Garbage: The next monopoly entrepreneurs will dismantle

New startups are creating competition in a previously closed system

The waste disposal industry is probably not something that the majority of us spend time thinking about, but that might be in the process of changing for good—and for the better.

Before we go any further, let’s take a moment to examine the situation: businesses everywhere generate trash. In turn, they essentially rent space in landfills to store that trash. Given the state of things, it’s little surprise that landfill owners aren’t that interested in looking for ways to recycle some of that trash when they can simply let it pile up—and charge us for the privilege. 

Meanwhile, that garbage is left to sit there, unattended, rotting, reeking and taking up space. There must be a better way, right?

As you might expect, bringing about any kind of positive—let alone lasting—changes in how we dispose of our trash would have to come from outside the industry itself. And therein lies the problem. As it stands right now, the nation’s trash disposal and storage is controlled by just two multi-billion-dollar corporations: Republic Services and Waste Management. However, if a successful new startup is any indication of the possibilities, smaller businesses may soon, finally, have a shot at breaking into this very lucrative and essential industry.

Take a look at Rubicon Global, a seven-year-old startup based in Atlanta, Georgia, with Nate Morris as the man behind the curtain. Rubicon doesn’t own any landfills of its own, nor any collection trucks. So what, exactly, is its product?

Instead of doing the legwork of hauling trash to the landfill, Rubicon hopes instead to become a sort of go-between for the businesses paying for trash removal and the landfill owners themselves. Morris’ goal for Rubicon is to help America’s businesses not only cut down on their trash management expenses, but also divert as much trash as possible before it can reach the landfill.

Rubicon has already secured contracts with nationwide chains like Wegmans and 7-Eleven, but a recent infusion of $30 million from investors should make it possible to expand their reach even further, with the ultimate goal of researching improved recycling technology. And just who are these investors? The Rubicon site provides five names: El Paso Advisors, QuarterMoore, Richmond Global, Rotunda Capital Partners, and Spouting Rock Financial Partners.

It would seem that the nationwide monopoly on trash management might be living on borrowed time. Rubicon is a very small operation in the grand scheme of things, but their success so far is encouraging.

Putting Incumbents on Notice

Since 2008, Rubicon has been instrumental in creating a marketplace where local haulers and thousands of other small businesses can, finally, bid on national contracts. This means that, in certain parts of the country where there was no choice in waste management services, there is now a burgeoning competitive field. This competition has, predictably, driven down hauling costs across the board.

The two big incumbents—Republic Services and Waste Management—boasted revenues of $8.42 billion and $13.99 billion, respectively, in 2014. Together, they’re a part of a $410 billion global industry. That’s according to Research First, and by 2020 that number is expected to rise—along with the demand for landfill real-estate—to $562 billion.

It’s little wonder smaller companies are looking for ways to get a slice of the pie. Unfortunately, this long-standing effective monopoly has made this all but impossible. In some cases, the laws governing municipal issues like public health, zoning, land use, and environmental concerns can be complex and difficult to navigate. Thankfully for Rubicon, their aim is to actually decrease the flow of waste into landfills. There shouldn’t be any significant hurdles, legally speaking.

This forward-thinking approach has earned Rubicon membership in the Initiative for Global Environmental Leadership, which has committed itself to disrupting a stagnant business model that will become even more unsustainable as the population of the country and the world continues to swell.

What the Future Holds

The secret behind Rubicon and their ambitious plan for leveling the waste disposal playing field is their software platform, which they have affectionately named Caesar. The system is responsible for recording and tracking the complicated relationships between clients, haulers, and recycling and disposal facilities.

But perhaps most crucial to the reinvention of our trash management methods is Rubicon X, which serves as the company’s Research & Development branch. This is where the company’s most recent round of funding is headed, and it’s where research into alternative recycling technologies are pioneered. Projects already in progress include dumpster-mounted cameras, which could provide a virtual (and visual) record of trash pickups as they happen.

The endgame for Rubicon, as well as the small businesses they’re partnering with, is to reduce our dependency on landfills and the monolithic corporations that oversee them. Eventually, Morris says, as we learn to more effectively deal with our trash, we may even make waste “obsolete.”

The remaining questions, naturally, are Why is this important? and Why is this happening now? Mostly, it’s because enterprising entrepreneurs have found a new market and are keen to exploit it.

But, as is the case with the Initiative for Global Environmental Leadership, which you’ll recall has partnered with Rubicon, the motivations are a little more selfless: keeping our waste out of the landfill is in everybody’s best interest. While we’re not exactly in impending danger of running out of landfill space, our trash does have to travel farther and farther the longer we rely on traditional disposal methods. This, in turn, contributes to higher greenhouse gas emissions.

But looking even further into the future, it’s clear that space on this earth is very much a finite resource, and we need to start looking at potential solutions long before we have a serious crisis on our hands. If we can do so in a way that promotes economic growth and competition as well as environmental pragmatism, so much the better.

(Image source: https://flic.kr/p/eRjo3W)