Game on How to have fun, develop new skills and drive business growth - Bridgepoint
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Intelligent Investing from Bridgepoint
May 2021 | Issue 39
Game
on
How to have fun, develop new skills
and drive business growth
The art of reduction Lessons from the locker room On the rebound
Getting the food Patrik Nilsson on ice hockey, The sharing economy in a
industry into shape leadership and Vitamin Well post-pandemic world
02 22
• Ins & outs • Analysis
Bridgepoint news In sharing we trust
The sharing economy has been hit by
04 a series of blows over the past year.
Does this sector have a future, or has
• Business
it been permanently tarnished?
Rules of the game
Games were once associated
exclusively with play. Today, they are 28
used to learn new skills, recruit staff • Management
and drive business growth. But Think fast
gamification still needs to be handled Making the right decisions is integral
with care to business success, so firms that
consider how best to tackle their
10 decision-making processes can secure
real advantage
• In focus
War on waste
More than a billion tons of food is lost 32
or wasted worldwide every year. • Viewpoint
Reducing this could benefit Silent epidemic
businesses across the value chain – Mental health used to be a taboo
and cut down harmful emissions too topic in the workplace. Now, there
are real signs of change, as
16 businesses recognise the critical
importance of mental resilience for
• The interview employees and other stakeholders
A good sport
Patrik Nilsson played ice hockey for
Sweden, ran Adidas in North America 36
and led the leisurewear brand, Gant. • Last word
Now, he chairs Bridgepoint-backed Animal magic
Vitamin Well Parks are filled with dog-walkers, vets
are turning away new customers, pet
shops are booming, even egg-laying
chickens are in short supply. The
world has gone pet mad – but not
everyone is happy about it
•Foreword
Game changers
When entire countries and even the security services deploy it, you have to ask
yourself what gamification really is. Memorably described as ‘when video
games and business have a baby’, it is the process of applying the
psychological and entertaining aspects of game-playing to other activities to
make them more fun, increase engagement and improve results. In this edition
of The Point (‘Rules of the game’, page 4), we analyse how savvy businesses
are using gamification to drive customer loyalty and even influence behaviour
– and ask whether its powerful appeal might also have a darker side.
The rise of the sharing economy and the US, before becoming CEO of
continues apace, even though a deadly Gant and then chairman of Vitamin
pandemic seems to have undercut the Well. It’s a fascinating story with some
sector’s core proposition. We examine interesting insights about team
how businesses in this industry can motivation (‘A good sport’, page 16).
overcome some of the obstacles they Since our last edition, Bridgepoint
face and seek out fresh opportunities in has been busy, making investments in
a post-Covid world (‘In sharing we Swiss cybersecurity specialist
trust’, page 22). Infinigate, US fruit genetics pioneer Sun
Until recently, mental resilience was World, UK digital marketing agency
seldom discussed or even recognised as IDHL, Swedish medical dermatology
an issue in the workplace. Wind forward services provider Diagnostiskt Centrum
to today, and there is an increasing Hud and UK pharma and biotech
awareness that firms need to advisory firm Prescient. We also
acknowledge and understand it for the successfully exited our investment in
good of their employees and their Calypso Technology in the US, one of
business. That’s why in ‘Silent the foremost providers of software to the
May 2021 epidemic’ (page 32), The Point tries to global capital markets industry (‘Ins &
Issue 39
Published by assess the scale of the issue and learn outs’, page 2).
Bladonmore
Editor
how forward-looking companies are We hope you enjoy this edition of
Joanne Hart working through it. The Point. As always, we welcome your
Design
Bagshawe Associates
Reproduction, copying
In this edition, we are also profiling feedback via thepoint@bridgepoint.eu •
or extracting by any
the chairman of one of our fastest-
means of the whole or
part of this publication
growing consumer companies – Patrik
must not be undertaken
without the written Nilsson of functional drinks and food
permission of the
publishers. group Vitamin Well. A champion
The views expressed in
The Point are not
ice-hockey player in his youth, he opted William Jackson
necessarily those of
Bridgepoint.
for a career in business, eventually is managing partner
www.bridgepoint.eu heading Adidas in the Nordic region of Bridgepoint
01
•Ins&outs | Bridgepoint news
Here comes
the sun
Sun World is a global pioneer in fruit genetics
with a track record stretching back to the
1970s. Bridgepoint has now acquired the
California-based company, which owns more
than 300 plant patents and licenses around
1,800 growers in 15 countries, including Chile,
Israel, South Africa and Spain.
The transaction is designed to drive growth
at Sun World by building a broad-based
genetics and technology platform for
Bridgepoint snaps up speciality fruit growers. The company
traditionally works with grapes and stone
Swiss cybersecurity firm fruit but has recently begun studying several
underserved crops and technology to support
them. There are also opportunities to acquire
Bridgepoint has acquired one of Europe’s leading
new genetics and emerging technologies.
cybersecurity specialists, Infinigate “Sun World was part of the first wave of
The enterprise cybersecurity The group was founded in 1996 genetic innovation for produce, establishing a
market is one of the fastest and has grown consistently over
growing in Western Europe. Worth the past 25 years. Employees now
an estimated €10 billion, it is exceed 450 and the business is
expanding by around 10 per cent expected to have generated gross
annually as the revenues of more
threat of cybercrime than €600 million in
intensifies, the year to
companies’ March 2021.
information technology systems Led by CEO Klaus Schlichtherle,
become more complex and Infinigate focuses on innovative recurring royalty business model that has
regulations around data protection and specialised security solutions, enabled it to prioritise R&D innovation. Today
grow increasingly stringent. complemented by dedicated it enjoys a market-leading reputation with the
Infinigate is the foremost technical, marketing, sales and largest growers, distribution partners and
distributor of value-added professional services for both retailers globally thanks to its cutting-edge
cybersecurity solutions in partners and vendors. molecular techniques and breeding
Germany, Austria, Switzerland and Bridgepoint partner Christopher processes. We expect to continue to invest in
the Nordic region, and is ranked Brackmann says: “Infinigate is an new technologies that benefit growers and
number two in Europe. exciting platform in a growth consumers alike,” says Bridgepoint partner
Headquartered in Rotkreuz, market, with an experienced Andrew Sweet.
