Tommaso Buso

Bankers without Boundaries: Driving investment in the circular economy

An interview with Tommaso Buso, Associate at Bankers without Boundaries


Could you please introduce Bankers without Boundaries (BwB) and elaborate on your contribution to the circular economy transition? 

BwB was born from the idea that the knowledge and skills of investment bankers could be used to benefit the environment and society. Motivated by the stark reality that the climate crisis would require trillions of dollars to transition to new sectors and structures, BwB gathered former investment bankers accustomed to facilitating large-scale financial transactions to apply their skills to address this challenge. 

The organisation was founded in 2013 by Rupesh Madlani, a former number-one-ranked research analyst, and Angus Forbes, a top-rated hedge fund portfolio manager. Ten years later, the team has grown significantly, and BwB has mobilised more than US$4 billion, working with more than 20 sovereign nations, 100 cities and several corporations.

The firm’s ethos is similar to that of Médecins Sans Frontières, which provides medical aid where it is needed most. Headquartered in London, the firm has regional offices in Dublin and Singapore, making BwB’s reach  global, serving governments, cities and foundations worldwide with the expertise to unlock capital towards high-impact projects for the environmental and social good. 

In the circular economy space, BwB has led a set of highly significant projects aside from DEFINITE-CCRI. For instance, BwB is assisting in developing a circular textiles accelerator programme, working with ten start-ups in Amsterdam to develop early-stage ideas and business models into bankable projects, helping these projects secure financing, and then helping them scale into profitable companies. BwB has also been active in the construction sector, developing innovative financial models to leverage private finance into decarbonising the built environment and tackling the challenges and opportunities that increasing circularity in the sector offers. 

Our ambition is to scale our footprint in the circularity space, which we deem to be highly strategic but still underfunded due to the novelty and complexity of deploying traditional financing instruments into new economic models. 


What is BwB’s role within the DEFINITE-CCRI project, and how do the project partners complement each other?  

BwB is the chief financial partner of the consortium, leading the financial assessment and technical due diligence work. We are glad to cooperate with highly competent partners such as Circle Economy, which provides both technical and financial expertise, the National Technical University of Athens for the circularity and impact-related aspects, and ICLEI for the overarching coordination. We operate in strict collaboration, allowing us to be the most informed and effective when assessing projects and providing them with the necessary support.


What are currently the main barriers to investment in the circular economy in Europe? 

The main barriers to investment in circular economy projects in Europe currently include regulatory uncertainties, lack of standardised metrics for measuring circularity and upfront capital costs.


What can be done to overcome them?  

Addressing regulatory uncertainties involves advocating for clearer and more consistent policies to create a stable investment environment. This can be achieved through industry collaboration, engaging with policymakers and actively participating in the policy development process.

The absence of standardised metrics hinders investors' ability to consistently assess the impact and performance of circular economy projects. Establishing industry-wide standards and metrics for circularity will enhance transparency and enable more accurate assessments, making it easier for investors to evaluate and compare different projects.

The issue of upfront capital costs can be mitigated by exploring innovative financing models, such as public-private partnerships or dedicated funding mechanisms for circular economy initiatives. Highlighting the long-term economic benefits, including reduced resource dependency and operational efficiencies, can also make circular projects more attractive to investors. Additionally, increasing awareness and education about the benefits of circular economy projects among investors can help overcome scepticism and build confidence in the potential returns on investment.


Can you provide examples of successful circular business models that BwB would like to implement?

From a financial standpoint, we see great impact potential in the Product-as-a-Service (PaaS) model. Under this framework, a product is offered as a subscription to the user alongside its maintenance and replacement when the tool or object reaches the end of its life. The components are then recycled or reused into new products. 

This solution, which is gaining popularity, particularly in the industrial space, has the drawback of being feasible only in the B2B setting since it would be complex and risky to establish individual subscription contracts for private users. Nonetheless, in large industrial complexes with high consumption and high maintenance of products, this solution can offer a steady and safe income to producers and total control of the supply chain and raw materials. 


How does BwB balance impact potential and financial returns when assessing circular investment opportunities? 

While the perfect balance between impact and financial return is hard to strike, a highly impactful project that cannot generate returns in any viable way is unlikely to be selected by investors seeking returns. Therefore, we try to screen projects with a minimum viability potential from a business model perspective. Then, we compare them based on the impact they can generate and the effectiveness of their circularity value proposition. It is worth noting that the end investors themselves will determine the ultimate balance between impact and financial returns. Thus, there will always be a range of possibilities.


From your conversations with investors, can you conclude that interest in circular economy projects is growing? 

Based on recent discussions we led with investors, there's a clear trend indicating a growing interest in circular economy projects. Many investors are increasingly recognising the long-term benefits and positive environmental impact of such initiatives.


What factors determine investors’ decision to invest in circular economy projects? 

Several factors influence investors' decisions in this space. Firstly, economic viability plays a crucial role. Investors want to see a solid business case with clear cost savings and potential for revenue generation. The environmental impact is another significant factor, as investors increasingly align their portfolios with sustainable and eco-friendly projects. Regulatory support and incentives are also key drivers, as they provide certainty and reduce perceived risks.


What should project owners consider while developing their proposals?Project owners should emphasise their projects’ economic and environmental advantages. Demonstrating a clear return on investment—along with a detailed plan for waste reduction, resource efficiency and carbon footprint reduction—is essential. Clear, measurable and verifiable metrics to monitor the impact returns are essential to identify and implement. Collaborations and partnerships within the circular economy ecosystem can enhance the credibility of proposals. Moreover, considering scalability and adaptability in the face of changing market conditions is crucial. Flexibility in the project design and understanding potential regulatory shifts will make the proposal more resilient.


What challenges do you encounter in sourcing projects? 

Project sourcing is definitely challenging, especially if we aim to identify a set of projects which are mature and large enough to fit the timeline for the technical assistance and the overall project appraisal or the introduction to investors, which needs to happen in a timeline that fits the project’s need for capital.

Additionally, identifying and engaging investors in a preliminary phase has proven quite challenging, especially because circular economy project size tends to be limited compared to the average ticket sizes most investors are used to.

Nonetheless, cities, in general, can accelerate the involvement of investors through several actions:

  1. Coordinate and foster collaboration between financial institutions, businesses and government agencies to ensure the effectiveness of the invested capital.  
  2. Ensure that the applying projects have a clearly defined path to generating revenue or are revenue-generating—either on their own or thanks to the payment of ecosystem services. 
  3. Develop clear and reliable regulatory frameworks to minimise investment risk. 
  4. Showcase successful case studies to demonstrate circular initiatives' profitability and positive impact.

Publishing date: