ET Edge Insights spoke to Chetan Kasim, Co-Founder and CEO of Sustainext, who unveiled the company’s vision to achieve a revenue milestone of USD 35 million by FY 28. As he delved into the intricate ecosystem of Sustainext, a groundbreaking joint venture between Valenta AI and VNV Advisory Services, he shed light on the innovative SaaS-based platform driving end-to-end ESG solutions.
Can you provide insights into Sustainext, its affiliated brands, and the underlying business model?
Sustainext is a Joint Venture between Valenta AI and VNV Advisory Services. Valenta is a Global IT Services Company that specializes in Digital Transformation and VNV is a Global Sustainability Consulting Firm that specializes in Carbon offset Projects. Identifying a Gap in the Sustainability Software sector for ESG Data Management and Reporting, Valenta and VNV joined forces to create Sustainext which is a SaaS-based Platform and an Ecosystem for End-to-End ESG.
Sustainext is a SaaS-based ESG Platform that helps organizations of all sizes and sectors with their Sustainability Data Management and Reporting requirements and makes the entire process right from Data Collection to analysis, reporting, optimization and tracking an absolute breeze. Using the best of Automation, AI, and Analytics, the Platform offers organizations and users a seamless, simplistic, and holistic experience.
Could you share performance metrics from the previous year, such as turnover and year-on-year growth figures?
Sustainext has seen significant growth across various markets since inception and is on track to achieving revenues of USD 1.8 to 2 million during FY 25. The company targets to grow its revenues to USD 35 million by FY 28. While the bulk of the revenues between 2024 – 2028 will come in from North America, the UK, the EU, and Australia, the company expects to see significant traction from Markets across the LATAM, APAC and MENA post that.
As more supply chain disclosures become mandatory for organizations operating in the developed economies, the emerging markets that supply to the developed economies will also be required to report on their ESG performance as a mandatory requirement and this will lead to massive growth within the ESG Software Sector.
Sustainext will be raising capital to fuel its in-organic growth via strategic acquisitions globally and look to strengthen its consulting capabilities across various Sustainability Domains.
From a Partnership Perspective, Sustainext targets to on-board approx. 250 Partners between 2024 – 2028 to manage its Distribution.
What industry challenges and opportunities are prevalent amidst current market trends?
Sustainability is no longer a good initiative within an organization and has gone way beyond traditional CSR activities over the past few years. The transition from CSR to ESG is in full swing across several organizations globally and the Rise of ESG is taking center stage. Some of the biggest challenges organizations face while embarking on their Sustainability Journey are limited readiness and skillset, executive buy-ins, scattered data, lack of awareness, manual processes and myths that surround Sustainability and due to all these factors, the adoption has been slow up until now however that is changing rapidly.
Recent climate events have forced governments across the world to act on Sustainability Initiatives and put in strict measures that require organizations to switch from fossil fuels to renewable energy sources, move towards electrification, and implement sustainable business practices including reporting to create more transparency and accountability including sustainable supply chains.
All this has led to the creation of the Climate Economy which is now powered by a combination of Hardware and Software providers who are working in tandem to help organizations decarbonize and achieve Net Zero Goals. True Sustainability however requires organizations to go beyond Emissions and focus on all aspects of Environment, Social and Governance Metrics.
Could you outline key milestones achieved thus far and highlight notable partnerships within your portfolio?
Sustainext is a Partner-driven organization. We understand the importance of Partnerships, be it Resellers and Implementation Partners, Frameworks and Standards, Technology Partnerships, Audit and Assurance Partners, Consulting Partners and Strategic Partnerships including Academia.
Having incorporated in 2022, Sustainext has 4 Global Entities across India, Canada, UK, and Australia and over 55+ Partners across 20 Countries.
While Sustainext is a Startup, it leverages the expertise of its JV Partners that have helped it operate as a Global Professional Company since its inception. With utmost importance given to Data and Security, Sustainext is globally compliant with leading industry standards and certifications that allow it to integrate seamlessly into Enterprise environments and allow Small and Mid-Size organizations to start their Sustainability Journey without having to invest significant amounts of capital upfront.
