Asian-focused venture capital firm Gobi Partners announced a strategic investment in Electronic Recycling Through Heroes (ERTH), a local leader in electronic waste (e-waste) recycling based in Malaysia, as part of its ongoing commitment to invest in circular economy-centric companies. L8 Ventures is also a co-investor for the round.

What sets ERTH apart is its dual-fold approach. The company not only facilitates responsible e-waste disposal but also rewards contributors with cash incentives or vouchers. This approach fosters a community-driven commitment to environmental preservation while providing economic compensation, Gobi Partners said in a statement on Monday.

ERTH achieves this by employing a gig-economy workforce of over 1,000 freelancers, referred to as “Heroes”. These Heroes play a pivotal role in collecting obsolete, faulty, and discarded electronics, such as laptops, smartphones, printers, televisions, and various devices, directly from households and businesses.

Since 2019, ERTH Heroes have collectively diverted more than 1,000,000 kilograms of e-waste from landfills. To put this into perspective, it is equivalent to 1,053 Perodua Myvi cars or 13 Boeing 737 aeroplanes. As a result, the Malaysian Department of Environment has recognised ERTH as the largest authorised collector of e-waste in Malaysia.

Thomas G. Tsao, Co-founder and Chairperson of Gobi Partners said, “Our alignment with ERTH’s expansion strategy demonstrates our dedication to driving transformative change. Through this partnership, we are not just investing in a company; we are contributing to a more sustainable and environmentally-conscious future.”

As a symbolic gesture of this new beginning, Gobi colleagues has also collected their electronic waste, including used mobile phones, batteries, laptops, blenders and even an air conditioning unit which were then handed over to ERTH for proper disposal. This initiative is closely linked to Gobi’s Corporate Social Responsibility program, #GobiCares, addressing both community needs and environmental concerns.

Established by the husband and wife team of Mohamed “Mo” Tarek El-Fatatry (Finnish citizen) and Nahed Bedir Eletribi (Egyptian citizen) in 2019, ERTH was born out of a desire to make a meaningful impact, particularly in waste reduction, with a focus on e-waste.

What drew the co-founders to Malaysia was the region’s pressing environmental challenge. According to the United Nations University, Southeast Asia faces a staggering e-waste problem, generating a whopping 12.3 million metric tons of e-waste in 2021 alone. This situation has escalated from a concern to an urgent crisis.

Improper disposal and recycling of e-waste can lead to severe environmental consequences. When electronic devices are not recycled correctly, hazardous materials like lead, mercury, and cadmium can contaminate soil, water, and air, posing risks to ecosystems and human health.

Mohamed “Mo” Tarek remarked, “Finland has consistently ranked among the cleanest countries in the world and I am enthusiastic about applying Finnish best practices here in Malaysia to lead the way in e-waste recycling within Southeast Asia and ultimately work towards making Malaysia the cleanest country in this region. Our partnership with Gobi through the GDIV program is a perfect match, benefiting both our companies and contributing to the improvement of Malaysia’s environmental efforts.”

With this funding, ERTH has joined the ranks of startups supported by the Khazanah Nasional-backed Gobi Dana Impak Ventures Fund (GDIV Fund). GDIV Fund is part of Khazanah’s initiative to bolster the local startup ecosystem, operating within Dana Impak’s Future Malaysia Program. Dana Impak is a key pillar of Khazanah’s Advancing Malaysia strategy, with an MYR6 billion allocation over five years.

Within the next 12 months, ERTH’s goal is to open more branches across Malaysia, thus enabling more Heroes to contribute to environmental protection while gaining financial benefits.

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