Switzerland, it offers state-of-the- management team. With Sun World, led by CEO David Marguleas,
art security solutions from more Bridgepoint’s support, it will be recently opened an innovation centre,
than 70 vendors through a well placed to capitalise on its featuring a sophisticated fruit breeding
network of more than high-quality vendor base and long- and variety development operation and a
10,000 partners. standing reseller relationships.” • 160-acre research farm •
BDC teams up with marketing agency as growth soars
IDHL is a fast-growing digital With more than 240 staff, growth in 2020, with unaudited Dennis Engel has amassed a
marketing agency based in IDHL helps businesses across the EBITDA of £5.6 million and portfolio of seven brands
Harrogate, Yorkshire. UK to maximise their digital revenues of £19.4 million, across five locations.
Bridgepoint Development potential through search engine an increase of nearly Supported by BDC,
Capital has now partnered with marketing, automated email 40 per cent from 2019. Engel now hopes to build
the business providing a marketing, e-commerce and web Having completed on IDHL’s acquisition
substantial investment to foster design and build. several acquisitions in record, both at home
and drive future growth. The company delivered record recent years, CEO and founder and overseas •
02
An exit for Calypso after business transformation
Leading financial software
specialist Calypso Technology has
been sold by Bridgepoint
San Francisco-based Calypso Technology is one
of the foremost providers of software to the
capital markets industry, with a suite of products
encompassing trading, risk management,
regulatory reporting and accounting.
The group’s award-winning software improves through a period of significant transition of the business to a
reliability, adaptability and scalability across transformation. Internal processes cloud model, combined with
several areas of the financial services industry, were enhanced, the management best-in-class client service, was
such as capital markets, investment team was upgraded and the undoubtedly key in accelerating
management, central banking, clearing, company moved from selling growth. The business is now well
treasury, liquidity and collateral. perpetual one-off placed for the next
Acquired by Bridgepoint in 2016, Calypso’s licences to offering stage of its evolution,”
products are now used by some 35,000 market software as a service, says David Nicault,
professionals in more than 60 countries via annual licences. partner and global head
worldwide. These customers represent more “We are proud to have partnered of digital, technology and media
than 190 financial institutions, including banks, with Calypso and its management at Bridgepoint.
insurers, asset managers and pension funds. team through this time. Alongside a Calypso has been sold to US
Over the past five years, the business has been range of operational initiatives, the private equity firm Thoma Bravo •
Swedish dermatology BDC acquisition set to boost
group wins backing pharmaceutical advisory firm
for expansion Bridgepoint Development Capital
has acquired Prescient, a global
Bridgepoint Growth has Sweden, operating advisory firm serving the pharma-
invested in Diagnostiskt from six clinics across ceutical and biotech industries.
Centrum Hud (DCH), the four cities. With a Founded in 2007, Prescient
foremost provider of high-quality platform,
provides product strategy services
medical dermatology the group is well placed
to help its clients make better
services in Sweden. for growth in the
The company was fragmented dermatology clinical and commercial decisions,
founded in 2012 by CEO markets of Northern resulting in enhanced outcomes
Philip Jerlmyr and three Europe. for patients.
dermatologists to “We are very Over the years, the business
address demand for impressed by DCH’s has developed a reputation for
high-quality medical successful expansion to combining expertise, experience and consolidate
dermatology treatments. date, creating the
and evidence to help clients its market
Headquartered in leading dermatology
Stockholm, DCH focuses provider focused on maximise the potential of their leadership. This
on treating melanoma, clinical excellence and products, at every stage of the will be achieved through a
psoriasis and other high customer drug development and combination of investment to
severe dermatology commercialisation process. enhance scale and expertise,
conditions. Headquartered in London, with organic growth and selective
This market is offices in the US, India and China, mergers and acquisitions, with the
underpinned by
Prescient works with many leading aim of becoming the leading
structural growth satisfaction, thanks to
multinational pharmaceutical technology- and data-enabled
drivers, including an its having the best
aging population and dermatologists. We look companies, as well as a growing strategic product partner of choice
an increase in skin forward to supporting number of emerging biotech and for decision support and advisory
diseases, such as the DCH team in its next speciality pharmaceutical services to the large pharma
skin cancer. phase of expansion,” organisations. industry,” says Bridgepoint
Today DCH is the clear says Bridgepoint Growth “We’re delighted to partner with Development Capital partner
market leader in partner Ann Dahlman • Prescient to help it drive growth Stephen Bonnard •
03
•Business Rules of the game Games were once the preserve of children, but today they are deployed across markets and industries, for everything from learning new skills to buying goods online and recruiting staff. Used wisely, they can be a real force for good. But there are dangers to gamification, too. 04
iven the choice between watching fitness industry, as rewards,
a corporate training video or badges and leaderboard
playing a compelling computer competitions are employed to
game, there’s little doubt which maximise motivation.
option most people would choose. But the techniques can be
So it is perhaps not surprising applied to virtually any business or
that forward-thinking businesses sector, says Toby Beresford, the
are increasingly looking at author of Infinite Gamification:
gamification as a way to keep Motivate your team until the end of
employees and customers engaged. time. “If you can count something,
Put simply, gamification is it can be gamified,” he says.
the process of applying the “As soon as you put a target number
psychological and entertaining in front of a person or organisation,
aspects of game playing to other you are gamifying. You have
activities to make them more fun, turned them into a player.”
increase engagement and improve
results. Or, as Mario Herger, That special feeling
founder of innovation consultancy The term gamification emerged
Enterprise Garage, puts it: in the early 2000s, coined by
“Gamification is when video British computer programmer Nick
games and business have a baby.” Pelling. But the concept has been
around for much longer, as
Gold stars Beresford explains. “Just look back
Some markets, for example to the Boy Scout movement in the
education, are particularly suited early 1900s, where achievements
to the concept. Teachers have been were rewarded with badges,”
awarding gold stars or black marks he says.
for centuries, so the process of Even eBay, established in 1995,
encouraging good behaviour and uses the thrill of competition to
chastising bad is built into the keep people interested. Customers
sector. Gamification is also widely bid to buy goods via the website’s
employed in the ever-expanding time-limited auctions. When their
If you can count something, it can be gamified.
