacturing of the products, figuring out how to use things that people don't think about making. You want to pantone-match this jar? Sure. We'll figure out how to pantone-match this jar with a natural pigment on top of everything else that we're doing, or you need decoration printing or engraving? Okay, we'll figure out how to do that as well in this material. So yeah, it's been quite a while the journey, I guess till date, and we just did our first big... We've replaced company's entire series of packaging, which was super exciting. And now we're looking at scaling from there. So yeah, it feels like we're at this stage where the product is out in the world, like we're alive, which is something quite exciting.
Cody Simms (27:18):
I love it. And going back to your, we want to sell a certain amount every three months, what does that look like recently? It sounds like you were hitting some commercial traction.
Insiya Jafferjee (27:27):
Yeah. So we kind of sold almost up to 100,000 pieces of packaging to a brand called Hackles, who could not have been a better partner because they truly care about sustainability. They do things like, when they first got our piece of packaging, they composted it in their home to see if it actually home-composted. And I was like, "Amazing." Slightly terrified, but also like, "Amazing that you did that. So many people wouldn't." And then yeah, I think they also are having their own traction, they're challenger-brand, they're challenging the industry. And so they just got investment from Estée Lauder, which then opens up like, okay, well now we have the credibility of working with someone that Estée Lauder has invested in. And so that's kind of been a nice jumping off point for us.
Cody Simms (28:17):
We're going to take a short break right now, so our partner, Yin, can share more about the MCJ membership option.
Yin Lu (28:24):
Hey folks, Yin here, a partner at MCJ Collective. I want to take a quick minute to tell you about our MCJ membership community, which was born out of a collective thirst for peer-to-peer learning and doing that goes beyond just listening to the podcast. We started in 2019, and have since then grown to 2,000 members globally. Each week, we're inspired by people who join with differing backgrounds and perspectives. And while those perspectives are different, we all share in common, is a deep curiosity to learn and biased to action around ways to accelerate solutions to climate change.
Yin Lu (28:53):
Some awesome initiatives have come out of the community. A number of founding teams have met, nonprofits have been established. A bunch of hiring has been done. Many early stage investments have been made, as well as ongoing events and programming like monthly women in climate meetups, idea jam sessions for early stage founders, climate book club, art workshops and more. So whether you've been in climate for a while or just embarking on your journey, having a community to support you is important. If you want to learn more, head over to mcjcollective.com, and click on the members tab at the top. Thanks, and enjoy the rest of the show.
Cody Simms (29:26):
All right, back to the show. Are there any use cases that you've found so far you're not a fit with? Qualifying leads is one thing as great leads, but also identifying, hey, we know within the first 20 minutes of talking to this person that we're not going to be a fit for them, what does that look like?
Insiya Jafferjee (29:47):
Yeah. It's a tough one. So we are, through and through, very hardcore sustainability. That's like the company, that's our ethos, that's the team. If we do something, everyone's like, "Hey, how are we going to transition away from doing this?" Even if it's not to do with our product like say, hey, we have to pallet-wrap our packaging when it goes on a pallet, that's plastic. So that's just the vibe of the team. And sometimes, when we speak to customers, they have their heart in the right place, but maybe they want to only change like 60% of that packaging, or maybe they aren't using natural ingredients. And we're very aware of the challenges with end-of-life, and I think we don't want to create a new problem. So often, if it has to be a halfway solution, we tend to stay away, because it's probably not the right fit for us. And it might cause more issues that we aren't able to solve.
Cody Simms (30:46):
It feels like when I talk to big manufacturers, when they're talking about early stage material startups, the thing that they always hammer on, which to me feels like I can't believe that this is the thing that is holding people back, but you mentioned it, it's color matching. It's the ability to get a piece of packaging to look exactly precisely like their brand color. Are you seeing that start to change, or am I correctly reading that that is a big challenge?
Insiya Jafferjee (31:13):
It's definitely part of the challenge. People are flexible, but to a point. So we work really hard to get them that match, to their pantone, and then we'll be like, "Okay, it's a natural pigment, so there's going to be a variability from here to here, and we'll show you that range so that you're aware." But yeah, it's what manufacturers care about like how do you automatically fill this product on the line, how do you print it, what is the cycle time, how long it takes, what are the yields. And I think all of this is what builds into that cost competitive piece or performance piece.
Cody Simms (31:50):
Yeah. And I think, back to our earlier part of the conversation, to some extent, that will become a brand promise of some companies, which is yeah we look natural. That's a good thing. And some are still going to want to have the super vivid artificial, yellow part of their brand or whatever. And to some extent, I predict, over the next decade, they will start to become industry laggards, but maybe I'm eating my own dog food too much here. I don't know.
