In this edition of Lived It, we sit down with longtime investor and champion of sustainable businesses, Carol Newell. Heiress to the Newell-Rubbermaid fortune, Carol founded Renewal Partners as a vehicle to activate her inheritance as purpose-driven capital. Her focus became funding a new wave of businesses who were integrating the planet into their bottom line. Together with Joel Solomon (author of The Clean Money Revolution) and her team at Renewal Partners, Carol has done deals with over 150 companies, both big and small.
News of Renewal Partners’ work began to spread and soon others wanted to know how they too could impact invest. With Paul Richardson, Carol and Joel co-founded the mission venture capital firm, Renewal Funds. The firm gives LPs the opportunity to invest in a portfolio of early growth stage social enterprises in Canada and the United States.
Carol has received several awards, an honorary doctorate in Humane Letters from St. Lawrence University, and was appointed a Member of the Order of Canada in 2007. Despite her success, Carol is contently down-to-earth. A modest angel investor and steward of our planet, Carol is a living and breathing example of how angel investing can be a vehicle for change.
Hometown: Ogdensburg, New York
Education: Bachelor of Science in Geology
First Job: Waitressing and then eventually geologic field work.
Work Attire: Casual. Typically, leggings paired with Fluevog boots or Blundstones.
Currently Reading: The Joy of Living by Yongey Mingyur Rinpoche
Hobbies: African drumming!
Angel investors she admires: Sallie Calhoun and Esther Park of Cienega Capital
Having already started a philanthropic foundation and with additional capital to deploy, Carol knew exactly the next logical thing to do. “I wanted to invest in ways to move forward companies I felt were creating a smaller footprint and reducing pollution. It made sense to invest in and promote companies that were creating solutions instead of more problems to solve.”
She allocated a pool of capital, and invited Joel Solomon to invest it in a mix of businesses. Some were companies that were already up and running but a lot were just getting off the ground.” Vancouver’s entrepreneurial climate at the time is remembered by Carol as ripe for engagement. “Several businesses were advancing unusual ideas and it was a prime time for them to receive recognition, capital and mentoring.“
While there was a drive to invest in green and eco-friendly businesses, terms that had not yet been popularized (in the business world) at the time, Carol admits that her motivation stemmed more from environmental dismay than excitement. “I was concerned that businesses also had the potential to drive the train – with supreme diligence and focus – in the wrong direction! When I started looking at different companies and at the different ways we as human beings interact with the environment, it just didn’t make sense to me. I began to realize that our lifestyle could never be long lived, that it was more of a flash in the pan. I felt we needed to be stewards of the land, and that purpose-driven investing could be one of the ways to do that. “
Despite her active role in financing businesses, Carol didn’t actually start using the term ‘angel investing’ until later in her career. “I didn’t even know about angel investing until I was long into it,” she admits, revealing other terms she uses instead. “Really what I call it is purpose driven capital. Or my cache of Mission Money. It was money invested specifically to help stimulate change as opposed to simply making more money. (It’s true, this was a guideline I could afford to use because I realized early on that I already had enough for myself.)”
Once environmentally-driven businesses had become Carol’s focus, her team began a process she calls “digging in,” a strategy many other investment groups use. “Dig-in on a specific issue area,” she advises. “If your focus is to support or re-energize farming, for example, ask: how can you solve the pressing land ownership conundrum, or drive capital into farmer’s markets and food markets?
“For example, the founder of SPUD (a Renewal Fund’s portfolio company), David Van Seters, noticed he was selling a lot of kale imported from the US. He broke that market open for BC farmers by promising if they planted it, he could guarantee sales. I similarly asked myself, ‘in what ways can we help shift the culture out of processed foods and create businesses that are more about…juices?’”
This was the line of thinking that led Carol’s team to one of her first investments: Happy Planet Juices. “It turned out we were ahead of the game in so many ways,” she comments, pointing out what a huge industry juice has become.
“We placed a lot of patient capital over a long period of time,” says Carol, reminiscing on the ah-ha moment that came from meeting other investors and their style of investing. “I began to realize my expectations looked different than their expectations.”
“Their expectations seemed to be to maximize profits. They were looking for really high rates of return – and fast!” Carol identified her approach as more of an “old school business” style.
“The Newell Company of my mother and father and grand, and great-grandfather’s generations was about small town business. Our family supported and gave back to the local the community,” Carol explains. “My thinking is to support the purpose-driven local entrepreneur for the long term. In my ideal world, companies would be built and grown to create products, solid cash flow, and meaningful work, rather than to create momentous exits. Outside investors would be less demanding, more patient, and more locally connected, too. I think of it as cycling the energy round and round, giving back to the place you feel rooted in.”
Rather than mentoring entrepreneurs, Carol engages with other investors aligned with deploying purpose driven capital. One of the ways in which she does this is through Play Big. “Whether they’re investing in businesses or non-profits, I feel it all amounts to a profound investment toward a healthier future.”
Carol began speaking openly about wealth activism and encouraging others to use investment as a means to achieve a more balanced economy. For Carol, building a balanced economy includes finding ways for investors to loosen the reins, welcome their unique opportunity to weather risk more easily than most, and consider that being a part of fueling work and a workforce that benefits everyone might be its own reward well worth risking for. She feels it is important to take a look at power dynamics and how they influence the well-being of people and the investments themselves.
“We’re stuck in a peculiar cycle of expectations and obligations,” Carol explains. “Funds that pool investor’s capital are beholden to get a decent return. People have come to expect downright exciting returns, whether they’re high, fast or both. And it can be a thrill. But it can also force fund managers to sell earlier than they’d prefer, in order to meet the five year turn-around they promised. Sometimes the entrepreneur who has put their life’s energy into this business gets the rug pulled out from underneath them, or are forced to sell when they didn’t really want to sell.”
“I’m a patient investor, however I am interested in getting the capital back so that I can make it available again, recycling it into the next business.
“I don’t want to force someone into an early exit. There are a lot of investors who feel duty bound to do so… the Siren call of “business” and what it should look like is compelling. I don’t want to drive the entrepreneur or the business to perform at some unsustainable level. I think it’s time to remake business. It’s about listening into the past while listening into the future. I feel called toward balance and sustainability. I think investments in fields with these goals will yield us all a better return in the long run.”
Carol’s start as an investor was particularly difficult for one main reason: her introvertism. “I am not the networker,” she reveals. “I am not out there engaging with people. In the beginning, Joel found all the investments. More recently, I appreciate recommendations and due diligence from several folks. They might share their research, saying, ‘we can’t invest – it’s not the right fit for us – but it’s very interesting…’ Sometimes it’s a great fit for me and works for everyone. The entrepreneur gets capital for a worthy venture and the hard work of assessing businesses gets utilized.
“Now that I’m fully invested, my occasional private placements are more about something that intrigues my sensibility, or might make a real difference, and a person or team with proven ability to accomplish what it is they want to do. “I’ve given myself permission to support the concept first, not the financial value of the investment. ”
Carol has been hard at work for the last several years developing a five deck card set called ReWeaving Wealth. The cards help people activate their resources to make a difference by guiding them through the creation of an investment thesis. The cards help answer the question:
“Your money is hard at work, 24/7.
Is it working on what you want?”
Investors interested in following updates on the release of ReWeaving Wealth can opt-in to the announcement here.
“If entrepreneurs and investors use the triple bottom line: profit, people, planet -as their guiding principle, chances are we’ll be automatically building a safer, healthier, happier world for everyone.”