As soon as you put a target number in front of a
person or organisation, you are gamifying.
You have turned them into a player
05
• Business | Rules of the game
D G J U D G
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$2 billion in a funding round and
Britain’s intelligence agency, is considering a flotation this year.
GCHQ, deployed gamification to Duolingo’s growth has been
help recruit future generations dramatic, as customers have
of spies signed up for courses that use
traditional gaming techniques,
such as leaderboards and badges,
offer is accepted, they’re told: to keep students motivated.
“You’ve won!” Offering tuition in around
“This is gamification at its most 40 languages, the group’s reach
primal,” says Andrea Thorpe, a extends to lesser-known tongues,
professor of entrepreneurship, such as Gaelic, Welsh and Navajo
innovation and strategy at France’s – even Star Trek’s Klingon can be
Kedge Business School. People studied on its app. And with more
love to feel like winners, even if than 500 million downloads, it is
they’ve just bought a used kettle. now the world’s most popular way
to learn languages online.
Student motivation Gamification has spread into
One company that has put the political sphere as well. In the
gamification at its core is online US, Donald Trump’s 2020
language course group Duolingo. re-election team developed an app
Launched just nine years ago, the that offered prizes to those who
Pittsburgh-based business was downloaded it and encouraged
recently valued at more than friends to do the same. Points were
06
Business | Rules of the game
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earned for sharing campaign
news, with prizes ranging from a Every time I take a drive, the car tells me
photo with the president for the how ecologically-friendly my journey
most prolific sharers, to a MAGA has been. It gives me a score, which of
(Make America Great Again) hat. course you want to try to beat
Baffling code
Entire countries can deploy agency, GCHQ, for instance, at least some of the qualities
gamification. In an effort to boost deployed gamification to help needed to work there.
post-Covid visitor numbers, the recruit future generations of spies.
New Zealand tourist board has Some years ago, it launched a web Prize draws
developed a sophisticated, page, Can you crack it?, Financial services firms have been
multi-layered video game, billed containing a cryptic puzzle. Those embracing gamification in recent
as “the first gameplay walkthrough few who successfully broke the years. One of the early adopters
of the real world” and offering apparently baffling code were was Spanish bank BBVA, which
users an immersive tour of the rewarded with a hidden message created a game in 2012 to
country’s greatest attractions. revealing a keyword that could be encourage customers to bank
While sales and marketing used to unlock a web address. online. Account holders were
teams the world over will be Once there, the codebreakers awarded points for viewing
familiar with targets and bonuses, were invited to submit a formal information videos, completing
gamification can also be applied to job application. online transactions and
other areas of business, from new The process was fun – at least referring friends.
skills and training to retention and for those who succeeded – and, for The points could be cashed in
recruitment. Britain’s intelligence GCHQ, it yielded applicants with for music and film streaming
07
• Business | Rules of the game
prizes are offered, the game
becomes too addictive, a
distraction from work, or open
to manipulation.
Thorpe explored the moral
aspects of gamification in The
Ethics of Gamification in a
Marketing Context, a paper she
co-wrote with Warwick Business
School’s Stephen Roper.
Published in the Journal of
Business Ethics, it explored the
need for transparency in
gamification, and suggested that
people must be made aware that
they are being gamified.
Grey area
Even before the Reddit-inspired trading frenzy “Employing marketing techniques
over GameStop at the start of the year, there to influence behaviour is standard
were worries that the addictive, game-like practice, but when does
aspect of the Robinhood app might encourage persuasion become manipulation?
Rather than a thin line, it’s a more
financially irresponsible behaviour, particularly
of a ‘fuzzy grey area’,” she says.
from inexperienced investors
The stock trading app
Robinhood, for example, has come
under criticism for gamifying
services, or tickets to La Liga Society offers prizes on its Start to investment. Even before the
football matches. And the process Save accounts and last year Reddit-inspired trading frenzy over
worked. Just six months after its launched a fixed-rate bond that GameStop at the start of the year,
launch, the bank had signed up put savers in a £10,000 prize draw. there were worries that the
100,000 customers to its addictive, game-like aspect of the
online service. Blow to morale app might encourage financially
Prize-linked savings accounts But gamification is not just about irresponsible behaviour, particu-
are becoming more popular, too. In making serious things fun or larly from inexperienced investors.
the US, retail giant Walmart added turning real life into a game, says “Most of us are aware of
a “virtual vault” to its popular Beresford. There can be a dark marketing techniques. We know
prepaid card four years ago to side to it, particularly if the process adverts are used to sell us things,
encourage customers to save. is shrouded in secrecy or “players” they’re not just pretty pictures.
There are monthly prize draws and have no choice but to take part. But with gamification, when it
the app regularly prompts Badly thought-through schemes really works, it goes quite deeply
customers to “stash some cash”. can reap havoc with employee into people’s consciousness, and
The retailer says users have saved morale, with those at the bottom of they are often unaware they are
35 per cent more on average than the scorecard feeling excluded and being manipulated. Some of it
they otherwise would have done. demotivated. Sometimes, works quite deeply and rather
In the UK, Nationwide Building particularly if cash or valuable darkly,” Thorpe says.
08Business | Rules of the game
•
Clear choice what they are signing up to,” delve deeply into people’s psyches.
