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Hyderabad-headquartered business-to-business (B2B) platform for waste management and recycling marketplace, Recykal, has announced raising $22 million from Morgan Stanley India. Returning investors Circulate Capital, Vellayan Subbiah, and Arun Venkatachalam of the Murugappa Family also participated in the round, said the company in a statement.

This takes the total equity capital raised by the company to $26 million, including a $4 million round in 2020. 

The company will utilise the capital to strengthen its technology and expand its B2B marketplace, apart from building hyperlocal waste processing infrastructure. 

Recykal was founded in 2016 by serial entrepreneur Abhay Deshpande, who previously set up ecommerce platform Malamall in 1998 and ecommerce enablement SaaS platform Martjack in 2007. Martjack was later acquired by Capillary Technologies. Other co-founders in the company include Anirudha Jalan, Abhishek Deshpande, as well as Ekta Narain and Vikram Prabhakar.

The platform started out with a consumer-facing app for recycling domestic waste called Uzed.

“Soon we realised that it wasn’t cost-effective. With the implementation of Extended Producer Responsibility (EPR) to electronic waste and plastic waste, we decided to focus on businesses to provide traceable waste management solutions around 2019,” Abhay Deshpande told Yourstory. 

The company has seen a 3-3.5X growth consistently over the years. “Waste management is a pandemic and recession-proof business,” says Abhay.  

Through its marketplace platform, Recykal brings together sellers of recyclable waste which include hotels, offices, campuses, industries, Resident Welfare Associations (RWA) and the informal aggregators who collect recyclable waste from ragpickers and others. On the buyer side, Recykal works with recyclers of e-waste and plastics, who can now source the bulk of their raw materials from fewer suppliers instead of a long chain of aggregators and others. 

Recykal is also looking to add new categories of recyclers on the buy-side including metal, battery and other components. 

The company works with service providers in other geographies to source recyclable waste, formalising the industry through GST-registered transactions. 

“Waste management in India and many other parts of the world is already a big problem and it is getting worse. We believe our investment will allow Recykal to play a leadership role in implementing scalable and sustainable solutions to one of society’s biggest challenges”, said Raja Parthasarathy, Managing Director and Co-Head of Morgan Stanley India Infrastructure in the statement.

The company is on track to clock Rs 220 crore in revenue for the financial year 2021-22, said Founder and CEO of the company, Abhay. He added that the company had processed 200,000 tonnes of dry waste through its platform and connected over 100 brands, 1,000 corporates and 150 recyclers through the platform.