'The biggest conversation would be around the economics'

“We are all about how do we rethink waste and to do that we have three business models. The first business model which operates under the TerraCycle-brand asks the question, if that object (a package, a product, b-to-b, b-to-c) is locally recyclable. Can the local garbage company profitably recycle it? We work with stakeholders like consumer product brands, retailers and cities. Our second division is focused on how we integrate recycled materials back into products. We focus on unique recycled materials that otherwise would not economically be competitive to virgin plastics on their own. For example ocean plastic, river plastics or plastics from natural parks or aboriginal communities and so on. We work with typical nature consumer product companies for who we create supply chains for these materials and then integrate that into their products. They create demand on supply chains that otherwise would not make economic sense to activate.”

“Our third division operates under the Loop-brand and focuses on how we shift away from a recycling based circular economy – what our first two divisions are – to a reuse-based circular economy. Loop’s basic idea is to work with brands who create reusable versions of their current products, and then retailers that embed that offer into their physical and digital stores.”

“Loop would cannibalize TerraCycle academically, but practically we are in such a massive problem with waste and packaging and so on, that I don’t think that you will ever see that practically happen inside. Last year TerraCycle had massive growth and Loop had massive growth as well. I think it all continues. Bur our hope is that we can keep shifting people to more circular choices.”

“What is really unique, is that the past two years the world has woken up to the problems of garbage. Three, four years ago people couldn’t understand ocean plastic, they didn’t understand how big the problem of single use plastics was, and really in the past two years the world has woken up. What that means, is that legislators are now passing more aggressive legislation. Consumers are waking up and looking for alternatives and that’s the carrot which would incentivize opportunities to innovate. Loop could not have been contemplated five or ten years ago. We would not have been able to get the response we have seen from the consumer product industry and the retail. In twelve months Loop has signed up a hundred major conglomerates and ten major retailers, that simply wouldn’t have happened five or ten years ago.”

Legislation

“The more government legislation the better. I have a funny feeling that most of the government legislation will come from Europe and you won’t see too much occur in other regions, especially not in the United States. I think that’s the culture of legislation. The more fundamental legislation, the better. We work a lot with legislators just to help them and to advise them.”

“I think CO2-taxing, whether you do it by an incentive mechanism or a penalty mechanism, is smart. Any legislation is smart. However, I would want to make sure, that the legislation doesn’t incentivize the wrong approach. For example: one of the big challenges for recyclers is that they have to compete against the price of virgin plastics. And in most cases that’s very difficult for them. A tax that might work well, could be a tax that taxes the price of virgin plastics and then give that tax over as a benefit to the price of recycled plastics. So that sets the competitive landscape: it’s easier to sell recycled plastic than it is to sell virgin plastic. That will be a monumental solution to this whole recycling problem. Everything would start working really well. And I run it, because today the opposite is true. Today, oil is subsidized. It’s not even a fair competition and the unfairness pulls them in the wrong direction.”

“The big challenge overall is that, while the world is waking up to the problem of garbage, the recycling industry is really suffering. The industry of recycling is in a lot of pain, because oil prices are cheap and that is competitive proxy to recycling materials. Also, end markets have stopped importing the waste. Indonesia and many, many countries have said they cannot import a lot of materials. The demand is going away. And most important: the quality of our waste is going down. If packaging becomes lighter - which is the big megatrend in packaging - it becomes less recyclable, because there’s less weight for packaging to get. And that’s of course the only thing that matters for recyclers: how many grams of plastic they have.”

"As it becomes lighter, it also becomes more complicated, because you have to spend more processing dollars to get less value. That is a massive big issue. And if you look at the big trends about companies wanting to create recyclable packaging, they are not addressing the economic problem, they are just trying to address the R&D-problem. They’re saying: let’s move from multilayer materials to mono-materials. That helps a little, but it’s not addressing the fact that that package has incredibly little plastic in it, which makes it very unattractive for a recycler to bother touching. Every time you reduce costs to the package, you are reducing the process to recycle. For example: water bottles have progressively become thinner, thinner and thinner. I totally understand the logic of why. But when I’m a recycler, I have to collect ten bottles a day instead of one bottle twenty years ago. And many recyclers are saying ‘fuck it’. Why bothering collecting the bottles if it’s not economically worth it anymore.”

Packaging design

“The conflict between light weight and recyclability is one massive issue. The second is: the main thing people need to be talking about is not the R&D around a package or around the process. I’m sure you’ve often heard chemical recycling is saving the world - and I think there is a role of chemical recycling. But it’s not a silver bullet. Instead of just focusing on the package technology and the technology of the process or the R&D of it, the biggest conversation would be around the economics. And the third big issue is the design of packaging. The waste management companies are not involved in the design of packaging and they are definitely not given the right to have an opinion on the packaging. And that’s why we are excited about Loop, because there the manufacturers have to design the packages into the rules of the waste management system. If they don’t, they don’t get listed.”

“I don’t say that Loop is THE future, anything is THE future. There’s no silver bullet answer. I think the future is a multitude of interesting answers. It is refill systems like Loop. It is packaging that doesn’t yet exist maybe, like de-packaging things and selling product naked. It’s a combination of incredibly good recycling and recycled content use, where appropriate.”

“We have to give consumers a wide range of choices and meet them where they want to be. With that said, I think that scale and economics are the most important. What I’ve learned in Loop so far, in seeing consumer behaviour, is that consumers would like more sustainable choices. No question. But they are still attracted to products first and for most by how affordable they are, how well they perform and how beautiful they are. Those three things are very selfish ideas, and they are not about saving the world. They’re about fulfilling our ego.”

“In cooperation with big consumer companies, we have gained a lot of consumer insights about reasons consumers will come to Loop. Two-third of the people came to Loop because of beautiful designed packaging and then say: oh, it’s also nice that things are reusable, cool! One-third come because they want reusable systems and then like the packaging which is really nice. So we need to play into, how the consumers are today.”

“The other key thing we learned in Loop so far, is that consumers like reusable systems, but they are struggling with the inconvenience of refill stations or filling at home, because you have to clean your packaging, you have to take it to a store and you have to fill it up. That’s quite inconvenient. So that’s another reason why in Loop we want it to feel disposable, we want you to have a disposable experience and that the system allows you to act reusable. When your packaging in Loop is finished, it’s dirty. You throw it away, you don’t sort, you don’t clean, you don’t do any of that stuff. You have a garbage experience, if you want.”

“In Loop we work with small manufacturers partnered up with the world’s biggest manufacturers and retailers, like Nestle, PepsiCo, Unilever, Mars, Tesco and Carrefour. We did that entirely because these companies know how to scale. That is such a key discussion with them and they’re all comfortable with enough volume that the economics will really work. That’s a key backbone of why we go after the really big companies. To think about what the factors are, right now we’re focused on the FMCG-sector (packaged food and beverages, home care and personal care, sold at big retailers), just because that is the biggest area. We are working on a partnership with one of the biggest fast food restaurants for reusable beverage containers, hamburger containers, French fries containers etc. Take away food is the next figure to focus on. You’ll see retailers (Carrefour, Tesco) where you can buy your Loop-products and then drop them off in fast food restaurants. Or you can buy your coffee in a fast food restaurant and drop the container off in the supermarket. You have got a network effect and, of course, the bigger, the more convenient.”