Team Coastal Reefsilience
Connecting with Blue Finance to Fund Coral Reef Restoration
The Team
Austen Stovall
• Student Fellow at Blackstone LaunchPad Fellowship
• Former National Coral Reef Management Fellow - USVI
• Former Restoration Technician at Coral Reef Restoration Foundation
• BS in Biology from Wake Forest University
• MS Candidate in Coastal Science in Policy from the University of California, Santa Cruz
Adele Colwell
• Former Intern at Kapuscienski-Sarker Lab
• Former Head Science Intern at Thryve Inside
• Former NOAA Science Camp Counselor
• BS in Biology from the University of California, Santa Cruz
Problem Sponsor
Bernie Tershy, Co-founder: Island Conservation, Freshwater Life; Adjunct Faculty UCSC
Original Problem Statement
Can Reef Restoration Be Designed to Save Coastal Communities?
Beneficiary Discovery Interviews
25
The Innovation
Around the world, the risk for people, property, and ecosystems in coastal areas is rising. In addition to the ecological threat of coral reef degradation, this climate challenge leads to beach erosion and an increased flood risk to coastal homes and businesses. There is a critical need and interest from a variety of stakeholders in building natural defenses for coastal communities through resilient coral reefs.
Team Coastal Reefsilience at UC Santa Cruz was tasked with protecting these coastal communities and took full advantage of their eight weeks in Hacking for Oceans by speaking with experts across the field. At first, the team approached the problem through a purely biological lens and considered designing a novel structure that would increase the physical resiliency of the coral reefs. This strategy would allow for active preservation of the existing coral reef rather than simply working on restoration. However, after several beneficiary discovery interviews, the team realized that the required R&D funding required for this solution would make it prohibitively expensive to explore this solution.
As the team continued with their beneficiary discovery interviews, they pivoted their hypothesis to focus on solutions that lie within the world of finance and considered novel financing mechanisms and the world of “blue financing.” They learned about the work of the Nature Conservancy which was the first organization to work with insurance companies to protect coral reefs (learn more here). The organization created a parametric insurance system, which leads to a payout when certain parameters are met, such as certain levels of wind speed that damage the reef.
There is a potential for significant funding in the reef restoration space if the funding mechanism can be designed to deliver proper benefits. For the first time, government agencies (e.g., FEMA) and the world’s biggest re-insurers (e.g., Munich Re, Swiss Re) are considering how their funds could be invested in coral reef restoration to reduce future risk and build resilience. The team
pivoted their original problem statement and began asking: How can we channel funding into coral reef conservation by streamlining novel blue financing options?
The team spoke with potential beneficiaries such as hotels and governments who may be interested in purchasing an insurance premium to protect their local reef(s) from damage due to hurricane winds. In this insurance model, wind speed triggers a payout that goes directly toward reef restoration repairs to the coral reef that provides protection to the buyers. The team saw this innovative financing model as an area ripe for innovation.
From there, Team Coastal Reefsilience built an MVP for an insurance portal to streamline the coral reef insurance policy design and quotation process. The portal is tailored to those who are interested in obtaining a coral reef insurance policy. Users enter their information to see what types of policies they’d be eligible for, how much they would need to pay, and what their payout would be. It also provides contact information for organizations offering coral reef insurance.
A challenge the team has identified is how some coastal communities would be able to afford this funding structure. While paying for reef insurance may be financially feasible for coastal communities that are tourist destinations, funding this sort of insurance would be particularly challenging for smaller islands and coastal communities. The team continues to explore funding mechanisms to meet the needs of these communities as well.
Austen and Adele of Team Reefsilience have continued their work beyond the Hacking for Oceans semester. The team was accepted into UC Santa Cruz’s Blackstone LaunchPad program,
an eight-week summer fellowship program for entrepreneurs which has allowed them to continue their beneficiary discovery process, outline their business model, and connect with fellow rising entrepreneurs. The team plans to continue developing the Reef insurance portal beyond the fellowship and bring this opportunity to coastal communities.
Presentation
Team Costal Reefsilience’s Hacking for Oceans Experience
Thinking in New Ways
For Austen, the Hacking for Oceans course piqued her interest because it was an opportunity to learn how to think in new ways. After working as a reef restoration technician and conservationist, she found that in the field, practitioners are often bogged down by the work that needs to be done, leaving little time for innovative thinking. She was excited by the opportunity to think creatively about the work she had done and be a part of an interdisciplinary team to solve critical problems within the field.
At first, the team found it easy to lay out different hypotheses on the Mission Model Canvas because of their experiences in this area. As they began eliminating potential solutions and narrowing down their scope, they found that it became increasingly difficult to find the right person to speak to. “There aren’t a lot of people who do this work.” Austen shared. Though difficult, the beneficiary discovery process allowed them to expand their horizons in an area that they were very interested in.
Austen also shared that the Hacking for Oceans approach was a new way of thinking for her. “For me, it was an opportunity to use my brain in a way that I don’t usually use it ... it allowed me to think in a more entrepreneurial way.” Through the Lean LaunchPad methodology, the team would identify beneficiary pain points and tailor their MVP around the people working in the field.
Entrepreneurs within the Climate Movement
A critical part of the Lean LaunchPad methodology, and a challenge for Team Reefsilience, was growing accustomed to the live feedback they received at their weekly presentations. While it was difficult at times to respond to challenging mid-presentation questions, the process taught them to think on their feet. The undivided attention they had from the teaching team throughout the semester gave them the support they needed to hone in on their solution. Austen stated “This was a great opportunity to collaborate with people from different backgrounds and come up with really cool solutions.”
Initially, the team was hesitant to identify themselves as “entrepreneurs.” However, throughout the course and now through the Blackstone Fellowship, the team has grown their confidence in calling themselves mission-driven entrepreneurs working to solve pressing challenges facing coastal communities around the world.