Fashion brand Veronica Chou supports green innovations, such as clothing made from agricultural waste, in an industry that generates 20 percent of the world’s wastewater and 10 percent of its carbon emissions.
By K. Oanh Ha / Bloomberg
While she was running a company selling US clothing labels in China, textile heiress Veronica Chou (曹穎惠) was a world-traveling executive who made headlines for the 2012 socialite lifestyle and luxury wedding in Hong Kong. Now, she’s trying to clean up the fashion industry.
A member of the US $ 2.7 billion family empire built by his father Silas Chou (曹其峰), the 36-year-old says he is now devoting his time and money to startups that make one of the world’s most wasteful industries more sustainable.
In 2015, after selling the family’s stake in a Chinese joint venture with New York-listed Iconix Brand Group Inc for US $ 56 million, he started his own green label, supporting suppliers using innovative technology to make materials and clothing.
“I completely changed my lifestyle and behavior,” said Veronica Chou, mother of five-year-old twin boys. “We have to see how to reduce consumption and make things that don’t harm the planet, but we have to consume it; we need to dress ourselves. “
It’s a bold bet. Sustainable fashion is part of the $ 1.8 trillion global apparel industry, which has ballooned over the past decade amid a booming low-cost, fast-to-market clothing championed by the likes of Zara SA and her father.
However, Veronica Chou joins a growing list of startups seeking to become buyers concerned about their impact on the environment, market ResearchAndMarkets.com says will grow to US $ 8.25 billion by 2023.
The fashion business generates 20 percent of the world’s wastewater and 10 percent of carbon emissions – more than all international aviation and maritime shipping combined, says a UN report.
It takes about 7,571 liters of water to make ordinary jeans, while the equivalent of one textile dump truck is sent to landfills or burned every second.
“The industry loses its own sustainability target by a mile unless it changes course,” said senior partner McKinsey & Company Inc. Karl-Hendrik Magnus. “This creates huge profits for brands and small players who are focused on sustainability.”
About 66 percent of consumers surveyed in the McKinsey study said they consider sustainability when making a luxury purchase.
However, only 31 percent of Gen-Z and 12 percent of baby boomers are willing to pay more for sustainable products, the consulting firm said.
Big brands are starting to respond, with Zara Inditex SA this year pledging to use 100 percent sustainable fabrics by 2025.
Hennes & Mauritz AB previously committed to do so by 2030.
However, it is difficult to decide which technologies and materials will work.
“It’s still unclear which of the many great innovations on the market will scale and become dominant,” Magnus said.
Everybody & Everyone brand Veronica Chou offers clothing such as blazers made from fermented agricultural waste, or casual pants woven from pulp-based fibers that use 50 percent less water and produce half the emissions of synthetic equivalents.
He also encourages his family to invest in startups that offer solutions to climate problems.
“There are very few people out there who legally put their money where their mouth is when it comes to sustainability – Veronica is one of them,” said Niall Dunne, chief executive officer of UK-based biodegradable plastic maker Polymateria Ltd, which the Veronica Chou family is investing in. come in. “There’s a lot of greenwashing. He’s got green credentials and knows how to do it. “
Grandpa Veronica Chou started one of the largest knitwear companies in Hong Kong, South Ocean Knitters (南洋 針織 公司). His father later changed the family business with initial investments in Tommy Hilfiger and Michael Kors.
After earning a degree in communications and business from the University of Southern California, Veronica Chou used Iconix to bring US brands including Badgley Mischka and Madonna’s Material Girl to China.
She became a regular in the celebrity gossip media, appearing in photos with Britain’s Princess Beatrice and supermodel Naomi Campbell. Her Hong Kong marriage to a Russian businessman includes a custom-made replica of a Russian palace overlooking the region’s famous port.
Born in Hawaii and mostly based in London, Veronica Chou is tackling the COVID-19 pandemic in Hong Kong and says she is not the fashionista the magazine imagines.
She said she offset all the carbon emissions from her travels and bought vintage clothing to promote reuse.
He is also encouraging more sustainable investment in his family portfolio, which includes early and early stage start-ups in telecommunications, media and technology through Novel TMT Ventures, an investment company run by half-brothers Veronica Chou, Bruno and Luis Chou who own more than US $ 70 million under management, according to Crunchbase.
Veronica Chou said the number was much higher now, but refused to disclose it.
She joins her father, brother and sister on a weekly video conference call to discuss the “all-round deal” they come across.
In a typical week, they might see 30 companies – reflecting an increase since the pandemic, he said.
“I will ask what this potential investment does about packaging, what about renewable energy,” he said.
His family has given up most of the fashion holdings that formed the foundation of Chou’s wealth and is now focused on investing, he said.
Its sustainability focus helps direct family investments to start-ups such as Rent the Runway, which leases designer clothing and is valued at US $ 1 billion following investments from Franklin Templeton Investments and Bain Capital Ventures.
The family also invested in The RealReal Inc, a consignment platform for second-hand luxury goods that is now listed with a market value of US $ 1.2 billion.
Novel TMT is also investing in Modern Meadow, which uses biotechnology tools to grow skin in the laboratory. Veronica Chou, herself, is an advisor to New York-based start-up Perfitly, which lets shoppers try on clothes with custom 3D avatars that save significant profits.
He said the family investment could be as small as US $ 50,000 or more than US $ 5 million in equity, with the aim of making multiple profits through the offering or sale of public shares.
“It’s profit with a purpose, not charity,” said Veronica Chou, who is also director of Karl Lagerfeld Greater China and continues to be an investor in the brand’s global business.
He says he sometimes funds companies his family rejects, investing in previous seeds and round A.
He is looking for material science or innovation that is “regenerative” for the planet, has gone through the research and development stage and is heading for commercialization. The investment timeframe is five to 10 years before going out.
“I became more excited about the previous one. They are more innovative, “he said. “We want to make sure this technology is developed and used to its fullest if we are to make an impact in the world. It cannot only be accessed by the elite. “
Veronica Chou’s Everybody & Everyone line debuted late last year but was withdrawn after the pandemic started and was relaunched in September with a “Work From Home” line featuring comfortable pants and tops made of biodegradable eucalyptus fibers.
Some shirts are made with recycled silver lining, which is supposed to have anti-microbial and odor repellent properties. The brand also offers a $ 32 T-shirt made from used cotton and marine plastic.
To help people reduce the size of their wardrobes, Veronica Chou offers clothes that can be adapted to different seasons, such as the US $ 288 calf-length puffer jacket made of 330 plastic water bottles that can be unzipped and worn short in warmer weather.
All items are available in sizes 00 to 24, a range rarely offered by big brands, inspired by Veronica Chou’s “irregular eating” habit as a young woman when she and her friends strive to look like super models.
While her father runs the factory, Veronica Chou doesn’t own it. The brand is aimed at US consumers, and sales come from every state, he said.
“Young consumers care about the planet and care about justice, whether it be women’s rights, racial equality or climate justice,” he said. “There are conscious consumers who are willing to pay less for products that support their values.”
While the number of small, eco-conscious brands continued to grow, most were lacking Veronica Chou’s resources.
“This is a competitive advantage,” said Janine Stichter, vice president and specialty retail analyst at Jefferies Group LLC. “The only companies we saw developing technological innovation in the industry were big companies, like Nike. Not many start-up brands can do this. “
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