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ecoATM Recycles E-Waste for Charity and Profit

ecoATM

EcoATM kiosk users first put the phone into a slot in the machine, which scans it, makes an offer and provides a QR code label. They can put the label on the back of the phone and put back into the machine to collect or donate the dollar value of the device.

The recent announcement by the U.S. EPA encouraging companies to launch a new program to pursue responsible management of their unwanted and used electronic devices was a welcome shot in the arm for the emerging industry of responsibly recycling and re-using unwanted electronics, and we decided to take a closer look at some of the innovative players in this field. At the top of our radar screen is the growing company ecoATM, which offers an innovative way for individuals to safely dispose of small, handheld electronic devices, while offering cash for the unwanted devices.

Inspired by an article about ecoATM in Bloomberg BusinessWeek, we reached out to the company’s founder, Mark Bowles to learn more:

Sustainable Plant: Thank you so much for the time, Mark. How did you get the idea to launch the firm?

Mark Bowles: “In the summer of 2008, I was working with a few other guys on different ideas for new start-ups, as I am a serial entrepreneur, and as we went through a Nokia survey, one of the questions was, ‘Have you ever recycled a mobile phone?’ and only 3% said yes. That prompted us to do the classic ‘mesearch’ – why haven’t I recycled my old cell phones? After a few weeks of considering different ideas, we came up with the idea for a kiosk.

“Then, in the summer of 2009, we developed our first prototype. That had no real automation technology, so it required a person to stand next to it to evaluate and pay for the phones. About a year later, we had some basic automation functionality that proved the technology could work. After testing and refining that technology, we got it to a point where it was robust and precise enough to be fully automated with none of our staff required to help at the kiosks. Since then we have launched about 200 kiosks, at a rate of about 15 per week. Up until 18 months ago, these were human staffed; now they are all fully automated.”

SP: “Definitely an interesting journey. How did this concept grow – what was your ‘secret sauce?’”

MB: “Basically, give the people what they want, and what they want is money. To make it easier for them we focused on three things: First, be in our customer’s normal path, so they see it (the kiosk) normally and so it’s not a special trip for them; two, make it incentivized by offering instant cash, not store credit and with no changing the offered price later or waiting for a check in the mail; and three, gain people’s trust on handling on the environmental and data-handling piece of recycling their devices.”

SP: “This is definitely a novel idea, much different than the other organizations offering similar services nationwide. Given that, do you envision any obstacles to expansion – logistical, financial or otherwise?”

MB: “We always have operational and execution challenges, and I think we’ve mastered most of those. We’re also planning for international trials, while we’ve expanded to 15 states now domestically. We’ve also seen that the service behaves differently in different markets, but with three-plus years of experience now, we have a pretty good handle as to what might happen, so our business is pretty well under control.”
 
SP: “What would you say separates ecoATM from its competitors, say, Gazelle or Terracycle, the company that offers points for recycled items sent to them (as noted in a recent issue of Packaging Digest)?”

MB: “I think what separates ecoATM is that we’re convenient, rather than having to wait for the box in the mail, or worry about grading if they don’t agree, so you thought you were getting $100 for your device and then, when the check arrives in the mail, you only get $60. We don’t have any checks in the mail. We have found that customers prefer cash over store credit and points. Almost all of our competitors are geared only towards brands and models, particularly iPhones, and only accept a few categories of broken devices, and maybe a few Samsungs or Androids; they really only take a narrow set of mobile type devices. We take just about anything, from our database of aver 4,000 items, and are very broad in what we take. That’s the big differential.”

SP: “The option you provide your users to donate the money for specific charities is innovative. Can you elaborate how that works?”
 
MB: “Charity collection boxes have been the roots of mobile phone take-back since the 1980s and we want to continue to provide that option, and for any charity that wants to be a part of it – from local Boy Scout troops up to United Way, and other charities. We offer a combination of local and national charities - we allow them to donate some or all of their money. How it works is, if a consumer puts in their iPhone and gets $250 for it and designates a charity, the charity would get the entire $250. We don’t take any fee from that donation, we pass 100% of it through to the charity. To participate as a charity, you would call us to be designated on the kiosk as an option for our customers to choose. We collect on behalf of that charity and then pass all donations on to the charity. Another way that it happens is, charities sometimes collect phones and get the cash directly. In one instance, a preacher was passing the plate on Sunday to collect phones; he saved enough to buy a video camera. There are a lot of ways to do it. We have worked with the United Way, Make a Wish, Wounded Warrior Project, and others.”
 
SP: “Are you aware of other electronic take-back organizations performing this same service?”

MB: “There are groups of phone collections that started in charities. AT&T has one, Cell Phones for Soldiers; Verizon has one, Hope Line for Battered Women – a lot of history in that space. For other electronics, the Christiana Foundation, who collect PCs, and a few others in San Diego are part of our charity program.”

SP: “For those devices that are not re-sold, how are they managed, and where do these go? To e-steward recyclers?”

MB: “We are R2 and ISO certified, and about 25% of the devices collected either go to e-steward or R2 recyclers to ensure the precious metals are reclaimed and any toxic material is quarantined. The other 75% of what we collect finds a second life as the device it started as. At most kiosks, we still pay the minimum amount for phones that are broken, and for a device the scanners can recognize, whether it’s a phone, MP3 player or a tablet; we take those devices to the recyclers. We don’t make money on the scrap stuff but we do want to encourage customers to give that to us to recycle properly instead of taking it back home and putting it in the drawer or eventually the landfill.”

SP: “Who are some of the R2 recyclers you use?”

MB: “We have only done business with a handful of them. We don’t have a great smelting facility yet here in the United States, but Umicore in Belgium, and the Chinese have advanced facilities; as we get to scale, we can go directly to Umicore – they do the best job of anybody.”

SP: “Can you share some of the metrics of devices received to date, such as units taken back, money sent to charities, etc?”


MB: “We have collected hundreds of thousands of devices, and have paid out millions of dollars for those devices. This is money that goes back into the pockets of consumers, and the device is not going to landfill. If you ask them (the consumers) in a survey how many would recycle for charitable causes, 30 percent will say yes, but in reality there is only about 1 percent.”
 
SP: “Do you think that EPA’s recent announcement related to companies recycling 100 percent of their unwanted electronics could have a positive impact on your business?”


MB: “I think it’s a noble thing, but there are a couple of issues that remain, such as, there’s not a set of harmonized laws of what corporations and people can do. For example, 25 states have e-waste laws, and none are the same; some even have conflict. As a result, if you’re a company, you are between a rock and a hard place with difficult laws to comply with if you want to do the right thing. The laws as written are either archaic or difficult to comply with. I feel there needs to be more harmonization with state laws.”

The company was recently featured on ABC Nightly News and its homepage features a running total of national and local news stories. This is one company with an innovative idea for taking a slice out of the burgeoning e-waste stream and giving back to the community one electronic device at a time. This is truly a sustainable model and the optional charitable component associated with the exchange for cash from each device can only grow with time and word of mouth about what EcoATM is accomplishing.

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