Will kiosks strategically placed in stores finally convince us all to recycle our gadgets and cell phones? Startup ecoATM (a Green:Net 2010 launchpad company) and its investors think so; on Wednesday, ecoATM announced it has raised a Series A round of $14.4 million in funding from kiosk giant Coinstar, Oakland, Calif.-based venture capital firm Claremont Creek Ventures, and venture debt from Silicon Valley Bank (SVB). (For more info on Green:Net 2011 in April, see here).
Coinstar, which runs businesses around kiosks that count coins and kiosks that rent DVDs (Redbox), backed ecoATM back in August 2010, and ecoATM raised its first round of financing from Tao Venture partners back in February 2010.
Cash for high-tech trash. That’s the basic concept for the recycling kiosk from ecoATM. You drop off old electronics at one of these machines; it calculates their value, then pays you on the spot, in cash or coupons. The company says its secret sauce is the kiosks’ ability to automatically estimate — using electronic and visual techniques — a price of the unwanted items that will give consumers an immediate financial incentive to recycle at the station.
As of the middle of last year, the three-year old company had built a network of 50 buyers around the globe that take the used consumer electronics devices ecoATM collects from its kiosks (from mobile phones to iPods to MP3 players to game cartridges) and recycles the components. ecoATM says it finds the best price for the devices, then passes a portion of that revenue onto its customers.
ecoATM aimed to deploy 200 kiosks across the U.S. by the end of 2010, mostly in electronics retailers, but I’m not sure of its latest figures. Typically, customers receive coupons for buying products in the store where the kiosk resides, and ecoATM then reimburses the store for the value of the exchange.
Incentivizing consumers to recycle gadgets and cell phones has been incredibly difficult. The EPA says that in 2005, the U.S. generated 2 million tons of e-waste and only about 350,000 tons of it was recycled. The remaining bulk ends up in landfills.
All that valuable waste has led to a flurry of activity in the recycling market, with a half-dozen startups launching web sites like SecondRotation, which help consumers find homes for their used goods (here’s a list of five such sites). The high-profile green VCs at Kleiner Perkins backed RecycleBank, which partners with cities to provide incentives for residential recycling.
ecoATM’s founder and former CEO Mark Bowles (now CMO) told me last year that he thought the website-as-recycling-center model doesn’t work. Most people don’t want to go through the hassle of labeling and shipping their used items and finding prospective buyers. ecoATM, he said, is all about convenience.
This morning, ecoATM says its kiosks in trial locations have collected “tens of thousands of devices” over the past year and paid out “hundreds of thousands of dollars in return for recycling.” In addition to the announcement about funding, ecoATM said this morning it has been awarded a Phase 1 grant by the National Science Foundation and the United States Patent and Trademark Office has granted the company its first patent on the ecoATM system.
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