Insiya Jafferjee (32:15):
I hope that we'll be able to provide them the vivid essentially, and so that they don't have to compromise, and that they can still express their brand in the way that they choose to, and will find a way to do it in a sustainable way. I think that's kind of our promise or our vision.
Cody Simms (32:32):
That's good. That's probably even a better answer than what I gave, because my answer was, to some extent, the green premium version of packaging, whereas you're saying no, we can make it just better, but we'll do it in a better way. That's a better answer, assuming you can pull it off. I guess that's what we are all hoping on.
Insiya Jafferjee (32:50):
Exactly. We're optimistic. I also think sometimes it's also frame of mind. I think when we started, people were like, "There's no way you're going to be able to do these things." And we were like, "Nah, we can do it." And so I think that naivity helps because it gives you that optimism to keep going, because it can be a bit disheartening sometimes, because it is quite difficult and it is a lot of failures. Every three months we sold something and it didn't work most of the time.
Cody Simms (33:20):
So color, we talked about. What are the other big challenges that, you said a brand that might be 60% of the way committed, what are those last 40% of things that you've found is hard to get them to fully move on?
Insiya Jafferjee (33:36):
Well, I think the other 40% is that we are very new. So for example, they have data saying a consumer will prefer X because of these reasons, but they don't have any data on us. And so I think it's a risk, and I think the risk takers will take the risk. But we ultimately still fall into a category of taking, in their eyes, a big risk, because what if we can't deliver? What if we are the supply chain problem? I think it's the ones who are going to be truly committed to the cause that are like, "Hey, we're going to help you solve those problems."
Cody Simms (34:12):
Got it. That's normal feedback for any startup, which is like, can you scale. That's not necessarily even a natural biodegradable material question. It's just, "Can you hit my targets?" What does that look like for you? I presume you're having to build bigger and bigger bioreactors to enable more material. What does scaling up mean for Shellworks?
Insiya Jafferjee (34:31):
Yeah. So I think on the material front where I find, because we work with ourselves, but we also work with partners and that's how we come to the formulation, and we aren't as reliant onto our own target. So we're fine on that. I think it's just operationally as well, just catching up to the scale, because it does work with traditional manufacturing processes, but it's not easy. So it's not like you can put polypropylene and any tool in the world and it will work. It's not as straightforward. So that stuff takes time. And I think for us, we think about scaling in 10X multiples. So we did first do 1,000 pieces. We did 5,000, we did 20,000, then we did 100,000, now we're looking at doing 300,000, 500,000 and then a million. That's how we think about it. And that's more of, sometimes a time factor, more than anything else. It just unfortunately takes that time to build it up.
Cody Simms (35:30):
And I'm loosely familiar with what the manufacturing process looks like with traditional plastics, you have injection molding and sort of large scale manufacturing facilities. What does it look like with your materials?
Insiya Jafferjee (35:44):
It's pretty much the same. So we still use injection molding. In fact, we have a 50-ton injection molder downstairs in our office. There's a process called... It's like formulation, which happens through a compounder. We have a pretty large piece of kit that does that as well, but we try to leverage industry standard equipment and make changes on our end, so that when we go to third party providers to do very large runs, like for this 100,000 order, we had to do that. We kind of knew one for one, what's going to work, what's not going to work.
Cody Simms (36:17):
Yeah. And so as you think about scaling, like right now, you're having to do a little bit of everything. You're having to actually design the material, you're having to then do the industrial design around what the packaging would look like. You're having to design the dyes, you're having to do the dye testing, you're having to design the sealant I presume. And then you're having to actually manufacture it at scale as your company grows. I don't expect you would think you need to be world class in every single one of those. Where do you see your core focus being over time, and where do you hope that the industry can start to adopt your technology?
Insiya Jafferjee (36:53):
Yeah. So I think there's kind of three core value ads. The first is a little bit on that future R&D space where we can work with suppliers to input to them, "Hey, actually if you design your strains slightly differently, it's probably going to be more commercial based on our insights, of really understanding polymer production." The second is the material formulation. And I think this is something in natural materials that just hasn't been explored as much. Companies like DuPont and 3M, they do this on large scale for traditional plastics, but no one's really looking at it for natural materials.
Insiya Jafferjee (37:33):
And then the third will be the engineering of the solution so that we can provide a natural sealant, so that we can provide a modern material pump, because you kind of do need to think about the product in a slightly different way with these materials as well. And that's also starting to become a value add to customers. It's like when we say, "Oh hey, the sealant is a big one. No one has had a natural gasket." And we would like, "Oh, we just solved that problem for ourselves." And they're like, "Well, can you sell us the gasket now? Because we need it for all of our other products." And I was like, "Okay, we can think about doing that. I never thought about it." But I think sometimes because we solve problems to ourselves, we find new opportunities.
