Even the largest landfills in Indonesia are at (or close to) capacityand the government has set an ambitious target of 30% waste reduction by 2025. Waste4Change is one of the companies that wants to help by increasing the recycling rate and enabling better waste management. The startup, which currently manages more than 8,000 tons of waste each year, announced today that it has raised $5 million in Series A funding co-led by AC Ventures and PT Barito Mitra Investama.
Other participants in the round include Basra Corporation, Paloma Capital, PT Delapan Satu Investa, Living Lab Ventures, SMDV and Urban Gateway Fund. Founded in 2014, Waste4Change has a CAGR of 55.1% since 2017 and is present in 21 Indonesian cities, where its services are currently used by approximately 100 B2B customers and more than 3,500 households.
Waste4Change was founded by founder and CEO Mohamad Bijaksana Junerosano based on talks between PT Greeneration Indonesia, an NGO, and waste management organization PT Bumi Lestari Bali (ecoBali) to form a company that will reduce the amount of waste that ends up in landfills. Junerosano is an environmental engineer by training and has worked in the solid waste industry for 16 years.
Junerosano says a big opportunity is created by Indonesia’s low recycling rates (around 11% to 12%), meaning it leaves a lot of valuable recyclable material behind.
“Waste reduction is a top priority, followed by material optimization and recycling that support the concept of a truly circular economy,” he told londonbusinessblog.com.
Waste4Change will use its new funding to expand and increase its waste management capacity to 100 tons per day over the next 18 months, aiming to reach more than 2,000 tons per day over the next five years.
The Waste4Change team
Junerosano said Waste4Change differentiates itself from traditional waste management solutions by providing an end-to-end solution, with a focus on sustainability and zero waste. Part of its strategy includes increased digital integration to monitor and record the waste management process and automate its material recovery facilities.
“We see digital integration as a valuable tool to build a sustainable waste management ecosystem,” he said. “The goal is always to create harmony between the environment, the economy and the people.” Waste4Change’s digital integration strategy this year and next includes improving the waste journey report and monitoring, which customers receive after their waste has been processed.
To use Waste4Change, customers can request a collection team to collect or drop off their pre-sorted waste. The company currently has 108 employees and 141 waste managers, with plans to add an additional 52 people to the team and partner with 300 informal waste collectors and SMEs. Informal waste collectors include scavengers, waste banks, waste stalls and waste collectors.
For recycling business partners, including informal waste collectors, Waste4Change is building a platform to help them sell and buy solid waste with the company. The aim is to increase the traceability and accuracy of the waste management process. It is also working on a program called Send Your Waste, where consumers can send waste to Waste4Change collection points. An app tells them what kind of waste to send, where the nearest collection point is and what reward they can receive.
Junerosano says informal waste collectors tend to be selective about the materials they collect, picking out PET bottles, glass and cardboard. But this means that less desirable materials like PP plastic, multi-layer packaging and Styrofoam often get left behind and pollute the environment. To counter that, Waste4Change has started a service called Afvalkrediet, which provides incentives to collect certain materials and also makes it easy for waste collectors to build this business.
“Given the critical role of the informal sector in improving Indonesia’s recycling rate, we want to build a waste recycling platform that will keep the system sustainable,” he said. “We are more than happy to bring it to life with a joint venture or joint operation with other industry stakeholders, including those in the informal sector and local Reduce, Reuse, Recycle (3R) temporary waste storage sites.”
In a statement, AC Ventures founder Pandu Sjahrir said: “Waste4Change is a pioneer providing an end-to-end waste management solution. Sustainability is the main focus of the team, with a proven commitment to building a better future for Indonesia. The company is proving that it has achieved product-market fit and has the potential to scale up across the country.”