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| Edited By: Ashish K Tiwari |Source: DNA |Updated: Feb 12, 2019, 06:30 AM IST
A little over two-year old start-up Recykal is an end-to-end cloud-based, full-service waste and recycle-enabling technology that focuses on sustainability by connecting waste generators, processors and recyclers. The platform also facilitates buying and selling of recyclables like industrial waste, e-waste and plastic waste among others and has prominent names in retail, technology, automobile and real estate sectors as its clients. Abhishek Deshpande, co-founder, Recykal, in conversation with Ashish K Tiwari, speaks about the company's business, formalising an informal sector and more. Edited excerpts...
It was during my stint in the hotel industry as a pre-opening specialist/ expert with Accor Hotels. I observed that a lot of unnecessary waste was getting created in the form of finished/ unfinished water bottles from conference and banquet functions. One day I saw a waste picker come, collect the waste and go away. I started studying the entire cycle and conducted my own research on the subject. This was around three years ago. There always was an interest in doing something of my own and I began thinking on this idea. Frankly speaking, I had no clue about the government's extended producer responsibility (EPR) at the time of launching Recykal. It was only in 2017 that I got to know there was something called EPR too.
It definitely is and we spent a lot of time understanding how this works and what are the pain points. I'll give you a case study. There is a 58-year old individual in Pune who deals in waste and that is his family business. He works with all the five-star hotels in Pune. He came all the way to meet us in our Hyderabad office and express his concerns with the family business. He'd started losing accounts that have been with me for the last 30 years because the hotels started asking to see the certificates of where the waste is going. He has now partnered with us and his son now looks into all the technological associated with collection, tracking and disposal of waste collected from the hotels.
Every business owner is concerned about their enterprise and the way they deal with wastage. The plastic ban enforced last year created a havoc for the informal sector because they couldn't just dispose it off anywhere. So this gentleman is now our partner in Pune and he has even introduced out technology solution to other kabadiwalas in the city by holding a biryani party. Our app is compatible with regional languages, including Telugu, Marathi, Hindi and so on. He now tells the other kabadiwalas that you schedule a pick up only then will my vehicle come and pick it up. Earlier the vehicle will get out in the morning and make stops at every shop even if there is no material to pick up. Now with our solution the system helps in route planning which helps him save fuel cost. He has even taken us to all the big hotels and showed the app while also demonstrating things like the environmental impact, invoices and tracking etc. all in one place? He's won back the all the hotel accounts. This is what I call the real disruption.
Absolutely. In fact he's got a four acre land parcel and is building a recycle point. He has partnered with one another person and started building this warehouse. We are also exploring similar facilities with him for Nagpur and Ahmednagar markets. So you see, our technology is helping such people. We understood he is belongs to the informal economy and is already doing the business. We are just enabling him with the technology to do it better and in a manner that's in sync with the changing times.
We have started giving our technology to every stakeholder including government bodies. The government's Swachha Sarvekshan initiative led to a lot of these bodies wanting to track their data. It becomes much easier to collect data at source using our technology compared to manual paperwork. Here we sort of become the producer responsibility organisation (PRO) because brands want somebody to take care of this.
Similarly, companies like Dabur, Hindustan Unilever etc. they can't go to Amritsar or Assam because they are sending their material there. It's important to get material collected in that region also, it shouldn't happen like ITC has a target of 1,000 tons target for multilayered plastic (MLP) collection as per EPR. It's not going to work if they collect 1,000 tons from Maharashtra alone. Every state pollution board will want to know how much they have collected from their state. And as per the EPR its not just materials they have produced that has to be recycled, but conducting awareness campaigns in every state. The easiest way of doing that is through digital medium and the extensive mobile penetration help do exactly that.
For instance, if DNA admin is using this platform and gets all its employees involved, then we have a reach out, which the brand wants. We have a solution/ digital mechanism that is ready to plug and play. Then there are take back programs that need to happen, where we help them with the digital part. This is done through our UZED app which can run an individual take back programme. Suppose you have a Samsung phone, iBall keyboard and one more device. Now due to our consolidated thing, logistics will work. But only a Samsung phone collection will not work. So we collect everything and EPR targets are taken care of. We inform the brand that these many devices have been collected against your EPR targets, this is the detail, this is the recycler and this is the certificate of destruction. So we are a PRO also and we are the only PRO who is digitally doing this. There are a lot of PROs in the market, but nobody is using digital technology yet. Advantage of us is that many PROs only do the paperwork, but we have built the platform first and now are capitalising on that as a PRO.
Yes we are. It comes into the picture i.e, there are a lot of waste management companies and there a lot of corporate social responsibility (CSR) initiatives going on like ITC runs WOW, which is in western, southern and northern parts of India. Then there are so many waste management companies they will need traceability. ITC as a company needs to track where is all that waste is going, waste management companies can take advantage of the dashboard and all data in one place for reports. Clients are spending money, so they want to see the reports. We provide our platform as SaaS for anyone who may need.
One is SaaS as I told you, it's a monthly fee that what we charge. Secondly we give consistent supply to recyclers, and they pay us a percentage akin to a marketplace commission. Third is the Pune case study we discussed earlier, since he is getting business from us, he is paying us on a material basis, whatever material is flowing through our platform, he pays us a certain percentage. And lastly for e-waste and plastic there is EPR, which is a big revenue stream. They also pay basis material, so whatever material is being processed by the recycler, for that the brand has to pay. For Digital awareness they have to assign certain budgets to us. As per their budgets they will pay us for physical programs, take back programs, maintaining their microsites etc. So there are are the multiple revenue streams. Basically, there was no digital tech to deal with all this and that's where we found an opportunity. It is a $500 billion dollar market, where every stakeholder needs a transparency and trust factor that we can offer.
We are still in the investment mode so will be difficult to give a certain number. We've invested $1 million to just learn the game all by ourselves. It is an ongoing learning process and not something that can be made and said it's done. We did all this in parts. First we targeted households and built the app, then we created the bulk generator technology piece, then the aggregator piece and then started connecting them. We are still developing and building the platform. EPR is now getting integrated into the existing platform which brands will use as they want complete visibility, government also wants complete visibility. Now that the base is ready, opportunities along the line are coming up. We feel there is a lot of EPR opportunities, and that's why we are coming to Mumbai as well because there are so many brands.
We are in Hyderabad and Pune and now coming to Mumbai. Implementation teams have started work in Bhopal and Indore, Jaipur and Bangalore. Target is to achieve six cities by March 2019. We are aligned to the target.
We haven't yet frozen on the number, but we will look to raise a large sum sometime in the next fiscal. That's because we want to reach eight more cities, so a total of 14 cities for which we will need capital. Once the fun raise happens, we will then be able to plan an aggressive pan India expansion.
