For this recycling king, waste is ‘a magical place to play’

November 29, 2023 | By Vicki Hyman

Tom Szaky loves to talk trash. Like, literal garbage.

“Everything we possess — the pen you’re writing with, the watch you’re wearing, your notebook, the chair you’re sitting on — will become legal property of a garbage company. It’s the only industry in the world that will own it all. Legally.”

Szaky, a shaggy-haired, hoodie-wearing 41-year-old with more than a passing resemblance to rocker Dave Grohl, leans forward. “It’s the only material item that has negative value. The legal definition of garbage in many countries is ‘a commodity you will pay to get rid of.’” And the waste management industry? The least innovative industry per dollar of revenue, he says.

“Waste looks like it hasn’t changed in a very long time, because it hasn’t,” Szaky says. “It is highly unexplored because of its repulsive nature. And that, to me, is like this magical place to play.”

Szaky is an evangelist for waste — or, rather, the elimination of it. As founder and CEO of TerraCycle, the Trenton, New Jersey-based recycling company, he has long championed recycling the hard to recycle, including snack packaging, toothpaste tubes, water filters, wetsuits, and, starting earlier this year, plastic payment cards through a partnership with Mastercard.

We produce twice as much plastic waste as we did two decades ago, and only 9% of single-use plastic is recycled, according to a 2022 report from the Organization for Economic Cooperation and Development, the global policy forum. Much of it does not decompose, clogging landfills and polluting waterways. When incinerated, it pollutes the air and can harm our health.

Recycling plastic cards is difficult, because so much tech is packed into such a small package, including a microchip that helps process transactions, a wire antenna that enables contactless payments, and a counterfeit-resistant hologram. And then there’s the problem of the plastic itself. Most of the 25 billion payment cards in circulation are made of PVC and other first-use plastics, which can take hundreds of years to decompose.

Mastercard has already announced that it will use sustainable materials in all new payment cards starting in 2028, and more than 388 million Mastercard cards are now made from recycled or bio-sourced materials. But that doesn’t address the payment cards already in the wild. So earlier this year, Mastercard created a blueprint for a recycling program that could be adopted by any issuing bank worldwide. The company has been testing this program using card collection boxes developed by Mastercard at select HSBC branches in the U.K.

That’s where TerraCycle steps in. The card collection boxes double as shredders, ripping the cards into 265 tiny pieces so no card information can be stolen. TerraCycle and its contractors separate the waste and re-form it into pellets and powders to be reused for other products.

But recycling is actually just a means to an end. The company’s mission, Szaky says, is to eliminate the idea of waste altogether.

Here’s the problem: The company your municipality hires to recycle your plastic soda bottles, tin cans and newspapers could also recycle more complex materials like your toothpaste tubes, aerosol cans and coffee pods, but it doesn’t make financial sense for them to do so. So we toss them in the trash.

Since 2001, when Szaky founded the company as a freshman at Princeton University, TerraCycle has been researching and implementing ways to efficiently collect, process and recycle waste. And it all started with the original waste stream: poop. Worm poop, specifically.

Worm farm to workspace

Szaky was born in Iron Curtain-era Hungary but grew up in Canada, where his parents eventually settled after fleeing the Eastern European country in 1986. Moving from communism to the heartland of capitalism, Szaky fell in love with entrepreneurship early, starting his first company, a graphic and web design outfit, at 14.

At Princeton, he took an introductory economics course where the professor asked the students, “What’s the purpose of business?” Her answer seemed reasonable enough: to maximize profits for shareholders.

But Szaky wasn’t convinced. “Profit is important, but maybe it’s not the point,” he recalls thinking. “Maybe it’s the indicator of health. So you have to be profitable to grow, thrive and live. But that leaves room for the purpose being something else, something that hopefully benefits the world in some way.”

That something, he decided, would be waste.

Szaky had seen how much food waste the Princeton cafeteria generated, so he started a composting effort using worms, whose nutrient-rich castings can be used as fertilizer. He packaged these into empty soda bottles — eliminating the need for new plastic packaging — and sold them to large retailers for use as plant food.

