{"id":1655,"date":"2018-02-16T12:54:14","date_gmt":"2018-02-16T16:54:14","guid":{"rendered":"http:\/\/blogs.bard.edu\/mba\/?p=1655"},"modified":"2018-02-16T12:54:14","modified_gmt":"2018-02-16T16:54:14","slug":"terracycle-eliminating-the-idea-of-waste-by-recycling-everything-by-alistair-hall","status":"publish","type":"post","link":"https:\/\/blogs.bard.edu\/mba\/2018\/02\/16\/terracycle-eliminating-the-idea-of-waste-by-recycling-everything-by-alistair-hall\/","title":{"rendered":"TerraCycle: Eliminating the idea of waste by recycling everything–By Alistair Hall"},"content":{"rendered":"

Republished from GreenBiz<\/a><\/em><\/p>\n

\u201cWhy does waste even exist?\u201d\u2014that\u2019s the question at the heart of TerraCycle\u2019s own existence. Since 2001, the company has been taking hard-to-recycle waste and turning it into raw material for use in new products. It now operates in over 20 countries and engages over 60 million people.<\/p>\n

This year marked a period of significant growth for the relentlessly innovative company. TerraCycle had its first acquisition, placing it on the path to going public. It\u2019s leveraging the JOBS Act to crowdsource for equity. And it\u2019s partnering with major organizations like Proctor & Gamble, Mars, Nestl\u00e9 and Uniliver to generate ultra-durable packaging forms that\u2019ll be owned by the manufacturer and merely leant to the consumer.<\/p>\n

In December, Bard MBA\u2019s Alistair Hall spoke with Tom Szaky, Founder & CEO of TerraCycle, about the company\u2019s plans for growth and all the ways in which it continues to work toward eliminating the idea of waste in our world.<\/p>\n

The following Q&A is an edited excerpt from the Bard MBA\u2019s February <\/em>2nd <\/em>The Impact Report<\/em><\/a> podcast. The Impact Report brings together students and faculty in <\/em>Bard\u2019s MBA in Sustainability<\/em><\/a> program with leaders in business, sustainability and social entrepreneurship.<\/em><\/p>\n

 <\/p>\n

BARD MBA: A lot has happened with TerraCycle in the last year. First and foremost, you and TerraCycle were recognized by the United Nations with the Momentum for Change Lighthouse Award<\/a>. Can you tell us about that?<\/p>\n

Tom Szaky: TerraCycle was given the award because of the work we\u2019ve been doing around bringing solutions to ocean plastic. Today, 25% of the world\u2019s plastic ends up in our oceans. It washes up on beaches and river shores, and also floats directly in the ocean. We collect this material all over the world and then, with the help of Proctor & Gamble, turn it into things like the Head & Shoulders bottle and their dish soap bottle\u2014and soon other categories as well.<\/p>\n

We\u2019re looking at how to get waste back into the supply chain, especially something as challenging as ocean plastic. But we\u2019re also asking, \u201cHow do we move away from disposability altogether?\u201d We need to move from disposable products and packaging to durable ones that are borrowed and used in more like a circular economy process.<\/p>\n

 <\/p>\n

\"\"<\/a><\/p>\n

BARD MBA: How did the partnership with Head & Shoulders come about?<\/p>\n

Szaky: It\u2019s interesting. About 95% of the time, we approach partners and share ideas and try to convince them to join. In the Head & Shoulders example, Proctor & Gamble came to us. They had a desire to do something meaningful around ocean plastic and wanted a partner to execute it. TerraCycle became the partner, and it became a huge success. It\u2019s still growing, which is really exciting to see.<\/p>\n

 <\/p>\n

BARD MBA: We heard that recently TerraCycle had its first acquisition. Can you tell us a little bit about that deal and how it came about?<\/p>\n

Szaky: About a month ago, we bought a company called Air Cycle. It\u2019s a Chicago-based company that\u2019s been around for about thirty years. It does lightbulb recycling.<\/p>\n

It\u2019s important to note that there\u2019s a whole category of waste out there called hazardous or universal waste: everything from batteries to medical sharps to fluorescent lightbulbs that you can\u2019t legally put in your garbage. Fluorescent tubes, for instance, have mercury gas inside, so if they break and release their chemicals, especially in bulk, it\u2019s really big issue. Air Cycle has built up a beautiful and profitable business collecting and recycling lightbulbs. They have an equipment division that crushes fluorescent tubes and recovers the gas in a very safe way.<\/p>\n

