TerraCycle is a global recycling powerhouse making deals with dozens of the largest names in business.
TerraCycle is one company definitely set to make a few everyday investors incredibly happy. The company raised on StartEngine a number of years ago, and has since continued to gain prominence and quickly becoming a global recycling powerhouse. The company also issues a rather substantial yearly dividend, so investors actually get to share in the growth of this company as it sets its sights on an IPO. I believe TerraCycle’s equity crowdfunding raise was actually only for an investment for their U.S. Division, so it will be interesting to see how that translates into an IPO, however.
How Does TerraCycle make Money?
TerraCycle has a unique business model where companies typically pay TerraCycle to setup recycling programs then TerraCycle pays users to turn in various recyclable materials. TerraCycle then makes their money selling the materials to third party packagers for re-use. For example, TerraCycle recently partnered with Mr. Beast’s feastables chocolate bar brand. People then turn around and send in these wrappers to TerraCycle and paid at a rate of about $1 per pound of wrappers sent it. Now, this also works for Mr. Beast because he is likely to collect the most wrappers of anyone because he manufacturers them, then can collect them and send them in. Having a recycling program in place also looks good for his brand, helps them donate to charity, and its great for marketing because people or stores might buy more of his chocolate knowing they can turn around and sell the wrappers for a profit.
When I say “pay”, TerraCycle pays people in points, then those points can be redeemed for donations to charity, schools, and more. However, most companies elect to pay to a charity they own. So Mr. Beast donates to Beast Philanthropy, Taco Bell donates to the Taco Bell Foundation, schools that open these recycling programs donate to themselves, etc.
This is because Taco Bell will be one of the largest collectors of their Taco Bell sauce packets because they can simply be collected in their own restaurant. While there are individuals likely using this, the only way to make any amount of money would be a school, for example, opening a recycling program then collecting wrappers from their hundreds of students, or a businesses collecting their own recyclable materials.
TerraCycle has partnered with dozens of the largest brands in the world to help implement recycling programs. While it’s been subject to some controversy along the way, they have undoubtedly been a leader in this space and helped remove millions of pounds of trash from waterways. Some of TerraCycle’s partnerships include:
Arm & Hammer / Oxiclean
and dozens of others. This is just interesting because they are quickly acquiring some of the biggest names in the world and running and establishing their recycling programs.
While TerraCycle certainly wasn’t a small name when it listed on StartEngine, it’s certainly managed to substantially ramp up since their raise. They are consistently growing and announcing new, major partnerships. As it ramps up, hopefully the world becomes a greener place, and everyday investors see a win. With more and more success stories coming out, it’s clear that Equity Crowdfunding is only going to keep heating up and actually quickly becoming a hotbed for some of the hottest startups of the next decade.