EME: A Dating Site for Materials
Maayke Aimée Damen is a Dutch circular economy champion who has developed the idea behind the Resources Passport—which now has been made into Dutch and European policy—and is co-founder of the Excess Materials Exchange (EME). EME is a digital facilitated marketplace for secondary materials. It functions like a dating site where supply and demand are matched and materials are matched with their highest value re-use potential. Together with EME’s team, Maayke pushes companies, governments and individuals to radically reconsider what we currently define as waste and to think about how to create economic, societal and environmental wealth out of it.
Hi Maayke, what a pleasure to meet you in Utrecht for a talk and a…fresh lemonade, open-air. Yes, a fresh lemonade, in February, in the Netherlands; not exactly good news, I presume. As a way of starting our conversation, could you provide us with a snapshot of your path as a female innovator towards a circular economy, so far?
Ever since I was very little, I have always been passionate about the environment and how we interact with it. When I was a kid, I didn’t know what to do about it and I started the search on what I could contribute. The narrative at the time was that if you really want to contribute to a better and greener planet, you should work for a NGO. So, when I was 16 years old, I started working at a NGO, which was a great experience but also showed me that, to a large extent, these organizations were very influenced by policy. At that point in time, the subsidy requirements were changed, and a lot of organizations missed out on that, even though they were doing amazing work. This had big consequences and made me think that if I really wanted to change things systematically I had to go into politics. So, I was fortunate to become part of the Dutch youth delegation to the United Nations and had the possibility to go to conferences about climate change, energy and sustainability. I learned a lot, and also that things need to have a business case. Governments can contribute a lot, but are not known for their speed.
One of the possible, and quite effective, ways governments can take action is via taxes. So, I started working on Ex’Tax—an idea from Dutch entrepreneur Eckart Wintzen—and together with Femke Groothuis we did the first research on how the Dutch government could shift 31 billion in taxes from labour to resources, and how to do it budget neutrally. For that, I had to investigate which resources we were going to tax, if we had to make the shift. I thought there would be a list saying which resources were going through society, but that list didn’t exist. So, I developed a system that could systematically generate that list, and called it the Resources Passport, which basically gives resources an identity, enabling companies to track and trace them, evaluate them and find a high-value new destination for them. This was in 2010-2012. Then, I graduated Cum Laude from Utrecht University and won some awards for it, amongst others for Singularity University, the university by Google and NASA in Silicon Valley, where I learned about exponential technologies and how you can leverage those to make a positive impact in the world.
That triggered my thinking to create a business case for a resources passport, because if it is just about filling in a lot of data in random fields and then having no direct return on investment, companies are not going to do that, unless it is mandatory. So, then I came back to the Netherlands and I met my co-founder, Christian van Maaren, and with him I created the idea of Excess Materials Exchange.
How does the Excess Materials Exchange (EME) work? And, which goals does it have?
The reason why we started EME is because waste is really a problem. There are many statistics showing this is the case. The world wide waste mountain is expected to grow by 70% by 2050, and right now 95% of materials’ value gets lost after single use, like a paper cup you drink coffee from, which you use for 5 minutes and then it’s gone, which is literally a waste because it could still have a lot of value. We wanted to work on showing that waste is actually valuable and we can turn it into wealth.
We like to describe the EME as a dating site for materials. We match supply and demand of materials, and most importantly materials with their highest re-use value opportunity. We match suppliers, buyers and value added providers that can help make the materials ready for the market again. Like legal companies, tech providers or financial institutions. In the case of a specific material like coffee leftovers, for example, this means not burning them—because then you have a crematorium for materials—but rather making ink, paper, fibres, bio-plastic, or water filters out of it. And after making ink out of it you could still grow mushrooms on it. All these examples are of higher value than just burning it.
We want to automate and facilitate the whole process, because things change, and if you have to rely on chance, instead of design—which is the case right now—then these exchanges can and do take place but the lead time is sometimes 13 years, which is really long. We want this exchange to take place on a large scale, fast and with a business case behind it.
Which scale are you currently working at; Dutch or international?
