Food waste rules set to double turnover at packaging firm

COMPOSTABLE food packaging firm Vegware expects to more than double its turnover to £10 million in the next two years following the introduction of regulations to slash the amount of waste Scotland sends to landfill.

From January 2014, food businesses that produce more than 50kg of food waste a week will have to make sure 
it is separated from other materials for recycling, with smaller firms having to comply with the new rules from 2016.

Lucy Frankel, communications manager at Edinburgh-based Vegware, said: “We’re helping people comply with the new legislation through our Food Waste Network project, which helps every UK company find out how to ­recycle their food waste.”

The firm expects to generate £4m in turnover during its current financial year, up from £400,000 in 2008, and Frankel said the forthcoming regulations are a “huge opportunity” for the business.

She added: “We’re seeing enormous growth, not just in Scotland but across the UK and internationally, and are aiming to get to £10m turn­over within a couple of years.”

Vegware specialises in ­plastic-free packaging that can biodegrade completely within 12 weeks under industrial composting conditions. It was founded by Joe Frankel and Dominic Marjoram in 2006 and employs 22 staff, most of whom are based in Edinburgh, with a small number in London and Denmark.

The company has been highlighted as the type of “socially motivated” firm that may be targeted by a new venture 
capital trust (VCT).

The Social Impact VCT will be jointly managed by investment group FSE and not-for-profit organisation Social Finance. They are looking to raise up to £20m to invest in social enterprises and other businesses that aim to make a positive difference to communities while delivering a profit.

Social Finance director ­Annika Tverin said: “We’re creating an investment opportunity that looks at financial return and social impact. The VCT structure will make an interesting proposition for those looking to achieve more than just a ­financial return with their ­investment.”

Jeff Dober, head of debt funds at FSE, said: “These are businesses like any other that need to make money, but it’s profit with a purpose.”

The VCT has a minimum subscription of £2,000 and offers income tax relief of 30 per cent, while dividends and capital gains will also be tax-free.

Frankel said: “This funding model is an opportunity for 
investors to put their money where their morals are.”