Ethical smartphone seeks new investors

Sensemaking / Ethical smartphone seeks new investors

Fairphone claims more funding could help its ethically produced Android handset crack the mass market.

By Will Simpson / 26 Jul 2013

It purports to be the world’s first ethically traded and sustainably sourced mobile handset. But can the Fairphone gain a foothold in a market where such concerns are not a priority?

A Netherlands-based initiative, Fairphone was set up in 2010 with the stated aim of producing an Android smartphone with a completely transparent supply chain. It uses tin and tantalum from Congo DR which are guaranteed ‘conflict-free’, and whilst it is assembled in China, Fairphone insists that its suppliers are committed to improving workers’ social conditions. The handset is easily recycled, and Fairphone has also promised to donate €3 for every model sold to electronic recycling projects in Ghana.

It’s a largely crowd-sourced venture, which went into production in June following pre-orders from 5,000 customers, who each committed €325. But founder Bas Van Abel admits that, to take the project to scale, new investment is essential. He is looking for €5-10 million, but expects the enterprise will attract bank loans and social impact investors, rather than “your average venture capitalist”. He adds, “We will only work with equity investments if they are strategically aligned with our next steps, so they can add to our mission.”

Casper Jorna, Terminals Sustainability Manager at Vodafone, is impressed. “Fairphone is addressing supply chain models in a way which most manufacturers cannot yet do because of existing commercial agreements. They are open that it is not completely sustainable on the first run they are addressing the most critical issues first and then working their way through the rest.”

Forum for the Future’s digital expert James Taplin suggests that the first model would score highly on the Eco Rating system for mobile phones that he developed in conjunction with O2. “It would probably be very near the top of the pack. It has a solid performance in terms of direct impacts.”

Taplin is less sure though whether it will be anything more than a niche brand. “To break into the mass market is very difficult and many big players have failed. But Fairphone has a shot.” – Will Simpson

Photo credit: Fairphone

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