eRecyclingCorps is a mobile device trade-in service based in Kansas City that just landed seed money. What’s the next move?
eRecyclingCorps recently landed more than $100 million in seed financing. The company was launched by former Sprint executive Ron LeMay and offers mobile device trade-in and re-use solutions. Mary Bristow, vice president of marketing and communications for eRecyclingCorps, recently appeared on Power Lunch with Krista Klaus to talk about what the cash infusion will mean for the tech company.
Krista Klaus: Tell me about eRecyclingCorps.
Mary Bristow: One of the best ways to explain what we do is to talk about how we were created. A number of years ago, David Edmondson and Ron LeMay had a company called Easy Sale, which collected old product—old stuff from businesses and residences—and sold it on the Internet. It was an eBay type of concept.
One day, David was sitting on the loading dock; one of his favorite things to do in the afternoon was to watch what was coming in. He called himself the “Fred Sanford of the Internet.” And in came a box of old phones, and he said to his guys, “What are we doing with these? These are not worth anything.” And they said, “Actually, they are.”
He sat back and thought, “Well, they’re a couple of years old. People paid a couple hundred dollars for them.” But he said, “Wait a minute. The customer paid $200 for them, but the carrier paid much more.” And there started this whole concept of capturing and monetizing the value of used devices.
KK: So tell me exactly how the process works.
MB: [For] most people, their phones are between 20 and 24 months old. If they have a smartphone, they’re worth quite a bit of money. So you go into any one of those stores, and you’re offered a value that oftentimes is equal to the value of phone you want to buy, or you can buy an accessory, or you can apply it toward your bill.
KK: The space is really growing. Many more online retailers or exchanges are entering the picture. But you are not online. You need to walk the device into the store.
MB: We are a carrier-based program. We have programs with three of the top five carriers in the U.S. and two of the top four in Europe. We are in about 16,000 retail locations to date globally.
We start our programs usually with a pilot and then expand to all retail locations, and then sometimes into online for the carriers, business-to-business, but we are carrier based within the store, integrated into the point of sale.
KK: Where are your locations in Kansas City and how many storefronts do you have?
MB: We certainly have locations in Kansas City because three of the top-five carriers have representation in KC … We are at every one of those major carrier locations in Kansas City.
KK: What will the latest round of funding do for eRecylingCorps?
MB: We are really excited about the latest round of funding for a couple reasons. All of our existing investors re-upped their current investment in our company, which really validates and reinforces the power of this proposition. In addition, we added a new, very large investor, Silver Lake Kraftwerk, which is a very large global technology investor. Kraftwerk itself—its strategy—is focused on new resources and innovation.
KK: Tell me more about OpenAir Equity Partner’s role in this.
MB: Ron LeMay was a founder with David. Ron is our chairman, and they are very involved (with OpenAir). They have been involved from the beginning. They were also involved in this third and final round of financing. When David was at Radio Shack and Ron was at Sprint, they built the first Sprint in-store concept within Radio Shack and worked together for many years. As they began to develop this idea of capturing the value of used devices, they really looked at technology in general and the eWaste that was being generated and a solution to that. We’ve collected to date 17 million phones since we were founded in 2009, which is significant and is equivalent to over 7 million pounds of e-waste that’s being diverted, so it’s a significant endeavor that we are all very excited about.
KK: What will you use the cash to do?
MB: This is growth capital that we intend to use to do some acquisitions, to expand our geographic footprint and to develop new products for our carriers, our customers and partners.