GoodHuman, a Marketplace for Sustainable Brands, Finds It's Not Easy to Be Ethical

Francesca Billington

Francesca Billington is a freelance reporter. Prior to that, she was a general assignment reporter for dot.LA and has also reported for KCRW, the Santa Monica Daily Press and local publications in New Jersey. She graduated from Princeton in 2019 with a degree in anthropology.

GoodHuman, a Marketplace for Sustainable Brands, Finds It's Not Easy to Be Ethical

Two months ago, the CEO of a new ecommerce app, GoodHuman, where shoppers can find $95 Allbirds tennis shoes or pick up a set of $118 bamboo sheets, made the tough call to drop the popular clothing brand Reformation from its marketplace of sustainable companies.

The top-selling L.A.-based company — whose slogan reads "Being naked is the #1 most sustainable option. We're #2" — seemed to be a perfect brand for GoodHuman's site, where shoppers are encouraged to "discover all things sustainable and ethical." But the women's eco-conscious brand had taken a hit months earlier after one employee spoke out about a work environment that undermined and mistreated people of color.

Reformation released the results of its internal investigation last month finding its "workplace culture is not 'racist,' as alleged in the social media allegations."

The report didn't change GoodHuman co-founder and CEO James Glasscock's mind.

"We did pull it from curation because we felt like there was some work to be done," Glasscock said. "They've also been a leader in some areas over several years. It's complicated, to be fair."

Those complications, of what exactly is an ethical or sustainable company, are the territory that GoodHuman wants to own. Last week, Glasscock launched the company's app, an Amazon-like store that promises the "largest curated collection of sustainable products from ethical brands."

But figuring out who makes the cut isn't always simple and shows the many pitfalls brands face. GoodHuman isn't the only one doing this. Retailer giant Amazon rolled out its own eco-friendly platform in Europe last year.

GoodHuman determines what brands they sell based on five criteria. The site looks whether a company is certified in things such as fair trade, if it's free of 23 "toxic" ingredients and if the company is transparent. The other two considerations are internal research and, as they call it "community-driven discourse" or opposition by consumers to the brand.

"We think it's difficult for one person, one company to decide what is good for everybody," he said. "I'm not even the right person to decide if it is good or is not good. That's where the community comes in."

That last part is what ultimately triggered Glasscock to pull the popular Reformation.

"Our approach has been if we have to talk about it for too long, then let's just pull it," he said. "There are plenty of ethical and sustainable brands that have a good reputation that many users haven't even heard of."

What's an Ethical Brand?

Glasscock said his approach is "definitely not a perfect solution," but that consumers are seeking guidance in finding brands that align with their values. Some brands on the site sell more expensive products that can take longer to ship, but he said that's not the priority of shoppers that land on his site.

The company, founded in 2019, has so far vetted 680 brands and 50,000 products, which users can scroll through on the discover page under curated headlines like "Fashionably Frugal" and "Wholesome Home."

Glasscock, who spend much of the last decade in entertainment on the distributions side, said the startup has raised $1.2 million to date.

The company relies on the long list of independent bodies scanning brands for how they source materials and the impact of their shipping practices on the environment. Those standards, like Certified Organic and Fair Trade, are stamped on the front of chocolate bars or bagged coffee beans sold in grocery stores. Another is Certified B Corp, the guarantee given last week to L.A.-based organic food seller Thrive Market.

Those certifications have become a key marketing material as consumers become more environmentally conscious. Brands from H&M to McDonalds have embraced the idea of sustainability.

Changing Consumers

Joshua Clark Davis, a professor of history at the University of Baltimore, said businesses are eager to "give the appearance of sustainability," but not all of them fully practice it. In February, he published a book tracking the rise of mission-driven businesses and "conscious capitalism" that began in the 60s and 70s.

"Right now, especially in the age of Trump, people are looking for ways to advance and implement their values," he said. "We've seen how corporations in 2020 are eager to jump on the Black Lives Matter bandwagon, some of them sincerely, some of them less sincerely."

It's reflective of a shift in both consumer and business behavior. But will customers be willing to spend more? Glasscock thinks so. His biggest rival is Amazon.

"We got to make being a good human as convenient as being a bad human," he said. "For us, that means making it as easy as Amazon."

In September, the retail giant rolled out its own shopping platform for vetted eco-friendly products. It launched it in the UK and parts of Europe last. week. With it, Amazon also announced its own certification process, Compact by Design, to encourage companies to make products with less packaging.

"Amazon is a profit-first company," Glasscock said, adding that the move will end up saving Amazon money by lowering shipping costs and fitting more packages into fewer trucks, trains and ships.

