Social Challenge and Innovative Solution
Nowadays, only 20% of electronic waste is collected and recycled. Every year, 14 million new IT devices are being sold in Germany alone, with the turnover rates of hardware always increasing. Just a fraction of the disposed hardware is being refurbished or recycled.
The social enterprise AfB Social and Green IT not only tackles this environmental issue, but also helps people with severe disabilities offering them job opportunities in their factories, shops and offices. Today almost half of AfB’s employees have disabilities. Together with their colleagues, they collect decommissioned IT hardware from companies and organisations, and professionally delete all remaining data. They then refurbish the devices for re-use. This not only reduces electronic waste, but also saves valuable raw materials (such as rare-earth and noble metals), and reduces greenhouse gas (GHG) emissions associated with the production of new material.
AfB sells the refurbished devices online or in one of their 10 retail shops, giving them a “second life” by reintroducing them into the market with up to three years warranty. Old or defective devices are disassembled and recycled under highest ecological and ethical standards, resulting in the production of new resources in Europe. The original owner of the devices receives all relevant reports including data destruction certificates for delivered hardware. All work steps are designed barrier-free and employees with and without disabilities work together side by side.
Key Social Impact Figures
In total, AfB created 370 jobs, of which almost half are held by people with disabilities. Many employees are in an unfavourable state when starting their work at AfB. Over time, many succeed in re-gaining confidence and developing their skills, and then proceed to take on higher qualified jobs. Each employee is treated individually and according to his/her strengths and abilities. There is a representative for people with disabilities as well as a company social worker who supports the staff’s development – including trainers/supervisors.
Investing for impact
How it Started and Support Provided
After three years of activities, AfB started expanding in Germany, opening new branches in new city such as Stuttgart, Cologne and Hannover; and between 2011 and 2013, new branches opened in Austria, Switzerland and France. Given their emphasis on helping people with disabilities, they were looking specifically for social investors to support their rapid scale up. And that’s when BonVenture came in.
Following their due diligence process, in 2013, BonVenture provided a high six-digit loan to be repaid with a usual market interest by 2020. The social impact fund also bought an equity share of the holding of AfB, “i500 gAG” – a non-profit stick company.
As AfB was already an established business, the non-financial support provided by BonVenture was not as intensive as it might have been for a start-up. Paul Cvilak, the founder of AfB, already had a lot of experience in entrepreneurship, as he had previously run a successful for-profit IT company. BonVenture focused its organisational support on impact management and measurement.
|Results in 2018
· Increased proportion of refurbished IT hardware
· Reduce proportion of electronic waste
|# (and tons) of IT devices processed per year
|360,000+ devices (2,500 tons)
|Reduce GHG emissions
|tons of CO2 emission avoided
|Decreased unemployment of people with disabilities
|% employees with disabilities
As it was the first time they were reporting to a social investor, AfB’s managing team learnt how to measure their social impact more efficiently and report it to BonVenture. They already had some KPIs for their CSR partners, but refined their impact measurement system. AfB sends a financial report to BonVenture on a monthly basis, including an update on these social impact results.
What they think
Today AfB has sites and shops across Germany, but also in Switzerland, Austria and France. The business model can easily be adapted to any country in Europe. The main challenge is to first find local partners as it is an essential step to start the process. They need to secure companies that will provide the decommissioned IT hardware to recycle (e.g. banks, insurance companies, and industrial companies). This allows them to ensure they will have the necessary amount of IT material, then they open a site with a shop where they refurbish the material and remarket it.
AfB is already self-sustainable and is already in negotiation with other social investors to replicate the model in other European countries. This has already started as in January 2019, AfB Slovakia was founded. In the future, other countries could potentially include Belgium, the Netherlands, Luxembourg or Italy.