120 million tons annually.
This is the amount of global electronic and electrical waste (eWaste) that will be produced annually by 2050 if current trends continue, according to a United Nations report.
As if this number isn’t alarming enough, UN data further reveal that less than 20% of the current 50 million tons of e-waste produced globally each year is officially recycled, leading to increased health and environmental risks as well as a significant loss of Valuable raw materials such as gold and platinum that end up with millions of tons of e-waste disposed of annually.
To meet the challenge, there have been increasing calls for a circular economy in which resources are replenished and reused, taking advantage of the growing consumer demand for sustainable and reusable products that reduce waste and are less harmful to the environment.
In this space, Berlin-based tech startup Grover is looking to make a difference with its technology rental platform, which aims to create a circular economy for consumer electronics where customers move from ownership to access and become more conscious about sustainable, affordable forms of technology consumption.
As a result of this sustainability-led shift from ownership to access, Grover’s solution to leasing technology in a flexible way – without having to pay for products up front – has mushroomed rapidly in recent years.
“Instead of buying a new phone every 18 months and then leaving it in the drawer, it’s becoming more important for consumers that they can use the device for as long as they need it, but then simply recharge it seamlessly to Grover and get a new one,” said Thomas Antonioli, Chief Financial Officer. Grover, for PYMNTS in an interview. “The old device is refurbished and reused, enabling it to effectively contribute to the reduction of electronic waste.”
Today, German tech company Unicorn, founded in 2015, offers subscribers access to more than 3,000 tech products — primarily smartphones and laptops, as well as smart home devices, virtual reality (VR) equipment, games and wearables — that they can switch. Or return or keep. On a flexible monthly rental basis.
In the wake of a sharp rise in demand for products like laptops in their markets – Germany, Austria, the Netherlands and Spain – as more workers switch to remote work, Antonioli said the upward trend has continued since then.
Flexible deals and reasonable prices
On average, subscribers pay about 45% of the retail price within one year of rental, which includes free insurance coverage that would have cost them a $10-$20 monthly fee on the purchased device, plus free shipping.
“[The insurance] It’s something you get for free in the subscription price, so you’ll pay less than half the price if you buy it with insurance,” Antonioli said.
For users who decide to keep renting for a longer period of time, they have the option to purchase the device for $1 when they reach 120% of the initial retail price in cumulative rentals. That deal amounts to paying “roughly” the same price to buy an iPhone with insurance cover, for example, he said.
The difference here is in the flexibility Grover gives users to end or upgrade their lease at their convenience.
“If you don’t [terminate or upgrade]The worst that could happen is that you pay as if you had financed the device and got a damaged cover included.”
Moreover, unlike traditional credit, subscribers who are under a contract but face personal problems such as job loss can return the device and not be liable to pay the remainder of the contract fee – “and this also makes it easier for people not to default,” he added.
Given the nature of the involvement in Grover’s business, ensuring that the company has a strong credit engine is key to reducing risk, he said.
This is why B2C enriches traditional data like the FICO score with new, alternative data sources, as well as its own machine learning technology that can analyze behavioral data based on how people move around the website, providing ‘measures’. credit [that] Much better than credit card information in Germany, for example. “
Create awareness about technology rents
The German company focused on the circular economy recently entered the embedded finance space with the launch of the Grover Card, which allows users to earn credits for their subscriptions. This has more than doubled the company’s annual recurring revenue (ARR) in 2020, creating opportunities to expand its portfolio of financial services.
Read more: IPO-based consumer technology company valued at $1 billion
As further evidence of the sector’s booming growth, the company recently raised $330 million in equity and debt financing at a valuation of more than $1 billion, with plans to increase the number of subscribers in existing markets and expand the circular economy to more countries.
The United States is one of those markets that the European company has targeted to accelerate its growth, having launched there late last year.
See also: After massive European growth, Grover brings technology leasing service to the United States
“We always knew this was going to be a huge and very important market for us at some point [and] We were positively surprised by how we were greeted there.
Spreading the word and creating awareness about the consumer electronics rental service and its benefits is one of the key areas that Antoniolli said Grover will focus on moving forward, particularly in markets where the concept remains relatively new.
“We will use the funding we have raised to raise awareness, because most people don’t even know it [the rental] So the option is there.”
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