Cody Simms (38:14):
Walk us through that use case. I want to understand more about how you solved it for yourselves and then how you turned to commercialize it.
Insiya Jafferjee (38:19):
Yeah. So we wanted to make a cream container. And a cream container is something that can hold multiple different types of materials. So oils, serums, creams, water. And so seeling it and having it as close to an air-tight seal is pretty important. And the way that traditionally you have it is, if you open any container at the top, you'll see this foam plastic material. And no one's been able to get rid of that. And we wanted to ship a jar, and we were like, "Hey, we want it to be more material because we don't want to compromise on the end-of-life. So we've kind of been developing a blend of this material in the background, and then we were shooting some parts and we were able to create a seal-end gasket that is mono-material.
Insiya Jafferjee (39:08):
So it's kind of a happy accident, I guess maybe, because we were like, "We have to solve this." We looked at so many different things. Like we were developing our own cork glue for some time, because most corks are bound together by polyurethane actually, and so that's another whole myth that we were like, "Oh, we guess we can't really work on that." We developed a shive component in the interim because the shive is also another type of sealant and can be a rigid material, and now we have this flexible gasket that we can use. Yeah.
Cody Simms (39:41):
I love it. And it sounds like that's part of just the culture you built, is if you've said an uncompromising internal culture that everything we do is sustainable, you'll solve your own internal problems first, and then some of those may be commercialized.
Insiya Jafferjee (39:54):
Yeah. I think that's what we've started to notice, is that uncompromising nature, even though it's difficult or challenging, has opened up a lot of opportunities for us.
Cody Simms (40:05):
What have been the biggest pressure tests on that in your internal culture, where you've even had to have hard conversations with each other about things?
Insiya Jafferjee (40:15):
There are so many. We were having trouble molding it and we had sent it to an external supplier, and it was a large portion of material, and they were like, "Hey, it's working now." And then when we looked at how they made it work, they added a percent of polypropylene. And so then we had batches of material that we had to like, we don't want to waste this material, but we don't want to ship this material. So what do we do with this material, or we were having trouble integrating something into our formula, and they had to put it into an oil. And the only oil that they had on hand was mineral oil. Then mineral oil is petroleum based. And then again, we end up with batches of material that we don't know what we can do with. So we have now many bags of purge material that we use internally to purge the machines.
Cody Simms (41:05):
That was the use case of what you do with this sort of tainted materials. You use it as essentially cleaning for your machines?
Insiya Jafferjee (41:12):
Yeah, exactly. Yeah. There's so many things. Sometimes, we just have to say, "Hey, we're going to put it in a box, and we're going to find a use for it at some point," and often we do. But yeah, I think we don't let it leave us to a customer. We either choose not to ship it or we choose to delay it, or most people wouldn't hear about all of the things that we scrapped in the background.
Cody Simms (41:40):
Awesome. What's next?
Insiya Jafferjee (41:44):
It's an exciting time. We have quite some exciting new product development as well as scaling up our current range. So for context, we sell these cream containers and this little thing that we call Tippy, which is our take on a mono-material dropper. It's the first iteration, we have more to come. And then the background, yeah we're working on new products that are more complicated, like a mono-material pump, re-envisioning what that could look like, because it's a huge problem for the industry. So I think we're keen on taking those big challenges, challenges that even plastics couldn't take on, we want to go for it and find a way to, I think, be that better packaging. We don't compromise on it and we're going to give it to you sustainable performant and cost competitive.
Cody Simms (42:33):
Well, and presumably, in this supply chain challenged world we live in today, having mono-material packaging should be a huge benefit.
Insiya Jafferjee (42:45):
It should be a huge simplification, exactly. And so I think we'll start to see the benefits of that as well. I think simplistic is going to push us in a better direction, because we're going to require less material, things are going to be lighter, and it's going to be less components.
Cody Simms (43:00):
And what does, I don't know if you would call it sales, but probably more business development process look like for you right now, when you're out talking to a brand who has a new problem, it sounds like a lot of times you're randomly coming up with stuff in your internal culture and you think, "Oh, maybe we could productize this," but I assume in other instances, you're out talking to a company and they say, "Hey, we have this issue." How much of your conversations have to revolve around R&D today and how much of it is turning more into a straight sales conversation?
Insiya Jafferjee (43:33):
It's a shift we're going through right now. So we created the catalog of products, and that catalog should be going into the sales cycle. And in the background, the challenge is that packaging companies or the beauty companies we're targeting, they use different types of packaging, and it's hard for them to switch with just one skew. So in the background, that's what we're working on is what the future of our catalog could look like by taking in the customer insights. So it's a little 50-50, I would say. And we're trying to also split our time a little bit more like that, because it has been like 90-10, 90% R&D and 10% sales. But yeah it's an interesting transition. But yeah, we've been fortunate. It's such a big problem. Customers reach out to us all the time. So we get to have very fluid, honest conversations with them, and we can get those insights without having to search for them.
