With a population of more than 1.3 Bn, India currently stands on a pile of $8.3 Bn (INR 56,000 Crore) worth unused goods as per a recent OLX study. And this does not include recyclable waste such as newspapers, plastic, obsolete mobile phones, etc. All of this together result in a considerable amount of recyclable and reusable waste which is collected and disposed off in a highly unorganised manner.
Interestingly, despite the hype created around people selling on online platforms, at the foundation of this industry, still rests the much unorganised class of ragpickers, kabadiwalas, and garbage collectors. Jaarvis Accelerator-backed ExtraCarbon, is trying to organise this space by bringing the consumers and waste pickers on a single platform.
Gurgaon-based ExtraCarbon was launched in year 2013 by Gaurav Joshi and Anant Avinash. The inspiration came from the UK’s resource management practices through waste management. They are currently working with a team of 28 people.
The founders call the garbage and waste pickers as Green Super Heroes team and are trying to solve three basic problems with them. “Despite a massive population, the recycling industries in India have to import more than 50% of recyclable waste. ExtraCarbon, from the ecosystem point of view, is solving the problems of collection, optimisation and scalability,” said Gaurav.
ExtraCarbon optimised their Green Super Heroes team by providing more deals and greater sale value with them. Domestic waste collection was an issue as majority of raddiwallas/kabadiwalas don’t have enough money to buy everything.
As their business was majorly dependent on cash to solve the scalability issue, they introduced reward points called Jhoomley. The users can opt for payment in cash or points. These points can be further used to top-up their mobile phones or DTH, pay electricity bills, buy products and groceries, or get Paytm credits. “Where for waste pickers, it reduced the burden to carry large amounts of cash (often borrowed from loan lenders), for users, it generated more alternatives to utilise the perks from selling their waste materials,” added Gaurav.
ExtraCarbon collection centres segregate the items for recycling & send them to the concerned recyclers. Other reusable goods are sold in the secondary market or to individual buyers, thereby making margins on every sale in the market.
Current Traction And Challenges
At present, ExtraCarbon is buying 400 different items, both recyclable or reusable. That includes old furniture, TV, mobile phones, newspapers, etc. Users can request pick up through website. If the team finds any item that is not already trading on the portal, they take a minimum of two hours to give a quote to the user.
Initially, adding new users and non-acceptance from Resident Welfare Association was a very big challenge for them. People considered them as regular kabadiwalas and it was difficult to change this perception. However, with the launch of their website, things started to improve.
At present, they are doing 100 daily pick-ups across 7 cities, viz. Noida, Ghaziabad, Delhi, Gurgaon, Lucknow, Ludhiana, and Patiala. With 21000 active users, it clocked a revenue of INR 1.71 crore last year. To date, the founders have raised INR 2 Crore funding from two angel investors and Jaarvis Accelerator.
Competition And Future Plans
In terms of competition, Gaurav believes that since they are working on an asset light model, thereby co-existing with this class of Green SuperHeros, ExtraCarbon has better and faster growth prospects than their competitions.
ExtraCarbon plans to achieve a revenue target of INR 6 Crores by the next financial year. Also, it aims to increase its daily pickup number to 500 before Diwali this year. Next month, they are also planning to bring a mobile app to help GSH team in identifying users and raising electronic invoices.
According to some estimates, India’s recovered paper industry is worth $297 Mn (INR 2,000 crore) and demand of paper mills is expected to grow at a compound annual growth rate (CAGR) of 9.6% till 2017. In 2015, top 10 newspapers in the country qualified an average sale of approx. 24.4 Mn copies in the period of July to September. Also, the Indian packaging industry is expected to reach $32 Bn by 2020. “As our business runs through lot of industries, it will be safe to say right now this market is worth $20 Bn,” said Gaurav.
Other players in this space include Raddi Express, Kabadiwala, Rekart, Pompom, Kachrapatti, Zero Waste and more.