Indonesian waste management startup Waste4Change has raised $5 million in a Series A funding round, co-led by AC Ventures and PT Barito Mitra Investama, the firm announced on Friday.
Basra Corporation, Paloma Capital, PT Delapan Satu Investa, Living Lab Ventures, SMDV, and Urban Gateway Fund also participated in the round.
The startup plans to utilise its fresh capital to increase waste management capacity to 100 tonnes per day in the next 18 months and reach more than 2,000 tonnes per day over the next five years. The plan also involves integrating more technology into monitoring and recording processes of the waste management flow and automating material recovery facilities.
“We see digital integration as a valuable tool to build a sustainable waste management ecosystem. The goal is always to create harmony between the environment, the economy, and the people,” said the startup’s founder and CEO Mohamad Bijaksana Junerosano.
The climate-tech startup’s digital integration plan in 2022 and 2023 focuses on the improvement of waste journey reports and monitoring.
“We plan to further implement our plan in two of our programmes: Recycling Business Platform & Send Your Waste programme,” Junerosano continued.
The funding will also help Waste4CHange strengthen partnerships with players in the informal waste sector, which is currently powered by scavengers, waste banks, waste stalls, and waste aggregators.
Founded in 2014, Waste4Change offers various services, including consultation [research and studies related to solid waste], campaign [capacity building, education, and mentoring], collect [daily waste collection service], and create [waste recycling, EPR of extended producer responsibility, and waste credit].
“Our major income stream comes from B2B and B2B2C services. The investment value of each service is calculated in a project-based scheme. The rate will depend on the size of each project, project complexity, duration, community involvement, and other resources needed,” said Junerosano.
The company currently operates in 21 cities, managing more than 8,000 tonnes of waste per year. It partners with more than 100 enterprises and over 3,450 household clients. The startup has been growing at a CAGR of 55.1% since 2017.
“We provide waste collection and recycling services for IKEA, DBS Bank, Unilever, and Potato Head. UNDP also has been trusting us as their partner in solid waste study and research for some of their projects in Indonesia,” the CEO added.
Waste4Change currently has 108 employees and 141 waste management operators. It plans to add another 52 people to its team and engage more than 300 informal workers and SMEs in the waste sector.
With more than 270 million population, Indonesia is a significant contributor of waste in SE Asia but the country’s recycling rate is low at 11-12%, according to the ministry of environment and forestry. This opens up an opportunity for startups like Waste4Change to create solutions to tackle the waste problems.
“We are working with the best venture capital players in the technology sector. All of our investors take ESG seriously and are willing to share their insights with us in creating the best waste management solutions,” said Junerosano.
Public awareness of waste management has increased over the past few years, which is shown through a slew of startups in this sector such as Rekosistem, Octopus, Kertabumi Recycling Center, Mall Sampah, and Universal Eco. Junerosano believes that competition is a good thing as more players mean more great minds to share insights and collaborate with.
“Waste management is a dynamic thing that tends to follow the economy and lifestyle of a society. We do hope that the best method will always be there to answer all the problems that arise in the future,” Junerosano said.
Pandu Sjahrir, founding partner at AC Ventures, said, “The company is proving that it has reached product-market fit and has the potential to scale across the nation. The timing is also ideal as the Indonesian government wants at least a 30% reduction at source, with the remaining 70% treated by 2025.”