Cody Simms (44:30):
It's probably also going to require new and different skill sets on the team to get people who love scaling versus people who love building or experimenting.
Insiya Jafferjee (44:39):
Yeah. We have already kind of gone through a little bit of that transition, but we try to find the both. Like it's a unicorn often, but someone who likes to still work with their hands, but is a bit structured and is like, "Okay, I can do this for an hour, but now I'm going to go and scale everything." But yeah, I think eventually we'll have to transition to people in general who are more growth-focused. I think it's always the challenges of startups is that the company changes every three to six months, because what you're trying to solve is such a different type of problem.
Cody Simms (45:12):
Yeah. From a capitalization perspective, you've raised, I think just under $8 million USD or so in funding. Is that about right?
Insiya Jafferjee (45:20):
Yeah. So I think we raised 7.1 or two million today. Yeah, we were fortunate enough to just, we raised our seed round in May, so pretty recently from local globe in the UK. And then we had a number of US investors as well, as found a collective in Box Group.
Cody Simms (45:40):
That's great. And Box, I think has been involved with you all since close to the beginning. Is that right?
Insiya Jafferjee (45:44):
Yeah. Box Group was the changing of the tide for us. I'd never really thought about investment and I was very skeptical, but then I met Box and I was like, I really love them. Let's do it. And they've been instrumental or just the biggest cheerleaders.
Cody Simms (46:02):
How did you meet them originally? What did that look like? Because it sounds like you were some crazy hackers off in Whales doing stuff and then all of a sudden, "Oh, we're going to build a venture-scaled business." What did that look like?
Insiya Jafferjee (46:13):
To be honest, it came from maybe not the best experience. We were raising funding. It was quite challenging in the UK, and we kind of had a fund that we didn't really align with. And so we had done all this effort. We were close to closing around, and then I kind of decided we're not going forward. And then we were like, "Okay, so now what? We just said no to any money and we have to start from scratch." And I reached out to all my friends in the US, and I was like, "Hey, I'm starting from scratch." I hadn't thought about raising from the US at the time. I was like, "Can you just give me any and all advice?" And I probably had connected with so many VCs in a span of a week that people were like, "Wait. Who is this company? What are they doing?"
Insiya Jafferjee (46:56):
And so I got that introduction to Adam from that, and that's how it all ended up working out. But yeah, I think that negative reaction was probably the best thing that could have happened to me because I was just much more scrutinous of who was coming on board on the journey and also much more honest about who I was and what we needed. And I think that's kind of the best way to raise funding, is just being on the same page as the partners you're bringing on.
Cody Simms (47:27):
It sounds like a continued thread, I'm hearing about how you're building the business, which is being really true to your principles.
Insiya Jafferjee (47:33):
It's tough sometimes, but I think, yeah it's hard to move away from that. I think it's the underpinning of who we are as people and that's served us really well, being true to that.
Cody Simms (47:46):
Well, for those listening who are inspired by your story, where are you needing help right now?
Insiya Jafferjee (47:51):
I'm always really interested to speak to people with new unique material needs. I think we're trying to learn more and more about the ecosystem. And then yeah, if you're interested in joining Shellworks, we'll be hiring for a bunch of new roles soon. So yeah, we are looking for some good strong people to come and join us.
Cody Simms (48:11):
Awesome. Insiya, what should I have asked that I didn't ask?
Insiya Jafferjee (48:15):
I think you covered it all. This was great, I really enjoyed the conversation. Thank you.
Cody Simms (48:19):
Well, so did I. Thanks for joining, and I can't wait to see all the amazing brands that are going to be winning design awards in the future for sustainable packaging, not just flashy brand packaging.
Insiya Jafferjee (48:31):
Yeah. It's going to happen soon.
Cody Simms (48:32):
... or how about sustainable and flashy brand packaging, right?
Insiya Jafferjee (48:36):
Exactly.
Cody Simms (48:39):
Well, fantastic. Thanks for your time today.
Insiya Jafferjee (48:41):
Thank you.
Jason Jacobs (48:43):
Thanks again for joining us on my climate journey podcast.
Cody Simms (48:46):
At MCJ Collective, we're all about powering collective innovation for climate solutions, by breaking down silos and unleashing problem solving capacity. To do this, we focus on three main pillars, content, like this podcast and our weekly newsletter, capital to fund companies that are working to address climate change, and our member community to bring people together as Yin described earlier.
Jason Jacobs (49:08):
If you'd like to learn more about MCJ Collective, visit us at www.mcjcollective.com. And if you have guest suggestions, feel free to let us know on Twitter @MCJPod.
Cody Simms (49:23):
Thanks and see you in the next episode.