Tom Szaky is rapidly turning into the eco-rock star of the sustainable business movement and it all started with compost. This 27 year old Hungarian native was attending Princeton University when he started rethinking the waste paradigm.
He started by selling compost (Worm Gin) as a high-grade plant fertilizer (rumor has it the compost epiphany came after trying to find a better way to grow pot) and after compost sales took off, he quit school, invested his savings in TerraCycle and the rest is green history.
We caught up with Tom Szaky, founder and CEO of TerraCycle to ask him a few questions about his expanding sustainable empire.
Tell us about TerraCycle.
TerraCycle is an eco-capitalist pioneer. Instead of focusing on either saving the planet or making lots of money, we are finding ways to do both at the same time. Once we can prove that eco-friendly practices lead to more profitability (as others are trying to do, such as personal heroes of mine, William McDonough and Paul Hawken) more business will get in line and we will have a real chance at averting the potentially tragic future we have built for our children’s children. We’re working to eliminate the idea of waste by proving to the world that all things can be reused, recycled or upcycled. All we need is some thought, creativity and clever design!
Waste has historically had a negative value - we pay others to take it away. TerraCycle has flipped that notion on its head - we've found a way to turn waste into a valuable asset and a raw material.
How did the company get started?
The impetus for TerraCycle came when I realized the enormous untapped potential in waste. Waste is a human construct - nature would never preserve everything eternally in landfills the way humans do. Everything used to be part of an ongoing cycle of reuse, and I was inspired by nature to find a way to restart this process. Also, waste has historically had a negative value - we pay others to take it away. TerraCycle has flipped that notion on its head - we've found a way to turn waste into a valuable asset and a raw material.
Now the story: I was visiting friends back home during a break from Princeton, and found out they were composting common household materials and kitchen scraps, producing incredible fertilizer for their plants. While I initially saw composting as an alternative to landfills, I soon realized the huge value of developing reuse strategies for all manner of non-recyclable and non-biodegradable materials that litter landscapes around the world.
What is the significance of the name TerraCycle?
The name TerraCycle alludes to the natural cycle where everything is used and reused by the Earth and its inhabitants. The logo illustrates that this cycle is infinite.
What makes TerraCycle different from other companies?
We're doing so many things that haven't ever been done before - counterintuitive things that were deemed impossible until we turned them into a working business model. In our world, people can lead more sustainable lives without becoming environmental extremists. At the same time, they can raise money for schools and other non-profit organizations, simply for doing the right thing. It's also very important to me that the fundraisers and educational programs we run get people thinking about the small choices that will make a huge impact over the course of their lifetime. Most importantly, too many environmentally responsible companies, products and services are priced at a premium, making them inaccessible to the majority of Americans. TerraCycle strives to provide ‘greener’ alternatives without charging a premium.
What is the difference between upcycling and just creating more unnecessary junk?
By upcycling, we take a single-use item, such as a chip bag, and turn it into a durable product like a laptop case that can be used over and over thus vastly increasing it’s lifecycle. Plus, when you’ve finally wore out your TerraCycle product, send it back to us to be reused once again! There is already demand for items like the ones we make, and we are replacing the need to use virgin materials to create these products and instead using waste that has already been created.
Thus, TerraCycle’s process is reusing material that already has been created and would otherwise spend countless generations in a landfill and using that material to negate the need to use energy and resources to create new material.
We're doing so many things that haven't ever been done before - counterintuitive things that were deemed impossible until we turned them into a working business model.
What products have you made so far?
TerraCycle has already branched out in several directions from our plant foods, planting pots, repellents and other garden products. Our newest lines include pet products, home decor, cleaning products, school and office supplies and more.
How do you decide what products to make?
TerraCycle's design team creates a variety of prototypes, which we then present to retailers. Many of these products are eco-friendly variations of common products, since we're aiming to make a tremendous, positive environmental impact. The retailers we work with ultimately decide which designs to place on their shelves.
Basically it works any number of ways. We can start with a new type of waste material and figure out what it can be effectively used to build, that is, we determine what a used yogurt cup can be realistically made into. We also identify markets with a need for more environmentally responsible items and find ways to develop a product for that market. Lastly, a retailer says they need an eco-friendly version and we scramble to make said product.
Do you make the product prototypes and pitch them to companies or do companies come to you with ideas?
We do both. TerraCycle's work with PETCO is an example of the latter - we asked them what eco-friendly alternatives pet owners are asking for and used that input to create our pet-product line. This line has sold well and become a big win for TerraCycle. It's proof of the value in working with retailers rather than just pitching products to them.
We're just beginning to challenge people to rethink the way they consume and give them easy, incentive-laden ways to make progress that will benefit future generations.
What is the average age of your staff?
The average "TerraCycler" is in their 20s. It's valuable to have younger staff in some positions for several reasons - for one; we don't have the same ideas about what is impossible. The energy and creativity brought by the younger part of the TerraCycle staff breeds great ideas, and the more experienced part of the staff brings great direction and insight to the whole process. It also helps to keep work hours up and salaries lower (as compared to having to pay an MBA with 5 years of experience.) That said we have seasoned, experienced employees in key positions in our Finance, Legal, HR and Production departments. The younger staff dominates the sales/marketing/pr/design departments.
What do you think mainstream companies can learn from TerraCycle?
TerraCycle has proven that it's key to listen to what consumers want, run your business in a transparent manner, and find ways to integrate sustainability into as many aspects of your operation as possible. For companies that need a hand making an immediate change in sustainability, TerraCycle makes a great partner! Frito- Lay and Mars have recently chosen TerraCycle as a major component of their sustainability initiatives.
What are your dreams for the company?
I’ll risk sounding like a broken record because it's so important: Eliminate the idea of waste. We're just beginning to challenge people to rethink the way they consume and give them easy, incentive-laden ways to make progress that will benefit future generations. I'm very excited to bring this movement worldwide to make the greatest impact for all inhabitants of the Earth.
Do you think your business model is viable for other companies?
Yes! There is so much waste out there that the world really needs a couple more TerraCycles to handle all the different waste streams. Humans produce so much - a walk around a landfill, a recycling center, or TerraCycle will give a small window into the scale of the waste created on a daily basis. There is room for competition in the landfill, so put on those thinking caps, come join us, or start your own eco-revolutionary company.
Any future products you can tell us about?
We'll begin our international expansion over the next 12-18 months, starting with partnerships and products in Europe and South America. TerraCycle is also working with several new materials and developing new processes that we hope will revolutionize everything made from injection molded plastic. I can’t speak to it in any detail quite yet, but TerraCycle has found a process to turn garbage into a variety of green building materials.
You have a new TV show (Garbage Moguls), a new book (Revolution in a Bottle), and the coolest green company in the USA - did you think it would turn out like this?
Yes and no. I would be lying if I said I didn’t always hope and secretly have faith it would turn out so well. My advice to young entrepreneurs, if you don’t truly believe your idea has a chance to take you to the top, you should reevaluate your idea. They don’t all work out, but they should all have the potential.
That said, TerraCycle has been on the verge of bankruptcy before (like all start ups), my position as CEO has been challenged, we’ve been sued by huge competitors, so there have been times where I was preparing myself for the worst. All-in-all it has worked out better than I ever imagined, but I always knew the opportunity was there, I would have been a fool to drop out of Princeton and spend my life savings to start the company if I had not felt that way.
Anything you would like to add?
I hope everybody reading will become a part of our revolution and make the world a better place! You can get involved by signing up for our FREE upcycling fundraisers or check out our products finally available online at www.shopONLYgreen.com.
Visit: http://www.terracycle.net/
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written by ExchangeBase , July 22, 2010