Tom Szaky is founder and CEO of TerraCycle, a global recycling leader operating in 20 countries, working with major brands and retailers to recycle complex waste streams. He also created Loop, a circular reuse platform.

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Guest Resources

TerraCycle – Check out the website to explore Terracycle’s free recycling services, paid solutions, and reuse initiatives.

TerraCycle Invest – Click to learn about the investment opportunity.

Tom Szaky on LinkedIn – Connect with Tom on LinkedIn.

3 Value Bombs

1. Treat failure like tuition, learn from it, adapt, and avoid repeating the same mistakes.

2. Recycling difficult materials requires a business model that makes collection and processing financially viable.

3. Sustainability scales when it creates real business value and remains commercially viable.

Sponsors

HighLevel: The ultimate all-in-one platform for entrepreneurs, marketers, coaches, and agencies! Learn more at HighLevelFire.com!

Incogni: Your personal privacy advocate, handling removal requests across 420+ data broker sites. They can’t harm you if they can’t find you! Take back control of your personal data today. It’s completely risk-free with a 30-day money-back guarantee. Go to Incogni.com/fire and use code FIRE for 60% off an annual plan.

Show Notes

**Click the time stamp to jump directly to that point in the episode.

Today’s Audio MASTERCLASS: 25 Years of Recycling, the Unrecyclable, and Turning Worm Matter into a Global Empire

[1:37] – Tom shares something he believes about becoming successful that most people disagree with.

• The more innovative an entrepreneur is, the more failure they are likely to experience.
• Failure can be viewed like tuition: you invest in it, learn from it, and use those lessons to improve.
• The key is understanding what went wrong, adapting, and avoiding the same mistakes in the future.

[2:47] – Tom talks about how a college student turn worm poop into TerraCycle, a global recycling company?

• His entrepreneurial journey began 25 years ago during his freshman year of college.
• His friends discovered that worm poop, produced from organic waste, could dramatically improve plant growth.
• That sparked his fascination with garbage and the unusual economics surrounding waste.
• TerraCycle began by collecting organic waste, processing it with worms, packaging the resulting fertilizer in used soda bottles, and selling it through major retailers.
• The company eventually expanded from worm-based fertilizer into recycling difficult materials and, more recently, reusable systems.

[4:45] – Tom talks about what the original dorm-room conversation, “People will pay us to take their waste”, sound like.

• The initial business insight was that waste could represent negative-cost raw materials.
• Customers would effectively pay TerraCycle to take waste, which could then be transformed into a product that could be sold.
• That unusual economic model became part of the inspiration for building the company.

[5:20] – Tom tells why TerraCycle’s offices are made entirely from garbage.

• TerraCycle uses waste as the fundamental design rule for its offices around the world.
• Remnant carpet, old doors, wine barrels, refrigerator doors, soda bottles, and vinyl records are incorporated throughout the spaces.
• The offices bring the company’s mission to life while also providing an inexpensive approach to interior design.

[6:32] – Tom talks about what it actually take to recycle the “unrecyclable,” and why so few companies tackled it.

• The biggest challenge is understanding why a material isn’t being recycled in the first place.
• Recycling is generally performed by for-profit companies that need to make the economics work.
• Recyclers compare the cost of collecting and processing a material with the value of the resulting recycled material.
• Many everyday objects cost more to collect and process than their recovered materials are worth.
• The key to recycling difficult materials is finding a stakeholder; such as a manufacturer, retailer, or consumer, to fund the gap.
• Once the business model works, the appropriate technology and processes can be developed around it.

[8:43] – Tom tells why Terra Cycle choose to raise capital through a Regulation A offering instead of relying solely on traditional funding.

• TerraCycle initially raised traditional capital from venture capitalists, private equity firms, and high-net-worth individuals.
• Customers repeatedly asked whether they could invest in TerraCycle themselves, which helped motivate the company to open investment opportunities to everyday investors.
• Regulation A allows interested consumers to become investors while also giving TerraCycle experience with SEC reporting and public-company-style governance.
• TerraCycle has used these offerings to raise significant capital and hopes the experience could eventually support becoming a public company.
• He also shared that early investors have received dividends since 2018.

[11:09] – A timeout to thank our sponsors.

• Incogni: Your personal privacy advocate, handling removal requests across 420+ data broker sites. They can’t harm you if they can’t find you! Take back control of your personal data today. It’s completely risk-free with a 30-day money-back guarantee. Go to Incogni.com/fire and use code FIRE for 60% off an annual plan.
• HighLevel: The ultimate all-in-one platform for entrepreneurs, marketers, coaches, and agencies! Learn more at HighLevelFire.com!

[14:54] – Tom tells why vape waste become such an urgent environmental issue, and how does TerraCycle’s recycling program help.

• TerraCycle began working with nicotine-related waste by creating a cigarette-butt recycling program.
• Cigarette butts are a major source of roadway litter and contain plastic and chemicals that can enter the environment.
• Disposable vapes create an additional waste challenge because they contain lithium-ion batteries and electronics.
• When disposable vapes enter trash or recycling streams, their batteries can be shredded and cause fires.
• TerraCycle first launched a national vape recycling program in New Zealand, then expanded to Australia and the United States.
• The company has already collected and recycled large quantities of vapes and hopes to create similar impact with vape waste as it has with cigarette butts.

[17:46] – Tom talks about why throwing cigarette butts on the ground become socially acceptable.

• He emphasizes that cigarette-butt litter is still littering and should not be treated as acceptable behavior.
• Cigarette butts represent a significant portion of roadway waste.
• Littered cigarette butts can be carried by rain into streams, rivers, and oceans.
• The filters are made from cellulose acetate, a durable plastic material designed to trap carcinogens.
• TerraCycle’s cigarette recycling program works closely with Keep America Beautiful to address the broader litter problem.

[19:59] – Tom talks about how TerraCycle made sustainability practical and commercially viable.

• Commercial viability is critical to making sustainability initiatives survive and scale.
• Companies often don’t directly pay for the environmental externalities they create.
• Sustainability can therefore be advanced through mandatory government action or voluntary corporate action.
• For voluntary initiatives to scale, companies need a business reason to participate.
• TerraCycle looks for ways to demonstrate that sustainability programs can create business value, such as increasing customer traffic.
• When sustainability supports a company’s business goals, it is more likely to survive difficult economic conditions.

[22:20] – Tom tells the biggest myth about recycling that he wish would disappear.

• He believes the biggest myth is that recycling is a broken system.
• Recycling is a for-profit enterprise, not a universal public service.
• Recyclers generally process materials that can generate enough value to justify the cost.
• Thinking of recycling as “urban mining” or “waste for value” helps explain why some materials belong in traditional recycling streams while others require specialized programs.
• Understanding the economics of recycling provides greater clarity about what happens to materials after they are discarded.

[24:26] – Call to action.

• TerraCycle – Check out the website to explore Terracycle’s free recycling services, paid solutions, and reuse initiatives.
• TerraCycle Invest – Click to learn about the investment opportunity.
• Tom Szaky on LinkedIn – Connect with Tom on LinkedIn.
• Tom encourages listeners to explore the company’s free recycling services, which are funded by major brands and retailers.

[24:03] – Thank you to our Sponsor!

• HighLevel: The ultimate all-in-one platform for entrepreneurs, marketers, coaches, and agencies! Learn more at HighLevelFire.com!

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