It’s important that employees and Thorpe adds. In this regard, there “Part of me is a little bit
customers opt in to gamification – are growing concerns about the frightened of the future and how
and not just by signing a increasing power and influence of we might all be manipulated.
small-print waiver that few people the big tech companies. She says: I don’t want to give impression that
bother to read when accepting “They have so much money we’re walking zombie-like into a
terms and conditions. behind them and can invest in dark place, but we do need to
“It needs to be made clear, and really sophisticated methods to be alert.”
people should not be asked to sign
up to something that could be
harmful to them. It’s not good
enough for a company just to say, Badly thought through schemes can reap
‘Well, they agreed to this.’ havoc with employee morale, with those at
Sometimes people don’t realise the bottom of the scorecard feeling
excluded and demotivated
Powerful appeal
Responsible gamification is fun,
though, and it can be used to foster
good behaviour, too. Even Thorpe
admits she enjoys playing along,
particularly in the car she shares
with her husband. “Every time
I take a drive, it tells me how
ecologically friendly my journey
has been. It gives me a score,
which of course you want to try
to beat.
“I’m locked in a battle for best-
ever score with my husband – and
I’m winning at the moment. I know
it’s a game, but it has a powerful
appeal,” she admits •
09•In focus
Waste not,
10T
More than a billion tons of food is lost or wasted
worldwide every year. Reducing this could benefit
businesses from farm to fork, and have a meaningful
impact on climate change, too.
he “vegan meat” the production cost of a cultured
market is expected to chicken breast to just $7.50.
double in size over the United Nations data suggests that
next four years, topping animal agriculture is responsible
$8 billion by 2025, for 14.5 per cent of global
according to market research. greenhouse emissions, so the
Veganism, vegetarianism and ecological upside from such
even flexitarianism are on the rise technologies is obvious.
worldwide, as millions of Of course, replacing steaks and
consumers take the view that meat burgers with lifelike alternatives
and fish-free diets are better for could prove to be a game changer
their health and the planet. in the food industry, but food waste
The trend has provoked a surge has been a hotbed of innovation,
in demand for fake meat, and too. And the commercial and
companies in the sector are ecological potential of companies
booming. Earlier this year, in this area easily rivals that of
Redefine Meat raised $29 million fake meat.
to commercialise its technology,
which uses 3D printing to produce Efficiency savings
plant-based steaks. And Future “Around 1.3 billion tons of the food
Meat Technologies, which produced in the world for human
develops lab-grown meat, recently consumption every year gets lost or
announced it had brought down wasted, equal to over $1 trillion or
over one per cent of global output,”
says Marc Zornes, chief executive
and co-founder of Winnow
Around 1.3 billion tons of the food Solutions, which uses artificial
produced in the world for human intelligence (AI) and sensors to
consumption every year gets lost lower food waste in commercial
or wasted kitchens. “And from a climate
perspective, food waste contributes
11• In focus | War on waste
Food waste contributes around eight per Short shelf life
cent of global greenhouse gas emissions. The inefficiencies start at the
If food waste were a country, it would be source, the farms themselves, says
8% the third-largest emitter of greenhouse Jozef Wallis, chief executive of
gases after the US and China consultancy TerraPrima Group.
“With crops like avocado or
blueberries, it’s important to
harvest them at exactly the right
around eight per cent of global consumption. A report from the time and transfer them to cold
greenhouse gas emissions. If food Ellen MacArthur Foundation and storage fast,” he says. “If you don’t,
waste were a country, it would be Google estimates that technologies their shelf life diminishes by the
the third-largest emitter of employing AI to design out food hour. They can become unsaleable
greenhouse gases after the US waste could help to generate up to or simply last less time on
and China.” $127 billion a year by 2030. Such supermarket shelves before they
With such efficiency savings – innovations range from machine have to be thrown out.”
and ecological gains – in sight, a vision that pinpoints when fruit
new generation of companies has and vegetables are ready for
been sprouting up to reduce picking to algorithms that project Employing artificial
inefficiencies across the entire demand so that supermarkets intelligence to design out
chain of food production and don’t overstock certain foods. food waste could help to
generate up to $127 billion
a year by 2030
12In focus | War on waste
•
Accessible technology emerging markets. TerraPrima’s
TerraPrima’s sensors, spread sensors collect data on such Kitchens can waste up to
around a farm, feed data to an variables as light, soil moisture 20 per cent of food
AI-driven system that informs and temperature, and the purchased, often
farmers about the optimal time to information is fed back to a equivalent to total net
harvest crops and line up logistics, dashboard that uses AI and
profits, because chefs too
as well as improving other aspects machine learning to guide farmers’
often lack the necessary
of efficiency. Such high-tech decisions. Such technologies can
tools to accurately
solutions, Wallis says, have be lined up with innovations from
measure and manage waste
become increasingly accessible other precision agriculture firms –
even to smaller farmers in such as robotic crop pickers or
drones – to significantly reduce
waste. “This all feeds through to Schwartz, the company’s founder.
the bottom line for agricultural “Our system uses AI, deep
firms, improving profit margins, so learning and probabilistic
farmers don’t need to be focused methods, to ensure store managers
on the environment to find this are able to strike the right balance
appealing, though many are, of – helping them to predict
course,” says Wallis. inventory, forecast demand and
optimise ordering decisions.”
Optimising orders This can have a significant
Moving along the chain, a host of effect on the profitability of super-
companies seeks to address the markets, which is usually a
tier of waste once food has low-margin industry. “Grocery
progressed to supermarkets. San chains typically have net margins
Francisco-based Afresh of one to three per cent, while
Technologies has developed waste in fresh food averages
algorithms incorporating variables around five to seven per cent of
such as weather and peak sales,” explains Schwartz. “In
freshness to forecast demand for some cases, by halving waste,
certain fresh produce. “Ordering supermarkets can literally double
the right number of bananas – not their profitability.”
too many, not too few, for
example – simultaneously Far-reaching effects
prevents waste from ordering too The company’s research among
much and prevents lost sales from current customers shows that
ordering too little,” says Matt grocers using the technology have
13• In focus | War on waste
subscription in discounted food.