Where we’re sitting — Szaky motions beyond his “office,” separated from the rest of the large workspace by empty green and white soda bottles strung together and suspended from the ceiling — this was all worm poop production and bottling. “There was an ambient noise of worms moving around, like hands rubbing, you know, like things rubbing against each other,” he recalls. “It was very therapeutic.”

But poop, he eventually realized, wasn’t the point.

Building an empire on waste

Szaky instead drilled down on one innovation that arose from his fertilizer business: the recycled soda bottles. Rather than obtaining them from a recycling facility, where they were often deformed, TerraCycle had launched school brigades to collect bottles in better shape. And Szaky realized he could apply that approach to any waste stream.

In 2007, the company began its brand-sponsored recycling programs, starting with companies that produce juice pouches, yogurt cups and snack wrappers. If a juice pouch manufacturer has partnered with TerraCycle, say, parents can collect a month’s worth of empties in a box, download a free shipping label and send it to one of the company’s partner facilities, which then breaks down the juice pouches and recycles them into the raw material for a variety of other products.

The Trenton headquarters, a low-slung office building to which graffiti artists are regularly invited to ply their craft inside and out, is a living lab of that potential. In a rear courtyard, the color-flecked “gravel” reveals itself to be tiny pellets made from discarded flip-flips and cork. Employees can lounge on Adirondack chairs and benches that might have once been cosmetic packaging or coffee capsules. An elephant sculpture reveals itself to be a creative assemblage of retired tires and floor mats, courtesy of one of the product designers on staff.

Inside, Ernie Simpson, the company’s chief scientist and head of research and development, shows off framed collages of potato chip packages and juice pouches that have been turned into dog food bowls, watering cans, messenger bags and even a cushioned toilet seat.

Simpson is an applied physicist by training whose team — chemists, engineers, statisticians, computer scientists — develops the processes to break down these difficult-to-recycle materials. “All my professors used to say, ‘When you do physics, there’s nothing else you can’t do,’” he laughs. “When you’re a physicist, you have a tendency to understand how things operate.”

For credit cards and other plastics, the materials are often shredded, sorted, melted and extruded into pellets, flakes or powders that can be used to fabricate other materials. Metals can be smelted into sheeting and ingots, rubber cryo-milled into powder for flooring applications. Dirty diapers can — wait, what?

“Tom is always thinking about the more difficult ones,” Simpson says. Turns out the filling of many disposable diapers is made of plastic. Once the “biologicals,” as Simpson delicately puts it, are removed, the filling can be decontaminated with gamma radiation and then composted for fertilizer for non-food uses.

“I’m the kind of guy who will not say, ‘You know, we can’t do it,’” Simpson says. “Until I run an experiment, I won’t tell anybody that I can’t do something.”

(There are some materials that TerraCycle hasn’t been able to conquer. Sandpaper, for example, will literally grind the equipment you use to take it apart.)

The future of flotsam

In 2019, TerraCycle launched a new platform for tightening the virtuous circle of recycling by working with brands and retailers to encourage shoppers to shift from single-use to reusable items.

As consumers, Szaky says, “we want the product but we don’t want the package, but we buy the package and then throw it away.” Through TerraCycle’s Loop initiative, the brand owns the package. When it’s empty, the container — a bottle of shampoo, say — gets shipped back to the manufacturer, sterilized, refilled with more shampoo and sold again. Once it’s used and bruised (perhaps a hundred circuits, the company estimates), it can then go into the recycling stream.

If successful, Loop could cannibalize TerraCycle’s recycling division, which is its largest and most profitable. “I would be ecstatic if that could happen. It means TerraCycle has done really well as a business, and we’ve really had a profound change … I don’t see it in my lifetime. But I would love it. You know? Absolutely.”

Photo of Tom Szaky courtesy of TerraCycle. Other photos: Vicki Hyman, Mastercard

Vicki Hyman, director, communications, Mastercard