Back to Nature, the Dubai-based biodegradable packaging products start-up, is on a fundraising drive to scale-up its operations amid the fast rising trend towards “sustainable” living and following Abu Dhabi’s move to ban single-use plastic products in the emirate.
The start-up, founded by the engineers-turned-entrepreneur sisters Ranjisha and Ranjitha Raghav, is currently seeking around AED5 million from UAE-based high-net-worth-individual (HNWI) investors. The founders said they’re in advanced stage discussions with potential investors.
The latest round of talks for investments comes as the start-up struck a partnership with a consortium of UAE-based professionals-turned investors earlier this year.
“Currently we are engaged in advanced discussions with some UAE national investors,” Ranjitha Raghav, co-founder and CEO of Back to Nature, told Arabian Business.
“We also have plans to approach some of the private equity (PE) investors soon to raise more investments to fund our expansion and backward integration plans being finalised now,” she said.
Ranjitha, however, declined to disclose the identity of the prospective investors because of confidentiality issues.
Ranjitha Raghav, co-founder and CEO of Back to Nature
She said the venture’s backward integration plans, envisaging setting up a manufacturing facility in the UAE to produce biodegradable and sustainable products – which would be the first of the kind in the country – alone is estimated to require an initial funding of about AED5 million.
“The current talks are for tying up this funding requirement.
“Once this deal is closed, we will approach some of the PE investors for more funds to finance our proposed scale-up plans – both in manufacturing and market operations – to meet the ever-increasing demand from the Middle East region,” Ranjitha said.
She also revealed that Back to Nature has finalised a financial-cum-strategic tie-up deal recently to tide over the cash-flow and operational challenges faced during the pandemic.
“The pandemic provided its fair set of challenges for our start-up but we were fortunate to garner the interest of a consortium of like- minded investors,” she said, without disclosing the amount of funding.
The consortium of investors included Vikas Attri, an ex-CEO-turned-co-founder of another Dubai-based start-up Pedalo Gelato, Rahil Taneja, the former financial markets head for Africa and Middle East at Standard Chartered and a leading Africa-based FMCG entrepreneur.
Ranjitha said the venture’s ambitious expansion plans are also based on the reported moves by Abu Dhabi and also leading organisations like the Dubai Intenational and Dubai World Central airports and Emirates to ban single-use plastic products.
“We are heartened and excited about these moves [of Abu Dhabi, Dubai airports and Emirates]. We, therefore, encourage more and more businesses to make responsible shifts as a significant number of consumers these days prefer brands that uphold environmental and ecological sustainability.
“Eventually, we hope to contribute towards building a circular economy, wherein the compostable products will be collected and brought to a natural composting facility and provided as manure to the local organic farms within the UAE,” Ranjitha said.
Currently, Back to Nature caters mainly to restaurant chains, hotels, catering services and supermarkets with biodegradable packaging products made from agro-waste and renewable resources like sugarcane bagasse and bamboo pulp, sourced from India and China.
The start-up, founded by the engineers-turned-entrepreneur sisters Ranjisha (L) and Ranjitha Raghav (R)
“We are also working with one of the largest supermarket chains in the UAE. We are currently collaborating with businesses participating in events like Expo 2020 Dubai where the core value of the initiative is focused on sustainability,” Ranjitha said.
On the proposed expansion plans, Ranjitha said: “Currently our operations cover the entire UAE market. We plan to expand to some of the other GCC markets by the end of this year.”
According to sector experts, the UAE’s food packaging industry is projected to log in record growth over the next few years on the back of the pandemic changing consumer trends, leading to a surge in online orders for food, fresh fruits, vegetables, meats and poultry.
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