Some 50,000 companies across
15 countries have partnered with
Too Good To Go to sell surplus
food – from small local bakeries to
large supermarkets such as
Carrefour, and hotel chains such as
Accor. Launched just five years
ago, the group’s app is thought to
have saved around 60 million
meals from going to waste.Yet,
Basch believes the company has
barely scratched the surface of
potential demand. Heading the
group’s push into the US, she
estimates Too Good To Go has so
far reached just five per cent of its
addressable global market.
Motion sensors
Restaurant and hospitality
industries are also profligate
wasters of food. Around one in six
seen chain-wide reductions in food hard to predict, so stores don’t meals served outside the home are
waste of at least 25 per cent – in usually know exactly what food wasted in the UK, according to
some cases significantly higher – will be surplus to requirements the Sustainable Restaurant
and increases in produce on any particular day,” says Association. Globally, food waste
operating margins of around co-founder Lucie Basch. “Our app costs the hospitality industry more
40 per cent. Afresh Technologies’ allows companies to offer ‘surprise than $100 billion annually, money
platform is already deployed in bags’, which increases flexibility it can ill afford to lose after months
hundreds of stores across the US, and also provides consumers with of lockdown restrictions.
including chains such as WinCo an element of novelty.” Part of the waste is due to
Foods, Fresh Thyme Market and kitchen inefficiencies. Kitchens
Heinen’s. Looking ahead, there are New exposure can waste up to 20 per cent of food
plans to expand beyond North This has several benefits for
America, with Europe a clear businesses and their customers,
target market. says Basch. First, the app
Some innovators in this space increases sales and reduces
are moving the other way, from inefficiency. Second, the surprise Too Good To Go has
Europe to the US. Copenhagen- element of the packages exposes developed an app that links
based Too Good To Go has local consumers to products that consumers with local food
developed an app that links they might not otherwise have tried stores, enabling retailers to
consumers with local food stores, – which have the potential to sell food at a discount that
enabling retailers to sell food at a become favourites. Third, would otherwise be
discount that would otherwise be consumers recoup around three thrown away
thrown away. “Food waste is often times the cost of the app
14In focus | War on waste
•
Less Better
waste business
teams pinpoint waste quickly, nears expiry. This is more than
In some cases, by halving giving managers the insights they simply an ecological problem:
waste, supermarkets can need to cut costs and reduce Ovie estimates that such waste
literally double their impact,” says Zornes. “Once you costs the average US household
profitability know where waste is occurring, $2,000 a year. Ovie’s storage kits
improved forecasting and can monitor the freshness of a full
production planning allows you range of produce, which is
address the issue at its root cause.” especially useful since food expiry
purchased, often equivalent to The company calculates that labels can be overly cautious, or
total net profits, because chefs this technology enables clients to hard to interpret by consumers.
too often lack the necessary tools halve their food waste, generally Another solution to this problem
to accurately measure and saving restaurants between three has been proposed by Ynvisible
manage waste. per cent and eight per cent on food and Innoscentia. Based in
“We install motion sensor costs. Total savings have now Vancouver and Stockholm
cameras that capture images of reached $42 million, the company respectively, the two companies
food being thrown away,” explains estimates, with 36.5 million meals have joined forces to produce
Winnow’s Zornes. “Our system is saved, cutting carbon dioxide labels incorporating digital
then able to translate these images emissions by 61,000 tons. sensors that monitor the real-time
into menu items – anything from quality of food.
meatballs to fries.” Smart containers Across the food chain, efforts to
There is plenty of waste to be reduce food waste have produced a
Accurate picture addressed at the final stage of the burgeoning ecosystem of smart
In other words, Winnow takes into food chain too – in our homes. companies and technologies.
consideration the items that Most households throw away an Many of these firms remain at an
individual restaurants are serving eyebrow-raising 40 per cent of the early stage of development, but
so it can more accurately identify food brought home, according to growth is widely expected as
what is being thrown away on each smart food storage group Ovie. businesses, investors and
site, rather than just assess the The Chicago-based company consumers recognise the effect of
quantum of waste. “Our analytics produces containers that turn from food waste on their purse and on
platform and reporting suite help green, to yellow, to red as food the planet•
15•The interview A good spo 16
From world-class ice-hockey player to president of
A
Adidas North America, Patrik Nilsson has been
around sport for most of his life. Now he chairs
Vitamin Well, the fast-growing, Bridgepoint-backed
port
functional food and drinks group.
s a five-year-old boy, US, Canada, Russia and the Czech
Patrik Nilsson would Republic from when I was seven to
stand outside his about 15 or 16. We were one of the
house with a ball, top teams in the world for our age
waiting for the group,” he says.
schoolchildren across the road to Several of Nilsson’s teammates
finish for the day. They were two or went on to become professional
three years older than him, but he ice-hockey players. Nilsson
had a ball so, begrudgingly, they decided to channel his energies
let him join their games. into business instead.
Spotted by a coach one afternoon, “I had an offer to play for one of
Nilsson was soon drafted into the the top teams in Sweden, but I
local football team, even though he needed to do my military service
was younger than everyone else. and once I had done that, I realised
That was in the summer of 1969. that I didn’t really have the skills
Come winter, football gave way to needed to go to the next level. My
ice hockey and, by the early coach used to say that I could play
1970s, he was playing in with eggs in my pockets because I
international tournaments. never went down into the corners
“Our junior team was the best in and fought with the bigger guys!”
Sweden and we travelled to the Nilsson explains.
