Europe's Commitment to ESG: How Apiday Is Supporting Companies to Achieve Compliance

European regulations are transforming ESG (Environmental, Social, and Governance) reporting from optional to essential, creating exciting opportunities for innovative startups like Apiday. Based in Paris, Apiday offers a platform tailored to private equity funds and blue-chip companies that need to monitor and enhance their sustainability practices.

Asset management firms, particularly in Europe, have become primary targets for Apiday. The implementation of the Sustainable Finance Disclosure Regulation (SFDR) means that nearly all investment firms—beyond just impact funds—are now prioritizing ESG reporting.

This shift marks a significant change since Apiday's inception in 2021, especially as ESG faces some criticism. CEO Édouard Audi acknowledges Elon Musk's concerns about the limitations of ESG ratings. However, Audi emphasizes that Apiday’s mission is centered on leveraging ESG data to drive value creation rather than merely achieving compliance.

Recently, Apiday secured €10 million in a Series A funding round, poised to accelerate its growth amid competition from well-established players like AlphaSense, Dataminr, Sesamm, and FactSet-owned Truvalue Labs. Like its rivals, Apiday utilizes AI technology to enhance efficiency for its clients. Additionally, it blends cutting-edge AI with human expertise, setting itself apart in a crowded market, Audi explained in a recent interview.

Apiday has set ambitious expansion goals as well. With clients in 23 countries and 60% of its revenue coming from outside France, the company plans to reinforce its presence in Europe with new offices in Germany and the U.K. Furthermore, Apiday is set to expand its workforce from 40 to 70 employees over the next year to enhance its offerings.

Audi anticipates that this latest funding round will elevate Apiday's reputation among asset management firms. Prior to co-founding Apiday with former investor Charles Moury, Audi was involved in the ride-hailing sector with LeCab. He observed that while LeCab performed well in certain ESG aspects, this value went unrecognized during its sale due to insufficient metrics in that area.

The landscape of investor engagement with ESG has shifted considerably since then, and upcoming regulations like the Corporate Sustainability Reporting Directive (CSRD) are expected to further elevate the importance of ESG reporting. Stanislas Lot, the partner who led Apiday's funding round at Daphni, noted, “The significance of ESG data will dramatically increase in the coming years.”

However, it’s not just about gathering data; it's about leveraging it effectively. Apiday aids clients in crafting strategic roadmaps, providing guidance on approximately 350 actions they can implement to enhance their ESG practices after achieving compliance. While funds are already beginning this journey, Apiday anticipates corporates will soon follow suit, and it will be intriguing to see how quickly they adapt.

Apiday's Series A investors include AENU, Daphni, Galion.exe, and SWEN Capital, plus ongoing support from existing backers Speedinvest and Revent.