The conversation around electronic waste is finally maturing into opportunity in the circular economy. It was framed for a long time as a cascading environmental disaster, something that was all too easy to feel as “out of sight, out of mind”.
Like with all change, it mostly comes from the ground up; markets, demand, culture, and chasing value. In a cost-of-living crisis where the latest phones cost as much as a 2003 hatchback, companies are beginning to see the wasted potential in this e-waste, and a growing demand for cheaper, repaired phones. This shift is laying the foundation for a true circular economy, where products are reused, refurbished, and recycled instead of discarded.
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Conspicuous Consumption and Conscious Value
The engine of consumer technology has for years been in the upgrade cycle, a model that was a balance between offering something marginally better (and shinier), along with the credit and payment plans so you won’t feel the brunt of it. Of course, it’s not just a waste of money in most instances, seeing as the next model up has been decreasingly impressive as time has gone on (as if we’re plateauing, somewhat), but it’s also a false economy because this pay-monthly model comes at a secret cost that all debts do.
The shift has come from a few things, one of which is that even the most mid-tier smartphones now seem to do the job, and a $400 Chromebook can be lightning quick. But it’s also a culture of long-term thinking around finances (e.g., r/BuyItForLife on Reddit has 3 million subscribers now) and more care for the environment. The calls for upgradability, too, are getting louder.
It’s opened the door to “re-commerce”. This is secondary electronics market which has gone from informal, low-trust marketplaces into a sophisticated, mass-market industry. The key has been building consumer confidence through rigorous diagnostics and certified repairs, so people know they’re getting something reliable. But it’s also a way to spend less money in a circular economy on essentially the same product.
The thing about phones is that they’re easy to break. So, while the upgrade cycle certainly does flood the market of 2 and 3-year-old phones (which is good for the customer as it suppresses prices), but even the latest models, like the iPhone 16 refurbished, is readily available. Why? Because people think their phone is e-waste when it isn’t, and in fact simply needs a straight-swap screen replacement or something similar.
Building the Reverse Supply Chain in a Circular Economy
The complexity and opportunity in the circular economy lies in a field that barely existed a decade ago: reverse logistics. This is more than just handling returns, as it means having a high-value supply chain that operates in reverse. Unlike normal manufacturing, which is standardized and a repeat of the exact same workflow, things vary more when handling a product which you don’t know what’s wrong with – and then need to fix it.
It’s taken a while, but we’re finally at the stage where device collection, certified data sanitization, multi-point diagnostics, components are harvested (for future repairs), and many other seemingly varied processes are now optimized.
This industrialization of reverse logistics has attracted some serious investment, and venture capital is flowing quickly into this space – and even within B2B. In late 2024, Molg, a startup developing robotic microfactories for autonomously disassembling complex electronics like servers, raised $5.5 million from a consortium that included the Amazon Climate Pledge Fund. It shows that there’s now investor confidence in the scalability of automating the difficult, granular work of component recovery and remanufacturing.
Hurdles on the Path to a Trillion-Dollar Valuation
Legislative action is playing its part. The “Right to Repair” movement has gained a lot of traction with laws passed in states like California, New York and Oregon – not to mention the fine job that the EU has been doing.
Legislation forcing phone companies to have removable batteries and easily unscrewed covers, for example, only grows the refurbished phones market. In fact, it democratizes it, as it will be more possible for individuals to go out and buy replacements to keep their own handset for longer. For those that don’t want to go through this effort, the circular economy will become more ingrained in our culture, as we won’t view it as e-waste, but a bunch of perfectly working and highly valuable components. The right to repair would make it faster and easier for these refurbishing companies, which would reduce labor hours and thus bring down the cost of the resell price.
Closing the Loop of a Circular Economy for Profit
The circular economy for electronics has moved away from just talking about mounting e-waste and far-away landfills towards a more actionable and productive reality. By creating profitable markets for reselling items, more companies and investors are looking to get involved in this market – much like how the size of the second-hand car market is bigger than the new car market. Back Market is a great example of how this shift is taking shape, offering a thriving marketplace for refurbished electronics that proves sustainability, and profitability can go hand in hand. Legislation changes are looking promising, but when the economics alone have incentives, sometimes that’s all you need.