On day one, I told everyone that we would be
bigger than Nike within three years. I don’t
think many of the 220 employees believed me,
but we got there in two years and by the end of
year three, we were 15 per cent ahead of them
17• The interview | Patrik Nilsson
Engaging attitude
Continuing to play at the My coach used to say that
second level, he decided to I could play with eggs in
take a break before heading my pockets because I
to university. He took some never went down into the
time out and started working corners and fought with
at NK, the top department store the bigger guys
in Stockholm.
“It was there that I realised I was
pretty good at selling. I was
working in the sportswear
department and one of the brands
we stocked was New Balance. The
guys there really engaged with us
and talked to us about what the
business was doing, which made
me think that was the type of
company I would like to work for.
So when customers came in
looking for Nike or Adidas
trainers, I sold them New European Football Championship
Balance ones instead. Sales took place in Sweden. It was
spiked and when the company too good an opportunity to miss
needed a travelling sales rep, so I moved to Adidas,”
they asked me,” says Nilsson. Nilsson explains.
Nilsson went on to spend
Unmissable opportunity 23 years at Adidas, including
Higher education was left 10 years in Germany and three
behind, as Nilsson worked years as managing director for
first for New Balance and the Nordics.
then for Asics. He was “When I arrived back in
happy in his job but, in Sweden, Nike was 10 per cent
1991, Adidas came ahead of us in terms of market
knocking. share. There was no energy, no
“I had always been an passion and people were pretty
Adidas fan because I tired. They’d had three Germans
played in Adidas shoes and an American in charge, none
when I was young and of whom really understood the
the company was one Nordic culture. On day one, I told
of the best in the everyone that we would be bigger
market. They offered than Nike within three years.
me a job as head of I don’t think many of the 220
sales and marketing employees believed me, but we got
for the sports part of the there in two years and by the end of
business in Sweden. This year three, we were 15 per cent
was a year before the UEFA ahead of them,” says Nilsson.
18Cultural differences
“Nike people were very competitive
too. If they heard that we were
Having gained a reputation as a going to be at a party, for instance,
trouble-shooter, Nilsson was asked they wouldn’t go. It was a difficult
if he would like to head up Adidas time but I learnt a lot and grew a
in North America, a business that lot. Leading Americans is very
had been through nine presidents different from leading Germans or Jonas and the team are
in 13 years and was struggling Scandinavians, so you have to be super-impressive, they’ve
against arch-competitor Nike. mindful of the different cultures created an incredible
and work with them. Fundamentally business and no one’s told
Disenchanted staff though, wherever you are, you them how to do it. It’s in
“I talked about the move to my have to inspire people. And for their DNA
wife, Ulla, and we discussed it that, you have to be clear about
with our two boys, who were in the journey that the company
their teens at the time. They all needs to take and the part they can
said yes so we set off for Portland, play in it, without being too rigid
Oregon,” Nilsson says. about what they need to do,” their own way,” he adds.
The job was a tough one. Nike’s Nilsson explains. Nilsson’s jigsaw worked well.
global headquarters are in the “It’s like a jigsaw puzzle. The Between 2007 and 2014, Adidas
same city but, where the US group leaders provide the framework and North America doubled its
employed 8,000 people, Adidas paint the picture of what the turnover and grew EBITDA
had just 800, many of whom were finished work will look like but margins from nothing to around
disenchanted with the business. everyone puts their own pieces in 15 per cent.
19• The interview | Patrik Nilsson
Doubling profits
“More than that though, we built
a culture where people believed
in the business and believed in
the brand. And some of the
people I recruited are now in
leadership positions at the
company. That’s what I am most
proud of because that’s how you
build a sustainable business,
one that can be successful over
the long term,” says Nilsson.
By 2014, Nilsson had taken
on new responsibilities within
Adidas. He found himself
travelling much of the time, importance of teamwork. rival football teams in Stockholm,”
leaving his wife alone, as one son “You need to get everyone Nilsson jokes.
had returned to Sweden and the excited about where you are going, Used to joining companies as a
other was at college. It was time for whether they are a team leader, a problem-solver, Nilsson has taken
a change and that materialised in player on the field or taking care of a very different approach at
the form of an offer to become CEO stuff off pitch. Everyone is Vitamin Well.
of Gant, the designer fashion important, not just you. And if you
group headquartered in Sweden. all work together and you all have Sounding board
Another company that needed conviction, that’s when you can “I’ve spent my life coming into
fresh blood, Gant gave Nilsson the create magic,” he explains. businesses that are in a mess.
opportunity to lead an entire And that is what he found when Vitamin Well is completely
business and return home. Within he joined Vitamin Well. different. Jonas and the team are
four years, profits had doubled and “I was approached to chair the super-impressive, they’ve created
Nilsson had again managed to company in 2017, just after an incredible business and no
build a strong culture that exists to Bridgepoint acquired it. I knew the one’s told them how to do it. It’s in
this day. business, of course, because I’d their DNA. They’ve worked
been using their products for years together for such a long time they
Creating magic and really liked them. I met the can finish each other’s sentences
A sportsman at heart, Nilsson Bridgepoint team and we got on so because they know where they are,
believes the locker room has then I went to meet the founder, they know where they came from
taught him invaluable lessons Jonas Pettersson. We really hit it and they know where they are
about leadership and the off, even though we support arch- going,” he says.
