Investment in manufacturer of green bricks

Chilasa Venture Philanthropy, a pioneer in small enterprise growth in poor communities, today announced a new investment to support the expansion of Ecoway Bricks PVT LTD, a manufacturer of environmental building products made from rice husk ash.
 
India is the world’s second largest producer of bricks after China, employing an estimated 10 million brick workers. The conventional burnt clay brick industry faces severe challenges due to slave labour practices, acute environmental pollution, and outdated production methods.
 
Ecoway was established in 2013 to expand the production of bricks and building products made with recycled material from modern rice mills. The founder G. Gopalakrishnan, developed the original brick product in 2007 while working with women’s self help groups to find solutions to environmental pollution affecting their communities. After successful product testing, supported by The Indian Institute of Technology Madras (IITM), Gopalakrishnan set-up a manufacturing unit in his home  district of Kanchepurram, Tamil Nadu, to supply the local construction market with quality bricks made from rice husk ash.  

Photo courtesy of Ankur Capital

Photo courtesy of Ankur Capital

Rice husk ash is a waste product resulting from the processing of paddy by modern rice mills. Approximately 20 million tonnes of rice husk ash is produced annually in India, much of which is indiscriminately dumped polluting water sources, wastelands, and agricultural land. In addition to the environmental benefits, Ecoway bricks are stronger, lighter, and are more durable than conventional burnt clay bricks.   
 
In recognition of the product innovation and positive impact on the environment, Gopalakrishnan has been awarded several prizes, including All India Business Development Association 2011- “BHARATIYA VIKAS RATAN AWARD” for social responsible activities.
 
Chilasa will draw on its strong manufacturing and operational expertise to support Ecoway’s growth from a local producer into a market leader in the region. Chilasa’s James Varghese, Director of Investments, is joining the Ecoway Board and R. James, Head of Entrepreneurship, will lead the capacity building and technical support. The investment will create direct impact on poverty by creating jobs, supporting the local economy, and reducing environmental pollution.  The investment in Ecoway is a strong representation of Chilasa’s strategy of investing in small manufacturing enterprises with proven leadership, where the underlying business model has high-growth potential for impact and scale through replication in multiple locations.

G. Gopalakrishnan, Managing Director of Ecoway Bricks, said “The more bricks we sell, the more we save our environment, create employment, and help bring positive change to our industry. We have ambitions to grow and the Chilasa team has shown a unique understanding of the challenges we face as a small enterprise. With Chilasa’s expertise, R&D partnerships, networks, and on-going local support, we are going to make a big difference in our community and the wider brick making industry”. 
 
James Varghese, Director of Investments at Chilasa, said “The construction industry is expected to grow at a rate of 8.9% p.a. for the foreseeable future, making the long-term prospects for the building materials sector very positive. The opportunity to support Ecoway’s expansion, create quality jobs in the rural manufacturing sector, and help solve environmental pollution, make this investment very attractive for Chilasa”. 
 
Nigel Majakari, Founder and Managing Director at Chilasa, commented that “There is growing concern that India’s construction boom is built on the back of slave labour and environmental pollution in the brick industry. With pressure mounting on companies to clean-up their supply chain, urgent solutions are needed. Our investment will help position Ecoway as the leading supplier of green bricks with a no slave labour guarantee”.   

Editor’s note:  This article was first published at Chilasa Venture Philanthropy with the title “Chilasa invests in Indian green building products manufacturer Ecoway Bricks.”  

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