So we purchased them, and so far it\u2019s been fantastic. They\u2019re being infused into our culture, seeing waste the way we see it, and bringing all of the creativity that we try to bring to waste on a daily basis. I think it\u2019ll really help them grow their business faster than they were currently growing.<\/p>\n

For us, it\u2019s important because right now we\u2019re about a $30 million business. We want at some point to go public, which we need to be at at least $60-70 million to do. In 2017, we organically grew 20%, and we think a good way to supplement that is by doing more mergers and acquisitions. We definitely have the appetite. This first acquisition has gone very well, and we look forward to doing maybe one or two more in 2018 as a way to get to that next goal.<\/p>\n

 <\/p>\n

BARD MBA: How are you bringing innovation to an industry that\u2019s traditionally not innovative?<\/p>\n

Szaky: What we do is think about everything in a slightly different way. Today, waste management companies make their profit through disposal\u2014they look at waste as a liability. What we look at is, \u201cWhat are all the possible points of value beyond just the material value of the waste stream?\u201d So, could there be reputational value and could it drive foot traffic? There are whole sets of exciting outcomes and ways to monetize waste. That philosophy is the lens we bring to the question.<\/p>\n

Our second central philosophy is to ask the question, \u201cWhy does waste even exist?\u201d\u2014and challenge that. We now have some amazing partners, from Proctor & Gamble and Mars to Unilever and other major organizations like Nestl\u00e9, who are working with us on challenging that very question. The outcome will be moving from disposable packages that are owned by the consumer to ultra-durable packaging forms that are owned by the manufacturer and just loaned to the consumer.<\/p>\n

 <\/p>\n

BARD MBA: We\u2019ve been reading with interest about TerraCycle\u2019s equity crowdfunding effort under the Jobs Act. Can you tell us a little bit about what\u2019s happening there?<\/p>\n

Szaky: The JOBS Act<\/a>, passed under President Obama, creates a new way of raising capital that allows any investor to take part. To take a step back, current startups raise capital under something called Regulation D financing. It\u2019s a great way to raise capital, but it limits a startup to only accredited investors\u2014investors with over a million dollars in net worth. This eliminates the ability for people who may not be wealthy or who want to invest smaller amounts to invest.<\/p>\n

Under the JOBS Act, you can effectively crowdsource for equity. Classic crowdsourcing involves doing pre-orders\u2014for example, committing to buy a knife from a startup that\u2019s making knives. When the startup gets to a million dollars in pre-commitments, it gets paid that money and then can go build its knife. Here, it\u2019s crowdfunding for actual equity.<\/p>\n

This is really exciting for us because it allows anyone who\u2019s been watching TerraCycle, or who\u2019s intrigued by our business model, to invest. In the two weeks since we launched this, we already have over 650 investors. We feel that we\u2019ll be able to raise the $25 million we\u2019re seeking within 90 days, based on the rate at which capital is coming in.<\/p>\n

That, by the way would make it the largest non-real estate Regulation A in history, which we\u2019re quite excited about. If anyone\u2019s interested in learning more about what Regulation A financing looks like, you can go to ownterracycle.com<\/a> to read all about it.<\/p>\n","protected":false},"excerpt":{"rendered":"

Republished from GreenBiz \u201cWhy does waste even exist?\u201d\u2014that\u2019s the question at the heart of TerraCycle\u2019s own existence. Since 2001, the company has […]<\/p>\n","protected":false},"author":360,"featured_media":1656,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[261,132,469,331,468,467,302],"class_list":["post-1655","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stories","tag-alistair-hall","tag-bard-mba","tag-jobs-act","tag-recycle","tag-terracycle","tag-tom-szaky","tag-zero-waste"],"jetpack_featured_media_url":"https:\/\/blogs.bard.edu\/mba\/files\/2018\/02\/TIR102-TOM-SZAKY-e1518800015158.jpg","_links":{"self":[{"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/posts\/1655","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/users\/360"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/comments?post=1655"}],"version-history":[{"count":2,"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/posts\/1655\/revisions"}],"predecessor-version":[{"id":1658,"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/posts\/1655\/revisions\/1658"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/media\/1656"}],"wp:attachment":[{"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/media?parent=1655"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/categories?post=1655"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.bard.edu\/mba\/wp-json\/wp\/v2\/tags?post=1655"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}