Updated: One man’s trash is another man’s treasure, and Carl Rush is the go-to guy about opportunities with garbage. He’s the Sr. Vice President for Organic Growth at Waste Management (s WM), where his mission is to explore new and greener technologies for handling waste streams. And he’s Waste Management’s point man for startups and is responsible for the half dozen investments the company has made over the past three years.
So, yeah he’s been busy. Waste Management wants to double its renewable energy production (via biogas production) to a point where it could be able to provide power for as many as two million homes and also wants to triple its recycling capacity over the next ten years.
Rush is leading the team that is going to make that happen and pulling along any startups that can help him along the way. Rush tells us “the day of dumping everything in one truck, hauling it to one place and dealing with it in one fashion,” is over. Here’s an edited interview with Rush.
Q: So what is the future going to look like?
A: We’re focused on making our material reclamation more efficient and more discrete, and then we’re looking at how to convert those materials into chemicals or products of higher value.
We were able to identify those materials that have scale and value and develop those into something that’s a viable market. We’re making a lot of different investments around organics and organic processing, for example. Roughly 35 percent of the material we manage is green waste, food waste and that kind of stuff. There’s value in that, there’s real resources there. When you look at the value of a ton of organics being composted as mulch and compare that to the value of using the same material to get 70 gallons of gasoline, there’s a big difference in the value there.
Q: So you’re investing in startups that can help you make the leap from the value of compost to the value of gasoline with the resources you collect?
A: This isn’t a high-growth industry let’s face it. But if we can get more value out of the materials steam than anybody else, we should be the leader in it. That’s where we’re trying to head.
Q: You recently invested in a startup called MicroGREEN. Tell me about that.
A: MicroGREEN has the ability to insert tiny bubbles in the skin of recycled PET. It allows you to close the loop on PET by taking it from bottles to make cups and food containers and to keep recovering that material and producing new things from it. When we first invested in it they were still very much on the drawing board. We see that the demand for recycled PET will be very high. Some people are already looking at making blister packaging from PET.
Q: What do you bring to the financing syndicate beyond money? Is there anything a startup can get from working with you that it can’t get anywhere else?
A: Part of our effort is taking some of these small technologies, like a MicroGREEN, and taking them to scale. It’s neat to have all these wizbang things, but it’s getting them to where they can do something that matters. That’s the sort of things that we’re focused on, achieving scale. It’s a very industrial effort. It’s not a high tech effort. It’s hard to make that work. It’s not easy. We’re still in an industry where you have to educate the consumer, maintain the logistics, move the materials and execute.
Q: You’ve really driven the investing that Waste Management has done. Is there any stage of development you focus on or deal structure you prefer?
A: As we’ve become better known out there, we’re seeing different deals than we saw a year or two ago. The structure has never been the defining element for us. It’s been about whether we think the technology has a place in what we’re trying to do. If it’s a fit, we’ll figure out a structure that makes sense. We’ve never gone in with the structure as the lead.
Q: So why is Waste Management interested in technology startups now and wasn’t say, five years ago?
A: A lot of the technologies we’re talking about today wouldn’t have been economic or weren’t advanced enough to see where you could find value. The development has been phenomenal. It’s come from universities and entrepreneurs as well. A lot of bright people have put their minds to work on these types of problems and it’s starting to pay dividends.
|Date||Startup||What It Does||Involvement|
|May 2010||MicroGREEN Polymers||Blows air into PET to make it stronger and more resource efficient.||Made a $6.9 million investment syndicated with venture firms..|
|May 200910||S4 Energy||Developing plasma gasification facilities.||The company is a JV between WM and InEnTec.|
|June 200910||Big Belly Solar||Makes a solar-powered trash compactor.||Big Belly entered into a distribution agreement with WM.|
|Jan 2010||Harvest Power||Recycles organic material into renewable energy.||Made an undisclosed investment with Kleiner Perkins.|
|Feb 2010||Enerkem||Converts municipal waste and biomass into cellulosic ethanol and other fuels.||Invested in a CDN $53.8 million financing round with Rho Ventures, Braemar Energy Ventures and BDR Capital and others.|
|August 2009||Terrabon||Converts waste to fuel using an acid fermentation process that converts biomass into organic salts.||Made an undisclosed investment syndicated with Valero Energy.|
Alexander Haislip is the author of “Essentials of Venture Capital,” out this autumn from John Wiley & Sons.