Making garbage useful with Tom Szaky of TerraCycle
Aug 17, 2023
43:43
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Tom Szaky, founder of TerraCycle, talks about his entrepreneurial journey from starting a worm poop fertilizer company to building a multimillion dollar recycling business. He discusses the challenges and benefits of recycling, TerraCycle's transition to developing reusable packaging, and the need for strategic consumption to reduce waste.
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Quick takeaways
TerraCycle's Loop initiative promotes reusable packaging as a more effective waste-reduction tactic than recyclable packaging.
TerraCycle aims to transition away from its recycling division and focus on its Loop division as reusable models gain traction in the market.
TerraCycle emphasizes the need for a significant reduction in consumption as the ultimate solution to waste, highlighting the responsibility of businesses, consumers, and legislation in achieving a sustainable future.
Deep dives
Transitioning from Fertilizer to Waste Recycling
Tom Zaki, co-founder and CEO of TerraCycle, shares his journey of transitioning from a fertilizer company to a waste recycling service. Inspired by a friend who turned food scraps into worm poop fertilizer, Zaki became fascinated with the idea of garbage and sought to create business models that solve waste problems. TerraCycle collects various types of waste and processes them into raw materials for manufacturing other products. Zaki emphasizes the need to move away from the linear consumption model and towards a circular economy where materials are reused or recycled.
The Reusable Packaging Program
Alongside its waste recycling division, TerraCycle has launched Loop, a program that partners with major consumer product companies to encourage reusable packaging. Brand partners, such as Tide and Hagen-Dazs, create reusable versions of their products, such as Tide in stainless steel containers. Consumers pay a deposit for the package and return it to Loop for cleaning and refilling. Loop aims to eliminate waste by promoting reuse, which is seen as a superior solution to recycling in terms of reducing environmental impact.
The Economics of TerraCycle
TerraCycle turned profitable in 2015 and has achieved steady revenue growth since then. In 2020, the company raised $25 million in funding. Its revenue for the year is projected to be around $75-80 million. While striving to create a sustainable business, TerraCycle's ultimate goal is to reduce consumption and eliminate waste. The company is investing in its Loop division, which focuses on reusable packaging, and aims to transition away from its recycling division as reusable models gain traction.
Challenges and Solutions in Sustainable Packaging
TerraCycle acknowledges the pros and cons of different packaging materials. While plastics are often criticized, they may still be suitable for certain applications. Reusability and reduction of packaging are emphasized as important goals. Transitioning to a future with reusable packaging requires tackling economic and behavioral challenges. Brand engagement, consumer awareness, and incentives, such as community benefit or fun and exciting experiences, can drive participation in sustainable packaging programs.
The Long-Term Vision: Shifting Consumption Patterns
The long-term vision of TerraCycle extends beyond recycling and reuse. The ultimate solution lies in a significant reduction of consumption. Tom Zaki highlights the need for reflection on our consumption patterns and the responsibility of businesses, consumers, and legislation in addressing the externalities of waste. By shifting the relationship with consumption, a sustainable future can be achieved.
Tom Szaky runs a recycling company, but he’d rather live in a world where recycling was obsolete...
Today, his company recycles everything from shampoo bottles and makeup containers to snack wrappers and cigarette butts. And through their recent Loop initiative, TerraCycle works with consumer brands to develop packaging that is actually reusable -- an even more effective waste-reduction tactic than recyclable packaging.
This week on How I Built This Lab, Tom recounts his entrepreneurial journey launching a worm poop fertilizer company from his college dorm room, then transforming that company into a multimillion dollar recycling business. Also, why Tom’s ultimate goal is to put himself out of business, and how our actual path to eliminating waste is radically reducing consumption.
This episode was produced by J.C. Howard and edited by John Isabella, with research by Kerry Thompson and music by Ramtin Arablouei. Our audio engineer was James Willetts.