Americans aren’t exactly good at recycling food they don’t eat — in fact, 36 million tons of food waste was generated in 2011 alone.
Now, two former Microsofties want to reduce that number and fix a growing problem with their new startup, WISErg.
Founded in 2010, the 18-person Redmond-based company helps grocers and restaurants turn food scraps into organic, usable fertilizer with its “Harvester” machine. WISErg has developed technology that intercepts nutrients still existing in food waste, which then can be used for local agricultural farming.
“We believe that new, technology-based approaches and community-based environmental education will lead to a scalable, sustainable solution that can both reduce food waste and capture and reuse the nutrients in food scraps,” said 47-year-old CEO Larry LeSueur.
LeSueur co-founded the company with former colleague Jose Lugo, and the ex-Microsofties recruited an experienced microbiologist in Victor Tryon to help develop “The Harvester,” which can already be found at PCC Natural Markets in the Seattle area.
We caught up with LeSueur to find out more about WISErg in the latest edition of Startup Spotlight.
Explain what you do so our parents can understand it: WISErg is a hybrid technology company combining bio-, clean-, and high tech systems to convert urban-generated organic waste into valuable, organic fertilizer that can then be reintroduced into the food chain.
Inspiration hit us when … We realized we wanted to change the industry’s view of organic waste disposal options, not follow previously set rules. What if we looked at food scraps as a resource rather than waste? This opened up new possibilities and helped in the creation of what we believe is a revolutionary approach to urban organic excess that provides a closed loop within the food industry: from grower to grocer to consumer and back to the grower in the form of organic fertilizer.
VC, Angel or Bootstrap: WISErg is supported by angel investors. These investors match our passion for creating new technologies that solve widespread ecological problems.
Our “secret sauce” is: The Harvester, the company’s smart technology offering, enables grocers and commercial kitchens to significantly reduce the amount of inventory loss, otherwise known as shrink, of discarded food scraps generated by their organizations. For the unavoidable portion, the patent-pending technology controls a process that extracts nutrients through oxidative conversion, and uses them to produce a locally based, natural agricultural fertilizer. We have a solution that produces no organic waste.
The smartest move we’ve made so far: One of the best moves we’ve made so far has been to partner with PCC Natural Markets (the first Harvester was deployed at the Issaquah store). This organic grocer is just as committed to solving the problem of food waste as we are, and we’ve been able to fine-tune our product with data and operational experience we’ve received through the PCC site. And it’s a two-way street: we’ve been able to provide reports generated by the Harvester to PCC, which is helping the store reduce its shrinkage.
The biggest mistake we’ve made so far: Early on, anaerobic digesters (AD) seemed to be the right answer for organic waste processing. This technology was getting great traction across Europe and momentum was building in the U.S. as well. Universities were buzzing about the technology. Digesters turn a waste product into energy…what could be better?
Well, there are lots of challenges with digesters in operations: proximity to the waste streams, specificity of the waste stream, offensive odor, and fundamentally, they are very difficult to justify economically without a level of subsidy. We went down this path and realized that the company could never scale because of these limitations, among others. Energy was a great story but hard to rationalize if it requires more energy to bring in the feedstock than what was being generated.
I’m still a big supporter of AD systems, but their application needs to thoughtfully consider the net output of the system (including transport) before claiming environmental benefit. That was a year set-back for us as we considered how to pivot and stay aligned to the company’s vision of being an environmentally positive AND a profitable company which does not rely on subsidies to scale.
Would you rather have Gates, Jobs, Zuckerberg or Bezos in your corner: Why limit to one? I’d take them all. Kidding aside, today, at this moment for where we are, I’d pick Jeff Bezos. We are preparing to scale, or “get big fast,” so it’s about laying a foundation for the future. Lots of strategic decisions have to be made today that will impact profitability in years to come. Bezos gets this concept of taking a traditional brick-and-mortar business and applying technology, while still offering product (it’s not just a software play). It’s disruptive. It’s a challenge to pull off because it requires not just thinking out of the box, but operating out of the box on a daily basis.
A call out to the others…at our inception, I would have liked to leverage Bill Gates, I recall a statement (paraphrased here) that he once made in a meeting: “Don’t apply resources to fix today’s problem if you can use those resources to change the paradigm and eliminate the circumstances that created the problem.” This is the premise at the foundation of WISErg.
From Steve Jobs: It’s about simplicity, don’t over complicate the user interaction. The technology does the work, the user sees the magic. I’d look for his influence on product design and moving the Harvester into an everyday appliance — that is an ongoing process at WISErg as we continue to push on the engineering front.
And as we prepare to scale, I’d tap Mark Zuckerberg. There is power in social connections and building momentum to tell the story. When you have a great concept, people telling your story can be your biggest asset. WISErg has a great story that needs to be told.
Our world domination strategy starts when: It’s already begun! Harvester has more capabilities than just solving the problem of how to reuse urban-generated food scraps. Through its network-based technology and its data collection functionality, the Harvester can help facilities reduce energy consumption, give managers a heads up if employee training needs improvement and actually improve profitability in industries plagued by low profit margins (grocers and food service).
Rivals should fear us because: The WISErg team is composed of technologists, scientists and business people. Together, we’ve created a solid business strategy that is laser-focused on a single, challenging aspect of sustainability — it will be tough for any competitor to penetrate a similar market. Think of it as our force field.
We are truly unique because: The Harvester’s technology is complementary to composting, but uses a different approach by intercepting nutrients from food scraps before they become waste. This patent-pending, proprietary oxidative conversion process is completely natural and does not produce any harmful by-products or emissions. It’s a unique methodology for creating the most nutrient-rich fertilizer approved for organic food production. It’s also cleaner and more adaptable to urban environments than traditional composting.
Additionally, the Harvester collects and digests vast amounts of data; through reporting capabilities, it gives the user valuable insight into such areas as energy usage, security, shrinkage and more.
The biggest hurdle we’ve overcome is: The regulatory (waste) environment. Many of the regulatory agencies have a fiduciary responsibility to protect both our citizens and our environment, specifically around handling of waste. Existing processes and disposal methods, when not properly managed, are plagued with rodents, odors, and present risks to public health. The agencies are naturally risk adverse (worse than most investors), especially when a new, not well understood, process is presented … plus they are bound by pre-existing laws that mandate specific requirements applicable to these legacy systems that constrain innovation.
Our effort to introduce a different approach and educate the appropriate agencies (while preserving our intellectual property) was a real challenge and a long journey. Fortunately, there was a real desire for change by leaders within these agencies that propagated downward to work on implementable ideas and ensured that newly written legislations supported and allowed for innovation. I believe WISErg is the poster child for how Washington State, specifically the Department of Ecology, is enabling thought leaders to turn waste streams into resource streams.
What’s the one piece of advice you’d give to other entrepreneurs just starting out: Be steadfast in your vision. Take small steps that are measurable and ensure progress. However, on the execution: be flexible and pivot early, fast, and often to course correct on implementation, people, and partners.