|Rohan (left) oversees the sourcing of e-waste and marketing. His elder brother, Nitin, supervises the entire operation|
"To succeed, you need to motivate each member of the team, from the peon to the senior-level manager."
E-learning: What would you do with an old laptop? Probably sell it for a few thousand rupees. But 29-year-old Rohan Gupta had his eyes on crores. Which is perhaps why Attero Recycling, an e-waste management company, was born. In 2007, Rohan’s elder brother, Nitin, 30, gifted a new laptop to him. So Rohan began scouting for environment-friendly ways to dispose of the old one. This search metamorphosed into a bigger project when he discovered that India had produced 3.8 lakh tonne of e-waste in 2007, but that no one seemed bothered about it. In the massive pile of junk, Rohan saw an opportunity.
He shared the idea with Nitin, who was equally excited about it. The brothers belong to a business family and nurtured the desire to be entrepreneurs. Rohan had even tried his hand at it in 2005 as one of the founders of an online movie rental company, Cinesprite. The inspiration for Attero couldn’t have come at a better time. Rohan was thinking of quitting Cinesprite, and Nitin, who had a cushy job with a tech incubator, Lotus Interworks, in the US, wanted to return to India. “Most aspiring entrepreneurs wait for the one workable business idea. For us, this was it,” says Rohan.
|Rohan Gupta, 29||Nitin Gupta, 30|
|Education||BE, Regional Engineering College, Jaipur||B Tech, IIT Delhi; MBA, New York University|
|Previous work experience||Infosys, SAP||Lotus Interworks, USA|
|Last annual salary||Rs 6 lakh||Rs 35 lakh|
|Age at starting business||29 years||30 years|
|Years as entrepreneurs||10 months||10 months|
|Initial investment||Rs 25 crore|
|Source of funding||Venture capitalists|
|Turnover||Rs 225 crore (projected for the next two years)|
|No. of employees||17|
High on research: It has been a tough journey, beginning with the planning. There was no Indian recycling company to use as a yardstick. So the brothers began looking at foreign business models, in particular, across Europe and the US. There were several things to consider, including the technology for processing e-waste, the logistics of setting up junk yards, etc. But they were on their own when it came to the most important aspect: revenue generation. Unlike their counterparts abroad, Attero did not expect to be paid by companies or households to manage their e-waste in the short term. In fact, they are doing the paying currently and shall continue for a few years. So they focused on making money through recycled products.
One issue that had the brothers at variance was the scope of the recycling facility. While Nitin wanted to outsource the recycling of non-ferrous metals and plastic, Rohan insisted on reprocessing every part. “Then we realised that there was no company to outsource it to,” says Rohan. Also, economy of scale demanded an extended process to give the company more end-products. After a few months of research and aided by Nitin’s work experience, the brothers formulated a business plan.
Fishing for funds: When it was time to hunt for venture capitalists (VCs), Nitin quit his job and moved back to India in March 2007. The brothers live as a joint family, so financial cushion and emotional support was abundant. “No worries on the home front meant that we could concentrate on Attero,” says Nitin. But they returned empty-handed after meeting two VCs. “There was a sector mismatch. The VCs we approached were not interested in funding a start-up in this field. It is a new industry in India, so they were sceptical about the chances of success,” explains Rohan. Finally, NEAIndoUS Ventures and Draper Fisher Jurvetson agreed to put in a seed capital of nearly Rs 25 crore. A significant portion of this amount was spent on acquiring technology.
Laying the foundation: After the VC funding, preparations stepped up, with focus on team building, primarily the research and development section. As the business requires several government licences, Rohan and Nitin spent hours in government offices, explaining to officials the importance of such a unit. Meanwhile, the team was scouting for land to build the factory where e-waste would be processed. They zeroed in on Roorkee because of the tax breaks offered by the Uttaranchal government and it’s proximity to Delhi, a major source of e-waste.
Also high on their priority list was renting warehouses in all the metros and setting up offices in crucial collection centres such as Bengaluru, Mumbai and Chennai. “Simple things like setting up an office or opening a bank account in the company’s name were difficult,” says Rohan.
Cautious start: Attero Recycling became operational in February this year. The brothers were prepared to face processing glitches and costs exceeding the estimates. But none of it happened. “The biggest challenge turned out to be sourcing the e-waste,” says Rohan. Their plan was to target corporates first as the collection costs are lower. The brothers have struck a deal with many companies, but it wasn’t easy. “The companies don’t even know which department handles ewaste. For some, it was the IT department, for others, the HR section,” says Nitin. Attero has collected about 500 tonnes of ewaste, which will begin to be processed this December. The processing will add another 100 workers to their rolls. “The target is 10,000 tonne for the first year. We are in talks with several companies and NGOs to increase the intake,” says Rohan.
By mid-2009, they hope to operationalise the collection centres for households. To ease the process, people can register on the company’s Website (www.attero.co.in) and Attero promises to pick up disposable gadgets. Initially, individuals will be paid, but as with the corporates, the brothers hope the trend will reverse. Given the fact that India is a dumping ground for the developed world’s e-waste and considering its own growing pile, the industry holds huge potential. The brothers seem to have stepped in at the right time. Currently, they are focusing on awareness campaigns that state: Don’t throw it away. Because Attero Recycling plans to collect—both e-waste and a fortune.
• Research the field thoroughly as it will help you formulate a convincing business plan.
• Always maintain a cost cushion of at least 10%. It will make sure your budget never goes haywire.
• Nurture each team member. In the initial years, they will probably do double their share of work.
• Choose VCs who have a prior experience in funding start-ups in the same sector.