This serial entrepreneur uses a B2B model to recycle truckloads of trash

Abhay Deshpande's firm Recykal currently collects over 10,000 tonnes of garbage a month from schools, colleges and commercial set-ups, and plans to take it to 100,000 tonnes soon.

Using technology to solve one of India's age-old problems, Hyderabad-based Recykal, which describes itself as the "Uber of waste collection," is on a mission to ensure trash is recycled responsibly instead of being dumped as is. 

A serial entrepreneur, Abhay Deshpande earlier founded marketplace Malamall.com in 1997, and an enterprise-class multichannel commerce platform Martjack in 2007, which was acquired by Capillary Technologies in 2015. 

After these two ventures, the computer science engineer wanted to build a startup once again. Only this time, it was with a specific purpose, and Deshpande knew very well that the risk of failure was also high, given that waste collection is a highly informal, cash-driven sector. 

"Waste management is the problem faced by all. The decision to set up an enterprise to address this issue was triggered when I was shifting residence. I found so much stuff that we never used but it had been lying in the house for years. That's when I thought of recycling it to enable the circular economy," he explains.

Recykal has an app called Uzed, which is a marketplace where customers can schedule waste pick-ups.

"Right now, we are B2B (business-to-business) and engage with offices, schools, colleges...(which) create a pickup request and we connect them to recyclers, MSMEs (micro, small and medium enterprises) or cement factories that use plastic for energy generation," said Deshpande. 

Working with ragpickers in 2017, Recykal initially used its app to collect waste from residential houses and deposit refuse at recycling centres. However, the unit economics for Uzed weren’t sound, since households are not massive waste generators on a daily basis and the amount of refuse collected wasn’t enough for recyclers. 

Recycling waste involves multiple parties—ragpickers, waste collection centres, municipalities, recyclers, and bulk waste generators that include schools, hotels, restaurants, factories, and shopping complexes.

Realising that one product or app could not cover everyone’s needs and particularities, Recykal rejigged its business to approach bulk waste generators and pivoted to a B2B model in 2019, where it built products for everyone involved in recycling. 

Recykal then created a new app for companies to send waste pickup requests that include details such as the quantities and types of garbage. The company then sends ragpickers who transport this waste to different collection centres, where it is sorted.

"We have 10,000-plus metric tonnes of material getting recycled through our platform every month, and are on track to clock over 100,000 metric tonnes waste being recycled through Recykal," said Deshpande.

With over 50 enterprise customers including Amul, Decathlon, UNDP, Tata Beverages, Panasonic among others, Recykal plans to channelise 300,000 metric tonnes of waste through its system in 2021.  

Recykal clocked a top line of over $10 million this year, and aims to reach $1 billion in revenue in the next 2-3 years, says Deshpande. 

Deshpande is confident of achieving this goal aided by the Extended Producers Responsibility, a rule mandated by the Ministry of Environment, Forests and Climate Change in 2016. The rule stipulates that the primary responsibility for collection of used multi-layered plastic sachet or pouches or packaging is of producers (which includes manufacturers, importers and users), who introduce the products in the market.

"They need to establish a system for collecting back the plastic waste generated due to their products," the rule says. It also asks producers to recycle a certain percentage of the plastic waste generated by them. 

"This has started formalising the (waste collection) economy," said Deshpande, likening EPR to how demonetisation ushered in the use of digital payments. 

Apart from the use of its app, Recykal also uses technology in several different ways. 

It has a Smart Centre Solution that helps waste aggregators, dry resource collection centres (DRCCs) and material recovery facilities to digitise their day-to-day activities such as record keeping, settlements and transactions, giving complete visibility of collection centre operations

Its Deposit Return Scheme Solution, is cloud-based system that helps governments and smart cities deploy and manage DRS schemes digitally with an app-based collection and payments mechanism. It also has an EPR Loop,  a digital exchange for brands to ensure their EPR fulfillments.

The company has received funding in the past from Triton Investment Advisors, the family office of Ajay Parekh (Director, Pidilite Industries), Vijay Acharya (former Managing Director, Bank of Singapore) and Circulate Capital.