Sustainext continues to deploy its Platform across various Sectors ranging from Manufacturing to Financial Services, Education, Retail, Hospitality, Real Estate, Construction, Mining, IT and Software and more. Being Industry and framework-agnostic with AI-powered modules, the Platform offers a simplistic user experience with the most advanced modules that let users create What-if scenarios, Net Zero and Science Target Simulations and track key ESG Metrics locally and globally in real-time.
With a Diverse clientele ranging from Fortune 500 Companies to Local SME Players, Sustainext has proven to be a one-stop shop solution for companies globally offering scalability and flexibility.
Could you outline your growth strategies encompassing financial, geographical, and operational expansions?
Sustainext has set very ambitious yet realistic goals for the future. The Firm’s Mission is to Empower Business Sustainability by Simplifying Decisions through Technology, Innovation, and Collaboration.
Being Bootstrapped for 2+ years and having achieved significant growth both in terms of clients and partners globally, the firm is now planning to raise its first external round of funding to allow it to deploy more capital and resources across all the markets that it currently operates in and support the distribution partner channel with more marketing ammunition.
With 3 Delivery Centers across India in Bangalore, Delhi, and Mumbai, the firm employs over 45+ permanent full-time employees and is planning to expand the Core consulting team across various markets to handle more complex areas of ESG and local regulatory reporting requirements.
The idea is to do more with less and offer solutions that go beyond the core platform, be it standalone consulting, ESG staffing solutions, training solutions, carbon credits, benchmarking, ratings, climate risk assessment and much more that cannot always be handled through the platform but require focused and experienced consulting to go the entire distance.
At Sustainext, SaaS is not just Software as a Service but Sustainability as a Service.
How do you foresee the market landscape in 2024 and your outlook on future industry trends?
The Market for ESG Disclosures and Reporting is set to grow rapidly in 2024. With more countries introducing stricter norms and guidelines for reporting, companies need to embrace technology to comply with these standards and make their internal processes more robust and efficient.
While Penalties do not apply for lack of disclosures or reporting in a certain time frame just yet, large listed organizations globally do need to provide limited assurance and the more seasoned companies are also looking at integrated reporting combining both Financial and Non-Financial performance and more than penalties, organizations are facing pressure from customers, investors, and even employees who are demanding for increased transparency on Sustainability initiatives and want to be associated with firms that are taking serious action on ESG.
Are there any plans underway to broaden your portfolio, and if so, could you elaborate on them?
Absolutely. While the Platform today is very comprehensive and covers all aspects of E, S, and G metrics and helps Automate the Data Collection Process, uses AI and ML to create detailed scenarios and modelling for future trends and predictions and advanced analytics to provide intuitive visualizations via dashboards in real-time across several key components, reduces the reporting process from months to days and captures data across the value chain, there is still a lot more that needs to be done to make Sustainability more accessible and get everyone more engaged in the entire process.
As a Digital-first company, we are working on our Mobile Application which will make it easier for organizations to provide access to all employees which can also lead to gamification of ESG across different departments and locations. This will also make employees more accountable for their actions and get them to start thinking about how their work affects the organization’s overall carbon footprint and how some of their actions can have serious consequences on social and governance metrics. Target setting and Real Time Tracking can be made a lot of effective using a Mobile App versus a Web Based Version.
We are also working on a training and certification platform that will be deployed across Schools, Colleges, and Universities in addition to Corporates who can earn Continuous Professional Development (CPD) Points. One of the biggest challenges around Sustainability today is the lack of awareness and to bridge this gap, our platform will offer curated and customized courses for various levels and allow them to get engaged with projects on the ground.
We also have a Green Marketplace that we will be launching shortly that will connect buyers with sellers who go through a rigorous vetting process and meet certain qualification criteria to be listed on the Marketplace. Buyers will be able to source both Products and Services from reputed sellers on this Marketplace Globally.
There are a few more initiatives that we are working on and will make those announcements public over the next 12 to 15 months.
