HB Antwerp, a diamond producer start-up with a focus on traceability and sustainability, has earned the 12th spot on Fortune’s 2024 Change the World list.
Since its founding in 2020, HB Antwerp has focused on returning value and economic benefits to Botswana, one of the world’s leading diamond-producing countries. Unlike established business models, HB Antwerp’s approach redefines transparency and shifts significant revenue to countries of origin through an innovative blockchain-backed structure.
Commitment to Botswana’s Economic Development
HB Antwerp’s model aims to ensure that diamond-producing countries receive a fair share of the industry’s profits. Rather than following conventional methods where foreign companies retain a large portion of revenue, HB Antwerp’s approach offers Botswana an 80% stake in the profits from the sale of polished diamonds. This marks a shift from typical practices, which generally involve paying for raw diamond parcels with limited additional benefit to the source country.
Reflecting on the company’s approach, Rafael Papismedov, HB Antwerp’s co-founder and managing director, said, “From day one, we were convinced that there was a better way to do business and have proved that by creating a new sustainable business model that is profitable and does good.”
Botswana has responded positively to HB Antwerp’s approach, which aligns with its goals of increasing local processing and job creation. President Mokgweetsi Masisi recently underscored the need for fairer terms with foreign companies, stating, “We must not be enslaved.” While he was defeated in his bid for a second term, his stance during negotiations with De Beers demonstrated a strong commitment to securing greater value for Botswana from its natural resources.
HB Antwerp’s Botswana facility employs 50 people, with plans for further expansion. The facility serves as a training ground for local diamond polishers and cutters, allowing Botswana to retain more value in the diamond supply chain. Co-founder Shai de Toledo commented, “It’s a small drop in the ocean. But once you understand what is coming out from every stone, you start to doubt everything else.”
Blockchain Technology for Greater Transparency
HB Antwerp has integrated blockchain technology to trace each diamond’s journey from mine to market, providing greater transparency. The system records over 3,000 data points per stone, refreshed every 15 minutes, tracking each transition in the production process. This system enables HB Antwerp to reliably provide Botswana with 80% of profits by ensuring diamonds are traceable throughout their journey.
Explaining the company’s revenue-sharing model, Papismedov noted, “It’s super-simple. We take 20% off the top. The higher I can sell it, the higher my margin. The other 80% is yours.” He further commented on longstanding diamond market practices, noting, “Everything is wrong with this industry.” HB Antwerp’s model avoids speculative production practices, instead tailoring production to actual market demand.
Industry-Wide Impact and Response
HB Antwerp’s approach has prompted discussion across the diamond industry, including longstanding players such as De Beers. The company’s model has encouraged Botswana to seek more equitable terms from De Beers, which agreed to double the country’s share of rough diamond revenues over the next decade, to 50%. De Beers chief people officer Malebogo Mpugwa noted the importance of economic diversification for Botswana, observing, “Even though diamonds are forever, diamond mines are not.”
HB Antwerp’s success in Botswana may offer insights for other resource-based economies. The Democratic Republic of Congo, with significant reserves of cobalt and other minerals, has shown interest in adopting similar models, with President Félix Tshisekedi visiting HB Antwerp’s operations to learn more. As de Toledo described the company’s broader mission, “The aim of HB is not to be in the diamond industry. It is to show the mining world how a supply chain should look.”
Despite initial scepticism from industry insiders, HB Antwerp’s success has led to increased attention. Co-founder Papismedov recalled, “When we began, they laughed at us. They met us in the elevator, and told us we would be bankrupt in two days.” The shift in perception has been noticeable, with some in the industry now closely observing HB Antwerp’s methods and its impact on the diamond sector.
Consumer Trust and Ethical Sourcing
HB Antwerp’s transparency also meets rising consumer interest in ethically sourced and traceable diamonds. Beginning next year, the company plans to introduce “birth certificates” for diamonds, allowing consumers to trace their gems back to the mine and understand their origins. This step is aimed at differentiating natural diamonds from lab-grown alternatives, which are increasingly chosen by cost-conscious buyers. As gemologist Grant Mobley from the Natural Diamond Council explained, “Consumers care more and more about where a stone comes from.”
HB Antwerp’s model provides investors with reliable data on diamond value, supporting the company’s growth and potentially allowing it to expand into other industries. Mobley described the appeal of traceable diamonds, saying, “When you can tell a story about a diamond’s origin, a person will fall in love with that stone.”