"What's it all mean for GoodHuman? Validation of the opportunity for sure," he said. "On one hand we have the most fierce possible competitor a tiny L.A. startup could have. On the other hand, we are more focused on just this and confident we can build a better experience differentiated through curation, authenticity and community. Amazon has many priorities, we have only one."
🎬 Paramount and Skydance Are Back On
Image Source: Paramount

Happy Friday Los Angeles! Hope you all had a fantastic Fourth!!

🔦 Spotlight

Paramount and Skydance Media have rekindled talks to merge after negotiations abruptly halted in June. The proposed deal, contingent on approval from Paramount’s board, aims to combine Paramount’s extensive media holdings—including CBS, MTV, and Nickelodeon—with Skydance’s film expertise showcased in hits like "Top Gun: Maverick." This merger signals a potential transformation in the media landscape, positioning the new entity to compete more effectively amid challenges from streaming services and the decline of traditional cable TV.

Led by Shari Redstone, Paramount’s controlling shareholder via National Amusements, the deal represents a pivot towards revitalizing Paramount’s strategic direction amidst financial struggles and shareholder concerns. The involvement of major investors like RedBird Capital Partners and David Ellison underscores the financial backing aimed at stabilizing Paramount’s operations and addressing its $14 billion debt burden. Importantly, the agreement includes provisions to protect National Amusements from potential legal challenges, addressing previous hurdles that stalled earlier negotiations.

The deal also includes a 45-day period for Paramount to explore alternative offers, highlighting continued interest from other potential buyers like Barry Diller’s IAC and media executive Edgar Bronfman Jr. This flurry of activity underscores the significant stakeholders’ interest in Paramount’s future and its potential as a key player in a rapidly evolving media industry.

🤝 Venture Deals

LA Companies

  • Sidecar Health, a startup that offers personalized health insurance plans to businesses that allow members to see any doctor and pay directly at the time of service, raised a $165M Series D led by Koch Disruptive Technologies. - learn more

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😊🚘 Rivian's $5 Billion Lifeline

🔦 Spotlight

Volkswagen announced on Tuesday a significant investment of up to $5 billion in Rivian, a struggling electric truck manufacturer known for its vehicles' distinctive smiley-face design reminiscent of Volkswagen's iconic Beetle. This partnership marks a unique collaboration between the world's second-largest automaker and a startup grappling with profitability challenges akin to those faced by Tesla. Volkswagen's infusion of $1 billion initially, potentially rising to $5 billion pending regulatory approval, underscores its strategic pivot towards enhancing its electric vehicle (EV) software capabilities, an area where analysts believe the company has lagged.

For Rivian, which has received acclaim for its electric trucks and SUVs but struggles with production ramp-up and financial losses, the investment offers crucial financial backing. The company plans to utilize Volkswagen's expertise in manufacturing, leveraging the German automaker's annual production of nearly 10 million vehicles. This alliance aims to bolster Rivian's efforts to launch new models like the R2 midsize SUV and complete its Georgia factory, paused earlier this year to conserve funds. Rivian's stock surged upwards of 40% following the announcement, reflecting investor optimism in the company's future prospects.

Despite their differing corporate cultures—Volkswagen's traditional, structured approach contrasted with Rivian's agile tech startup ethos—the CEOs of both companies expressed mutual admiration and shared goals during the partnership announcement. The collaboration is expected to yield EV software solutions benefiting Volkswagen's various brands, potentially including Audi and Porsche, while allowing Rivian to maintain its brand identity and separate vehicle marketing strategies. This strategic partnership between Volkswagen and Rivian not only promises to revolutionize the electric vehicle market but also highlights the potential for collaboration between established automakers and innovative startups in Southern California, where Rivian is based. Here’s to hoping these smiling cars will balance out some of the inevitable LA road rage.

🤝 Venture Deals

LA Companies

  • HeyGen, a startup that allows users to generate videos with AI-created avatars that can lip-sync to provided audio, making it easier for businesses to create engaging video content, raised a $60M Funding Round at a $500M post-money valuation. The deal was led by Benchmark, with Conviction, Thrive Capital, and Bond Capital also stepping up. - learn more
  • Pomerium, a startup that provides a secure access platform that dynamically verifies user identities to ensure authorized access to applications and services, raised a $13.8M Series A round led by Benchmark and including previous investors Bain Capital, Haystack, and SNR. - learn more
  • Etched, a maker of transformer-specialized AI chips, raised a $120M Funding Round. - learn more
  • Rocketlane, a customer onboarding platform, raised a $24M Series B co-led by 8VC, Matrix Partners India, and Nexus Venture Partners. - learn more
  • Sift, a developer of unified observability solutions for hardware sensor data, raised a $17.5M Series A led by GV. - learn more
  • LOST iN, a travel media brand, raised a $4M Seed Round led by MaC Venture Capital. - learn more

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