The neem tree (Azadirachta Indica) has been dubbed “tree of the 21st century,” by the United Nations. Neem has the qualities essential to conquer some of mankind’s greatest threats. It possesses the ability to overcome the challenges restrained by the original Green Revolution, only without the hazardous side effects caused by the inadequate practices and synthetic chemical compounds, all the while, restoring the environment.
An evergreen tree and part of the same family as Mahogany, neem is indigenous to Southeast Asia. Neem is fast growing, rising by 2.6 feet (80cm) a year, it can reach up to 100 feet (30 meters) when fully grown. Able to withstand drought, its wide canopy forms a rounded crown of leaves that produce delicate white flowers and small green fruit shaped like an olive. In the West, scientific interest in the tree started as recently as the 1950s, much of it centered on the oil from the fruit, which contains multiple insect repellency and fertilizer properties. Azadirachtin, the key active ingredient in the oil, has such a complex chemical structure that it took 20 years to synthesize in the laboratory. It is this complexity that provides much of neem’s potency and unique flexibility.
A world beset with new challenges requires innovative thinking and a more imaginative approach. Sustainable businesses will be the only survivors in a world with rising environmental challenges, public awareness and accountability.
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The disruption of current business models through sustainable and regenerative techniques will lead to us becoming a driving force for change and revolutionize agriculture while protecting ecosystems all across the globe. The solution for sustainable solutions has never been higher than now as the harsh realities of unsustainability draw closer.
SUMMARY Neem is derived from the same plant family as the mahogany tree, making it an extremely durable wood and one of the most hardwearing and resilient timbers available on the planet. A durable, termite resistant, relatively heavy timber, neem wood is also utilized in building construction, agricultural implements, tool handles, fence posts and furniture.
Neem trees can yield harvests of around 12.5m3 (40 tons) of high quality compact wood per hectare, which will meet the growing demand for light-coloured neem wood utilized for household furniture.
Globally, all managed forests generate approximately $100 billion in wood removals and $18.5 billion in other forest products per annum, which is fueled by over $64 billion in investments. The annual global exports for primary and secondary wood products that originate from tropical forests, such as the Brazilian Amazon, have seen average revenue of $20 billion in the past five years up until 2015.
Neem exists in 80 countries around the world, consisting of 91 million trees. India is the main producer of neem, with 16% of the world’s total growing inside its borders86. Outside South Asia, the commercial cultivation of this valuable tree is limited, but coverage has spread across lowland regions of Africa, the Middle East, the Americas, Australia and the South Pacific. Production patterns are expected to change, with Brazil and China set to establish themselves as major competitors and leading producers of neem in the future.
STRATEGY Investors in neem-related products are those who appreciate the opportunity of being ahead of the curve. As an Early Adopter, investors will be in the very best position to catalyze a revolutionary transformation across these sectors, while at the same time maximizing returns in a sustainable and socially responsible manner.
A bell curve tracks best how new products and ideas spread through the marketplace. The curve begins with innovators, then moves rapidly to early adopters, who enjoy the maximum value from a new product’s introduction, before spreading across the rest of society, eventually reaching the laggards, by which time commoditization and ubiquity will nullify much of the value the product started with.
The idea of a diffusion curve (originated by Geoff Moore) shows how a successful business innovation travels from left to right over time and affects ever more consumers until it finally reaches everyone. The X-axis shows the different groups an idea encounters over time, while the Y-axis shows the number of people in each group.
The greatest value accrues at the beginning of the peak. Innovators often spend considerable time and financial resources in getting their idea beyond the concept stage. By that point they often don’t have the necessary capital to take the next step, allowing them to benefit from their hard work and make the transition to success. This is where early adopters get involved. By providing support in whatever form required, and often based on their experience at this stage of proceedings, early adopters can help to bring the product or innovation to market.
Being ‘ahead of the curve’ rewards early adopters. It allows them to participate once the concept has been proved, on what are usually highly attractive terms, way ahead of the majority of their peers or the population at large. Yet the value peak only starts near its apex, underplaying how long it took to reach that position and showing how the period of maximum value is relatively short compared to that of the tail.
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Neem has the potential to solve some of the most pressing global challenges we face today within the spheres of agriculture, healthcare and the environment. We believe that for those that cultivate the neem industry, both moral satisfaction in solving a global grand challenge and revolutionizing a more sustainable way to feed the global population, as well as highly rewarding financial profits will be gained.
At Birchwood Stanhope, it’s important to us you have a fundamental understanding of what you are investing in. This is an offer to you, via Birchwood Stanhope to take an equity stake in one of the most promising private companies in the bio-pesticide and bio-fertilizer markets.
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