“Jonas already knows about
strategy, he knows about sales and
marketing and he knows about
You need to get everyone excited about leadership so I don’t need to talk to
where you are going, whether they are a him about any of that. I just act as a
team leader, a player on the field or taking sounding board for him and, if he
care of stuff off pitch. Everyone is wants to talk about anything, I am
important, not not just you here to give my point of view. He
doesn’t have to agree with me but
20Name: Patrik Nilsson
Position: Chairman, Vitamin Well
Born: Just outside Stockholm
Education: Tibble Gymnasium
First job: A lifeguard for a local
swimming pool when I was 15
Family: Met my wife Ulla in 1990 and we
have been together ever since. We have
two sons in their 20s, Calle and Pelle
Home: We try to split our time
between the Algarve in Portugal and a
summerhouse in Sweden
Favourite sports: Golf, tennis and
paddleboard
Car: Audi Q8
It’s like a jigsaw puzzle. The leaders provide group’s sales are generated outside
the framework and paint the picture of what Sweden and the product range has
the finished work will look like, but everyone expanded too.
puts in their own pieces in their own way
New brands
From an initial focus on the core
Vitamin Well brand – flavoured
water with added vitamins and
I can offer a different perspective,” move that should drive further minerals – the business has moved
he adds. growth over the next few years. into new brands, such as the
Nilsson believes that the “We now have even more energy drink Nocco and
relationship between the opportunity to develop in the Barebells, a protein bar and
management team and markets that we have recently milkshake division.
Bridgepoint has proved highly moved into, such as the US. And I “Vitamin Well tends to build its
effective too. Vitamin Well has believe that we will continue to brands by first selling to gyms, golf
grown significantly under take market share and grow, clubs, trendy cafes and other
Bridgepoint’s ownership, moving sustainably into the future. premium spots. Only once they
from 80 employees to around 300 There is a genuine desire across have established a certain brand
and expanding into dozens of the company to make the world a image, do they distribute more
markets worldwide, including better place by creating products widely, to supermarkets and online
recent moves into the US, that support a more active lifestyle. platforms, such as Amazon.
Germany, France and the UK. And that passion has a tangible “Of course, many of their
impact on the people and the premium distribution avenues
Active lifestyle culture,” says Nilsson. have been largely closed through
“Bridgepoint seem to have a “The innovation, speed and the pandemic, but the company
culture of supporting and helping courage within this business make still managed to record its best ever
companies rather than rigidly it really stand out. And they are year in 2020. That underlines the
controlling them and that really building communities within their resilience of this business and the
works well here,” says Nilsson. brands, which in turn generates performance of its people. I could
The firm recently made a fresh huge loyalty among consumers,” not be prouder of their efforts,”
investment in Vitamin Well, a he adds. Today, around half the says Nilsson •
21•Analysis 22
W
The sharing economy is not immune to alking the floor of
his family’s
controversy, but it seemed to be going from manufacturing
strength to strength – until the pandemic plant in Mumbai,
struck. Now, as markets look to the future, Rigved Raut was
struck with a realisation: the
what are the prospects for businesses in the machines spent most of their time
sector? Will they regain their old verve, or idle. The company was Raut
Electro-Mech Industries, a maker
have they been permanently undermined? of train components, but Raut
deduced that many businesses
around the world would be in a
similar position to his.
Raut’s lightbulb moment
spawned McPond.com, a
marketplace that turns any plant
into a contract manufacturer by
renting out machines during their
downtime. To get it off the ground,
Raut, 35, relocated to California to
take part in Y Combinator, the
start-up boot camp behind the
launch of tech giants that include
Airbnb, Dropbox and DoorDash.
Change in fortune
Towards the end of 2019, Raut
moved to Chicago to set up shop
in the middle of America’s
manufacturing heartland, but just
months after launching his
machine marketplace, the
pandemic struck. Like countless
businesses around the world,
McPond was hit hard. “Many
factories simply shut down or went
bankrupt,” he explains.
Over last summer, however,
McPond’s fortunes took a
surprising turn. As the economy
yo-yoed from dramatic stoppage to
roaring recovery to renewed
slowdown, plant owners started to
make contact, even though
McPond had yet to begin any
formal marketing. Cash-strapped
companies were intrigued by the
idea of squeezing more revenue
out of machines that were
23• Analysis | In sharing we trust
capitalisation of more than
$100 billion – but it doesn’t own
any cars.
It is perhaps not surprising,
then, that these tech pioneers,
founded less than 15 years ago,
have been followed by thousands
of wannabes, each determined
to revolutionise certain markets
or industries.
There were basketball rental
machines in Beijing and
scooter-hire fledglings the world
over. At one point, 11 mobile phone
charging-bank start-ups were
fighting for supremacy, according
to Arun Sundararajan, a professor
at New York University and author
of The Sharing Economy: The End
of Employment and the Rise of
Crowd-Based Capitalism.
Reasons to be cheerful
The question now, of course, is
how will sharing economy
otherwise sitting silent.The companies navigate a world where
marketplace now has a growing a deadly pandemic has undercut
catalogue of millingmachines, 3D their core proposition? What is the
printers, label makers and such future of a sharing business when
As Airbnb chief executive like. “This is going to be the sharing something with a stranger,
Brian Chesky said last year: future,” he says. “The more assets be it an enclosed space or a
“It felt like everything was we share, the better it is for the basketball, can lay you low with a
breaking at once business community and the more potentially fatal disease?
sustainable it is.” Sundararajan is optimistic. He
believes that, despite the huge hit
Go forth and multiply from the pandemic, the sector will
The rise of the sharing economy not only rebound, but thrive. And
was a dominant theme in the he points to three factors behind
decade before the pandemic. his conviction: technology, trust
Airbnb is valued at around and economics.
$110 billion on Nasdaq, which is Technology is the most obvious.
more than Marriott, Hilton, Hyatt More than 4 billion people are
and InterContinental Hotels walking the earth with a
combined, yet it doesn’t own a GPS-enabled smartphone, a
single hotel room. device without which much of the
Similarly, Uber has a market sector would simply not exist.
24Analysis | In sharing we trust
•
Lockdowns have thrust them even
more to the centre of modern
life, and this leads to the second,
arguably more important
factor: trust.
Secret fuel
Our faith in digital services has
been building since the
mid-1990s, when eBay and
Amazon introduced the star-rating
system for buyers and sellers. As
Sundararajan explains: “Getting
into a stranger’s car, sleeping in a
stranger’s spare bedroom, having
someone handle a food order –
these are things that require a little
more trust. But as we have read
more Yelp and TripAdvisor
reviews, as we have spent more
time on Facebook and LinkedIn,
the population has tacitly
become more confident using a
digital interface to make
consumption decisions.”
Trust was the secret fuel that
powered the rise of the sharing Cash-strapped companies
economy – but it almost
were intrigued by the idea of
evaporated as Covid-19 spread
squeezing more revenue out
and lingered.
of machines that were
Passenger journeys at Uber fell
otherwise sitting silent
by 80 per cent, forcing boss Dara
Khosrowshahi to lay off a quarter of
the workforce. BlaBlaCar, the
French carpooling service that
offers rides in 22 European
countries, put half of its staff on
part-time work and suspended its
bus service amid France’s second
lockdown in November. Airbnb
was forced into a multibillion-
dollar emergency fundraising and
laid off workers as bookings
disappeared. As chief executive
Brian Chesky said last year: “It felt
like everything was breaking
25• Analysis | In sharing we trust
Side hustles will become at once.” to look their best, and spending
more important, whether it’s Ambika $50 a month on a designer clothes
a factory renting out a Singh, the subscription is cheaper than going
ziplock bag maker for $45 founder of on a shopping spree, at least for
an hour or an out-of-work Armoire, had a her target market.
dog lover signing up on similar experience. Crucially, too, trust is coming
Rover.com, a marketplace for Armoire, a back. As public knowledge of the
subscription clothing virus and how it spreads has
overnight dog boarding
rental business for profes- grown, customers have become
sional women in Seattle, more discerning. They are more
had been growing at a rate of willing to take dry-cleaned clothes
knots. The five-year-old start- from a rental business because
up had its best-ever month in they are probably cleaner than,
February 2020, but, when the say, a frock in a high-end boutique
lockdowns started, everything that has been handled and
stopped. New subscriptions dried breathed on by countless patrons.
up and cancellations rocketed. BlaBlaCar, which instituted
stringent hygiene guidelines and
True believers an “only one in the back” feature
“It was extremely traumatic,” says on its app, has seen a surge in
Singh. “It’s not an exaggeration to rides as people have begun to opt
call this Armageddon for a for sharing a car with a single
business like ours, which targets stranger, rather than a train
the working woman and is carriage full of them.
dressing her for the workplace. We
weren’t sure whether that customer Side hustles
would continue to be relevant.” The final piece in the sharing
What saw the company jigsaw is economics. Jared
through, however, was a core Isaacman, founder of Shift4
group of customers who had used Payments, a payment processor
the service for at least nine months used by more than 200,000
– Armoire’s true believers. businesses, says: “We don’t
“Without them, we would have have a single customer that’s at
been dead,” Singh says. They kept 100 per cent. Every one of them
paying, but instead of pencil skirts has been set back.”
and trouser suits, they started Indeed, for many businesses,
renting tracksuits and high-end the road back from the pandemic
loungewear. will not be a straight line. Business
will be different. Side hustles will
Discerning customers become more important, whether
Armoire has not recovered to it’s a factory renting out a ziplock
pre-pandemic sales, but Singh is bag maker for $45 an hour or an
confident that it will emerge out-of-work dog lover signing up
stronger as the world returns to on Rover.com, a marketplace for
normal, not least because when overnight dog boarding. The
offices do reopen, people will want US-based company intends to
26Analysis | In sharing we trust
•
float this summer with a
$1.6 billion valuation, via a
merger with a special purpose
acquisition vehicle.
Restaurants rejigged
The restaurant industry might
also be changed for ever. “I don’t
think a lot of restaurants are going
to come back in their pre-pandemic
form; we’ll see a lot more
delivery-only businesses,”
Sundararajan suggests.
That bodes well for the likes of
Uber, which has refashioned itself
Crucially, trust is coming back. As public
into a delivery business by
knowledge of the virus and how it spreads has
snapping up DoorDash, a food
grown, customers have become more discerning
delivery app, and alcohol delivery
service Drizly.
This is a trend that a number of
“dark kitchen” start-ups are betting renters. The incident was splashed customers comfortable enough to
on across Britain and the US, with across the media within days. try something different – like, say,
companies offering space for “Will criminals kill the Airbnb handing your dog to a stranger for
delivery-only operations on model?” asked one headline. the weekend.
monthly or even daily contracts Chesky responded by offering a And technology advances
that cost from about $30 an hour. $50,000 liability guarantee to apace, exposing more industries to
hosts – and added his personal disruption. The collapse of solar
Cultivating trust email address. He said that the panel prices and improvements to
The sharing economy still has decision, a risky one for a young battery technology mean that local
obstacles to overcome, however. start-up, “changed the company energy exchanges can be set up in
The UK Supreme Court ruled in for ever”. developing countries such as
February that Uber drivers were in That decade-old episode is India, where the electricity grid is
fact “workers” entitled to paid telling. Airbnb has spent years not reliable.
holiday and the minimum wage, cultivating a deep level of trust And better webcams enable
not independent contractors, as with its customers because it is people to verify their identity by
the ride-hailing giant has long elemental to the business. holding up their driving licence,
argued. The ruling could inspire The same goes, with varying which has been critical for say,
other sharing economy contractors degrees of success, for Uber, alcohol delivery, as well as the rise
to file similar suits in an effort to Armoire and countless other of digital notaries. At the heart of it
rebalance benefits that sharing companies. all is what Sundararajan calls the
campaigners claim are skewed “invisible infrastructure” of
toward the companies. Invisible infrastructure sharing economy companies:
The industry must also regain Trust is the sector’s currency, so it trust. For many industries, Covid-
the faith of customers and is perhaps better primed than 19 destroyed it. Those that can
suppliers alike. Back in 2011, an traditional businesses, which regain it are likely to reap the spoils
Airbnb host’s home was trashed by aren’t so laser-focused on getting as the pandemic recedes •
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