Brightstar acquires majority stake in Flipswap

The deal will allow Flipswap to expand its consumer electronics buyback program to curtail e-waste

As more consumers upgrade their mobile phones to keep pace with lightning-fast smartphone innovation, more handsets are ending up in landfills despite efforts by environmentalist groups to curtail the amount of e-waste that’s disposed of improperly. To this end, some companies have cropped up to provide e-waste disposal and handset buyback programs, with some pretty encouraging results (turns out, people are more likely to be mindful of their environmental impact when they find out they can get cash for it). Flipswap is one such company that has developed a consumer electronics buyback program, and the company has just made an influential new friend in Brightstar Corp., a services and solutions provider for the wireless industry. Brightstar announced Monday that it has acquired a majority stake in Flipswap. The terms of the deal were not disclosed.

Launched in 2008, Flipswap allows mobile phone owners to trade in their working or broken phones for cash, and its platform has diverted some 210 tons of e-waste from landfills to date. Cell phone owners simply go to the Flipswap website, look up their device to get a price quote (example: a 16 GB iPhone 4 runs for $307.44), choose a payment method, and then print out a prepaid shipping label to ship the handset out to Flipswap. The company issues a payment, and everyone wins. In some cases, the company will even pay for broken cell phones.

From there, Flipswap either sells the device back to retailers or operators to resell at lower rates, or, in the case of a damaged device, recycles it. 

Of course, Flipswap is not the first player in this field. As new phones come out, old phones are tossed, which has inspired a number of companies to team up with activist groups to clean up e-waste disposal. Back in February, EcoATM raised $14.4 million in a Series A round led by Coinstar and Claremont Creek Ventures for its innovative ATM-like kiosks, which can be placed in any brick-and-mortar store to allow consumers to sell their old phones for cash. The kiosks instantly identify the device, scan it to check for damage or bugs, and then offer the owner a cash price for the device. If the owner accepts the offer, the cash is dispensed instantly. 

"As consumers continue to keep pace with the latest technology, the average initial ownership of a wireless phone is about 18-months, but a phone's full lifespan is much longer," said Marcelo Claure, chairman and CEO of Brightstar Corp., in a statement. "We're seeing an increasing demand for buyback and trade-in programs for retired handsets that will extend the lifetime of the device, coupled with an increasingly important environmental benefit. Flipswap is at the forefront of this movement."

Brightstar acquired a majority interest in Flipswap for an undisclosed amount, with the company’s remaining interest left to Flipswap. The deal will allow Flipswap to utilize Brightstar’s network of existing relationships to work with operators and retailers in its efforts to buy back, refurbish, and resell handsets. Brightstar provides over 100 customized services to what it calls “key participants” in the wireless device value chain, including value-added distribution, supply chain, retail and enterprise and consumer services.