How The Craftory Is Pioneering A New Era Of ‘Cause Capitalism’: An Interview With Elio Leoni Sceti

Elio Leoni Sceti, the Co-founder and Chief Crafter at The Craftory | COPYRIGHT DAVID ROWAN www.davidrowan.org

The Craftory, a pioneering investment firm known for its commitment to purpose-driven consumer goods, is reshaping the investment landscape by integrating social and environmental impact with financial success. Founded with a vision to champion brands that not only excel commercially, but also contribute positively to society and the environment, The Craftory continues to lead with its innovative approach to 'Cause Capitalism.'

I caught up with the indomitable Elio Leoni Sceti, the Co-founder and Chief Crafter at The Craftory, to discuss the company's investment philosophy, his perspective on the enduring relevance of cause capitalism, recent successes, and future outlook. Sceti is also an Independent Board Director at Kraft Heinz and E.P.S. (Eugénie Patri Sébastien), the Luxembourge-based holding company of ABInBev shareholders.

Sceti expressed unwavering confidence in the concept of cause capitalism. Despite the politicized challenges to ESG (Environmental, Social, and Governance) criteria in the United States, Sceti remains optimistic about the impact of investing in purpose-driven companies and believes that cause capitalism is the future. He asserted, “Successful companies today and tomorrow are and will be those that have ‘doing good and doing well’ ingrained into their core values.” 

Sceti's commentary highlights that The Craftory is not anti-capitalist, anti-FMCG, or anti-consumerism, but believes that there is a significant opportunity for the consumer packaged goods (CPG) sector to make a difference at scale and, in the absence of government leadership, for brands to step up and play a meaningful role, environmentally and socially. 

“Consumers want choices - choices that meet their needs and also deliver for people, planet, and society. Conglomerates are failing to achieve this. Cause-capitalism and purpose-driven brands are the only alternative that can deliver,” Sceti noted.

Edgard & Cooper's mission is to revolutionize nutritional quality in the pet care category through a zero tolerance approach to nutrient poor, hyper-processed ingredients. | The Craftory & Edgard & Cooper

A prime example of Craftory’s successful investment strategy is the recent sale of Edgard & Cooper, a Belgian pet food brand, to General Mills which will take the brand to more global markets and enable even more consumers to access their products. Throughout three and a half years, The Craftory facilitated a five-fold increase in retail sales for Edgard & Cooper, guided the company through Series B and C funding rounds, and supported its social goals, including a 70% reduction in carbon emissions.

Sceti emphasized, “What was a small Belgian retailer is now a pan-European brand, and in that time the team has delivered to its social goals, too: reducing its carbon emissions by 70% and, through its animal welfare foundation, helping nearly 200,000 cats and dogs all over the world.” He added, “At The Craftory, we believed in this brand, the team, and their core mission: to revolutionize nutritional quality in the pet care category through a zero-tolerance approach to nutrient-poor, hyper-processed ingredients.”

Hippeas is committed to organic, GMO-free, MSG-free, gluten-free, and vegan snacks.  | The Craftory & Hippeas

Craftory's investment portfolio includes several noteworthy companies. One such investment is Hippeas, a brand committed to organic, GMO-free, MSG-free, gluten-free, and vegan snacks. The Craftory led Hippeas’ $55m funding round and has been impressed by the achievements and progress made by the team since they entered its portfolio. Hippeas uses organic farming practices to create healthier, tastier snacks. Through supply chain optimization and product innovation – such as the launch of Flavor Blast – they’ve now added 1,000 basis points to their gross margin since Craftory’s initial investment, and continue to grow at pace.

Dropps, known for its original liquid laundry detergent pod, is another key portfolio company. The Craftory supports Dropps as it scales its zero-waste product lines and expands its market presence. Since joining The Craftory’s portfolio, Dropps has successfully transitioned from a direct-to-consumer model to an omni-channel retail presence, reaching significant distribution through Amazon, Walmart, and Wegmans.

Seed, a brand specializing in vitamins and supplements | The Craftory & Seed

Seed, a brand specializing in vitamins and supplements, also represents a significant investment. Craftory’s $32.5 million investment in Seed’s Series A round in 2021 has contributed to the brand’s more than eightfold growth since then. Seed’s success highlights its innovative approach to microbiome health and its commitment to both human and planetary wellness.

The Craftory’s commitment to societal impact is reflected in its rigorous due diligence framework, which balances cause and economics equally. “Our number one criterion is that our target company must have a positive impact on people, the planet, and society. We’ve built our due diligence framework in which cause and economics are valued equally. This might be more common practice now, but this is something we’ve been doing from the very start of our journey,” Sceti shared. 

As a trailblazer in this field, The Craftory was the first global, purpose-led consumer goods investor to achieve B Corp certification. Additionally, the firm is certified as carbon negative, plastic negative, and a Diversity VC-rated investor, and works with several measurement platforms to ensure it’s doing all it can to live up to the ideals it has set. Through its portfolio companies, The Craftory has collectively saved over 10 billion liters of water, 170,000 tonnes of CO2, and 11.5 million pieces of plastic from landfills.

Through its portfolio companies, The Craftory has collectively saved over 10bn liters of water, 170,000 tonnes of CO2, and 11.5m pieces of plastic from going to landfill. Some of Craftory’s partners’ project highlights include Hippeas, who have led a regenerative agriculture program in Canada since 2023 – and Edgard & Cooper – who launched a vegan pet food range that has saved up to 375 tonnes of carbon dioxide equivalents. 

For purpose-driven entrepreneurs considering a partnership with The Craftory, Sceti offered clear advice: “We prioritize brands with strong teams, doing business in growing sectors, with leading category margins. We place great value on quantifiable brand power, a well-thought-through consumer-relevant USP (“the blade”), and a clear, timely purpose.”

As The Craftory continues to champion disruptive, purpose-driven brands, its approach to cause capitalism sets a high standard for integrating social and environmental considerations into core business strategies.