Meet Indonesia’s Uber for garbage collection

This week, On the Rise dives into Indonesian waste management firm Octopus’ revenue growth, and explores Southeast Asia’s plastic credit market. [Read from your browser]( On the Rise 🚀 Welcome to On the Rise! Delivered every Tuesday via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and trends in emerging tech. If you’re not a subscriber, get access by [registering here](. Written by Shadine Taufik Journalist Hello {NAME} The recent death of Queen Elizabeth II imbued me with a renewed interest in London’s history. From the Roman Londinium built on the banks of the Thames to the exploits of King Henry VIII, London’s over 2,000 years of existence is filled with color and drama. However, what interested me the most were the stories related to city planning and resource mismanagement. Particularly, [the Great Stink]( and [Great Smog]( come to mind, with both resulting in thousands of deaths in the city. Reading into these events, I pondered whether they would happen again in the near future - which threw me down a nihilistic rabbit hole. After all, humans are creating [more plastic waste than ever]( with only 9% of it being recycled. Moreover, [nine in 10 people]( globally breathe highly polluted air, and [governments continue to struggle]( to coordinate on climate financing. So when I saw this week’s Big Story by my colleague Nikita on how Indonesia-based greentech startup Octopus is willing to take matters into its own hands, I felt somewhat relieved. This Grab Ventures Velocity alumnus offers waste pickup for consumers in exchange for points, which can be traded for electricity tokens, data packages, and vouchers. It also offers waste management data, which is sought after by corporations. What’s notable is how Octopus saw a 26x revenue growth in the past year and how it has been profitable since its inception. But Octopus is not the only greentech firm in the ocean with good business prospects. In this week’s Making Waves, I look at Southeast Asia’s plastic credit companies and how they could be greentech’s next big thing. -- Shadine  --------------------------------------------------------------- THE BIG STORY [Indonesia’s ‘Uber for waste’ finds profits in garbage collection]( Octopus has witnessed 26x revenue growth in the past year and plans to expand to other countries in Southeast Asia in 2023.  ---------------------------------------------------------------  MAKING WAVES  Trash for tokens: plastic credit firms take on Asia’s garbage problem Here’s what happened: - Asia is bearing the brunt of the world’s plastic garbage crisis. - This has inspired the creation of plastic credits firms in the area, many of which have reached profitability relatively swiftly. - With the greentech industry projected to reach up to US$55 billion by 2027, this new generation of startups could potentially relieve waste burden while raking in high revenue. Here’s our take: Startups have popped up across Southeast Asia to pitch in with greentech solutions. As developed economies add to [litter in the region’s landfills with their garbage exports]( and countries in Southeast Asia often lack the proper infrastructure to handle this trash in addition to their own, a looming crisis prevails. One of the most recent iterations of greentech currency is the plastic credit. With each token bought, a company or individual is able to offset a ton of plastic waste by funding green initiatives. Not surprisingly, the global greentech market is [projected to reach]( up to US$55 billion by 2027, skyrocketing at a compound annual growth rate of 25% to 30% within this period. Startups in the greentech currency sector often additionally handle the organization, collection, and processing of plastics in partnership with community initiatives and waste management firms across the globe. Often, these companies also help pioneer infrastructure and systems for plastic recycling. Startups such as the Philippines’ [Plastic Credit Exchange (PCX)]( Indonesia-headquartered [Waste4Change]( and Vietnam-based [Tontoton]( work with companies and governments to consult on and offset plastic waste to meet [ESG]( commitments. These firms, along with a handful of others, work with waste management initiatives both locally and across continents, offering credits to fund these projects. Across these companies, the price of a plastic credit could range from US$100 to US$2,500, depending on the project. Both PCX and Tontoton are bootstrapped, and they each have around 20 full-time employees. However, though they are both small and relatively new - PCX and Tontoton were founded in 2018 and 2019, respectively - these firms are profitable. Meanwhile, Waste4Change has seen 10x revenue growth in the past year, the firm told Tech in Asia Although several firms have dedicated collection centers, players in this space act as primary connectors between traditional stakeholders in the waste management sector and companies. Plastic credit firms create value from their network of corporations, waste collectors, and processors, in addition to their tech-traced quantified impact. The business model requires relatively low overheads, making the path to profitability faster. Regardless of the success these firms have seen, this sector will face challenges. “Plastic credit, as it is a new kind of environmental commodity, still has to strongly prove itself as a solution rather than a tool for greenwashing,” says a spokesperson for Tontoton. “For better or for worse, we inherited a lot of baggage from the carbon credit space,” says PCX founder Nanette Medved-Po. Critics of carbon credits believe that purchasers feel authorized to emit more greenhouse gases when the goal should be to cut them. Additionally, projects such as tree planting are [not direct solutions]( to reducing emissions, as it can take up to 20 years for the plants to capture the promised amount of carbon. The same concept can be applied to plastic offsets. Additionally, credit systems may sometimes lack direct impact. For example, companies may fund projects in other countries but continue to pollute their local areas. Another possible disadvantage is the processing of waste. Though a large portion of it is recycled, many projects choose to use plastic as an alternative fuel source, which generates greenhouse gases. Firms such as PCX recognize this, which is why they often urge businesses to reconsider their usage of plastics. Through its nonprofit consulting arm PCX Solutions, the company pushes businesses to reduce plastic use - which goes against its for-profit plastic credit company PCX Markets. In spite of this, businesses at both ends of the argument seem to agree that purchasing plastic credits is better than inaction. -- Shadine  --------------------------------------------------------------- FYI [TaniHub’s future precarious amid C-suite exits, fresh allegations]( The company has seen all of its C-level executives depart, as well as a host of leaders that had been helming its troubled P2P business unit TaniFund.  --------------------------------------------------------------- NEWS YOU SHOULD KNOW Check out Tech in Asia’s coverage of the emerging tech scene [here](. 1️⃣ Indian math-focused edtech startup Bhanzu has [bagged US$15 million]( in its series A funding round. Founded by Neelakantha Bhanu, who is known for being the world’s fastest human calculator, the firm is using its fresh financing for global expansion, product development, content building, and hiring. 2️⃣ Koltiva, an Indonesia-based agritech firm, has [raised an undisclosed amount of funding]( which will be used to develop its fintech and marketplace platforms. The firm tracks movement of goods for agricultural companies, promotes environmental protection, and provides advice to farmers with the help of agro-economists. 3️⃣ Malaysia-based drone firm Aerodyne has [raised US$30 million]( in a bridge round led by Petronas Ventures. 4️⃣ Philippine cloud kitchen company CloudEats has [received US$7 million]( in its latest funding round, which it will use to further develop its own brands. 5️⃣ Sprout Solutions, an HR payroll startup from the Philippines, [has acquired]( local process automation platform Linnia for an undisclosed amount. The platform will provide Sprout users with seamless procurement and HR automation features.  --------------------------------------------------------------- That’s it for this edition - we hope you liked it! Do also check out previous issues of the newsletter [here](. Not your cup of tea? You can unsubscribe from this newsletter by going to your “edit profile” page and choosing that option in our preference center. See you next week! [ADVERTISE]( | [SUBSCRIBE]( | [HIRE]( | [FIND JOBS]( P.S. Don't miss out on the biggest tech news and analysis. Add newsletter@techinasia.com to your address book, contacts, or safe sender list. Or simply move us into your inbox. Too many emails? Switch to a different frequency or get new content through our [preference center]( or [unsubscribe](. You can also break our hearts and remove yourself from all Tech in Asia emails over [here](  Copyright © 2022 Tech in Asia, All rights reserved. 63 Robinson Road, Singapore 068894