Category: Ecosia

• The more searches people make, the more trees Ecosia plants.
• The German search engine finances its eco-regeneration activities through pay-per-click ads.
• The company’s chief tree planting officer told Insider how it chooses which projects to fund.
• See more stories on Insider’s business page.

Ecosia is a search engine with a difference.

For roughly every 45 searches made, the Berlin-based company plants a tree.

And Ecosia measures its success not based on how much money it makes, but on how many trees it has planted – and it’s planted almost 126 million so far, at a current rate of one tree per second.

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“Trees are really our currency,” Pieter Van Midwoud, the company’s chief tree planting officer, told Insider, calling it the company’s KPI.

When CEO Christian Kroll set up the company in December 2009, “he wanted to plant trees,” Midwoud said.

“He didn’t necessarily want to set up a search engine. His idea was: ‘where is there a lot of money to plant trees with?'”

“So the search engine was built to serve the purpose of planting the trees,” he said.

Midwoud has worked at Ecosia since 2016, and has overseen the company’s reforestation projects across the world. This involves choosing sites, ensuring the correct trees are planted in each region, working with local communities, and using satellite tech to monitor the trees.

Ecosia focuses largely on biodiversity hotspots with biologically isolated ecosystems, such as East African mountains, Madagascar, and the Brazilian coast.

Midwoud said Ecosia only plants native trees, and not exotic or invasive species. It’s planted more than 750 species so far and is working to create a diverse portfolio.

There are two main criteria that Ecosia considers when choosing which projects to support: they need to have an impact on both people and nature, supporting the local community, as well as restoring nature in the area.

For projects to be successful, Midwoud said Ecosia has to understand the “socio-economic reality” of the communities it’s working with, and what drives them to take ownership of the projects.

Ecosia finances its tree planting through ads

Midwoud said there had been a big jump in users over recent years, especially among young people, as awareness of the climate crisis grows. He said it had the youngest audience of all search engines.

Ecosia describes its business model as “a hybrid between a non-profit and full-profit business.” Rather than using its profits to pay dividends to shareholders, it uses them to fund reforestation projects.

In 2018, Ecosia became a “steward-owned” company, which means its shares can’t be sold at a profit or owned by people outside of the company, and that profits can’t be taken out of Ecosia.

Ecosia earns money from pay-per-click ads that appear alongside search results. The ads are delivered by Ecosia’s partner Bing, who pays Ecosia a share of the revenue generated via these ads.

Ecosia said the amount of the money it earns per click depends on the competition of the keyword and the value of what is being advertised.

“A click on one of the more lucrative keyword ads may finance multiple trees at a time, others may finance a fraction,” the company says in its FAQs, noting that search terms like “bank account” are likely to be of higher value than “chocolate.” It said that it earns an average of 0.005 euros per search.

Because of this, the company said that its income varies between months. It gets less income during the European summer months because people would rather be outside, but revenue peaks during the winter, especially around the holidays.

The company focuses on transparency and publishes monthly financial reports that show how much money it made from searches, what percentage of its revenue went towards trees, and how many trees it planted.

In April, Ecosia made 2.25 million euros. Just under half of this revenue – or 80% of its profits – went towards planting almost 7 million trees. The rest of the income was largely spent on direct and indirect costs such as taxes, salaries, and advertising. The remaining 20% of its profits went towards “green investments.”

As for Midwoud, his favorite species is the baobab, a tree with a nutritious fruit found mainly in Africa. The trees survive by storing a lot of water in their bark, and can grow up to more than 200 feet tall, making them often the only tree you can see.