Terracycle: Outsmarting Waste

1048 Words Mar 25th, 2014 5 Pages
TerraCycle: Outsmarting waste

1. Upon what basis did Szaky make decisions throughout the development of the venture?
Tom Szaky is an entrepreneur, known for starting TerraCycle, a company that makes consumer products out of waste. Although the environment and the venture itself changed a lot throughout the development, Szaky always remained true to himself. He believed that a waste management business could make a profit and promote environmental protection at the same time. However, gut instincts and being in the right place at the right time was also an important issue for the former success - commencing with the idea for the startup business when he visited his friends and discovered the fertilizer which they had developed. Shortage
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TerraCyle turned down the money from the capital firm because they were not interested in the environmental benefits of the product and wanted to cut out the rest of the team.
A turning point in the startups business was the idea of packaging their product in used plastic bottles – now they could offer a product made from garbage packaged in garbage. The new challenge was getting notable retailers to introduce their unknown and maverick product. They managed to get an order from Walmart for 100.000 bottles which was much more than the average order volume. TerraCycle could fulfil the contract under greatest efforts and proved that eco-capitalism is functioning. The next major step was the defining of a new business model, called sponsored waste. Together with Kraft Foods the startup began to made products from recycled materials. The partnership developed fast and leads to enormous strategic challenges because of the huge amount and storage requirements which involve high costs. TerraCycle still has to work hard to produce a profit and struggles with the wide range of activities and products they offer.

3. What business is TerraCycle actually in? Do you think the company needs to change its business model? Why or why not?
The primary business function of TerraCycle was manufacturing and selling compound fertilizer. Related to their

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