The way we set it up is that it can be rolled out internationally, because when you can do this internationally, it has a bigger impact. We want to be able to scale. We started in the Netherlands because both of us are Dutch and we have connections here, and we see that the Netherlands has strong ambitions on the circular economy. So, it’s a good starting point. But supply chains are global by definition, so we really quickly go across borders; there is not a real demarcation. We are already working with international companies, like Sodexo, which is French. What we focus on is the highest re-use value for materials, and there needs to be a business case behind it. Sometimes that’s locally in the Netherlands—because of transportation issues—but sometimes it is not at all.
Let’s compare two scenarios: before EME and after EME. How is EME a game-changer in the way companies conceive and deal with their waste and the waste of other companies?
Before the EME, maybe people meet each other at a conference and they start talking about waste and the circular economy, and they realize ‘oh, we have that waste stream’ - ‘oh, interesting’, and then the process gets going, but it is just for those two companies. To deal with waste is not the core business of production companies. Now they have a budget for it, want to get rid of it, and are happy when it is taken care of by waste processers. With EME, we make it more transparent where the waste is located, what the composition is, quality and quantity. Then we facilitate the transactions, which we are going to automate and make it self-learning, so that the system can already suggest you ‘hey, you have coffee leftovers, there is this company in your neighbourhood that is looking for that and is willing to pay X’ or ‘have you already thought to make ink out of it? There is a company out there that is looking for that’.
That’s definitely a game change for an ink company too…
Yes, from a situation in which the ink company has to go to separate restaurant owners to ask if they could have their coffee leftovers, to one in which we just need to make sure that the restaurant can put it on and it’s basically taken care of from there. That’s where we are going and, eventually, from there you can really go to an ‘exchange’. Let’s say you have put a building on EME. Eventually you can take an option on the materials that will be released once the building will be deconstructed in, let’s say, three years from now. You can generate a lot of additional value from taking a perspective like this.
Which inspiring collaborations are we seeing right now? That is, which industries are better collaborating with each other?
We see that some sectors are really frontrunners in circular economy: building and construction, plastics and packaging materials, textiles, and organic waste. They are really keen on becoming more circular for different reasons. In building and construction, so much stuff is being thrown away and there is a lot of money to be made there. And for example in packaging, consumers are on top of that. Plastic is positioned as ‘the devil’ right now, which is an interesting trend to tap into.
We have conducted a pilot focusing on any type of material, specifically because we believe that we need cross-sectorial and cross-industry exchanges, because that’s where the highest value matches can be found. In this pilot with 10 big corporates, like DSM, Sodexo, Schiphol, Rijkswaterstaat and Prorail, we identified their material streams, we analysed them and found high value new destinations for them. Those were all different types of material streams, but we saw that these 4 sectors were eventually the furthest and, because of that, it is easier to start with these sectors.
And what about the sectors that you see still lagging behind?
The majority of the sectors are becoming aware of this, especially in Europe, where we import a lot of materials from economies that might, all of sudden, have political and economic issues, creating problems in supply chain security and price volatility. This makes people aware of circular economy, and I think that the majority of CEOs is now aware of circular economy and working towards it. I don’t think there is a sector in which nothing is happening. All the sectors are different and regulation can either be enabling or disabling. What we have seen from the pilot project is that there are a lot of possibilities once you dive into it and have the ambition to exchange used materials.
Which challenges have you been encountering on the way of making ‘waste’—or, to better phrase it, excess materials—exchanges happen in an easy and advantageous way for companies?
We see quite a lot of obstacles, for the reason that society and the economy right now are designed to be linear, and not circular. In order to switch that, one tool—such as a marketplace—is not going to solve everything magically. We have recognized this and embedded the tools that we have in the legal framework. So, we have partnered with a big law firm, Stibbe, with a bank, ABN AMRO, and an accounting firm, EY. With completely different business models, such as product-as-a-service, new questions come up: whose balance sheet should it be recorded in? Who can you credit the carbon emissions to? How are you going to finance a circular project when the return on investment might take some time? We are investigating all these things with big corporates to help make this change for every sector, not just for one.
One of the biggest obstacles is transparency, because especially for big companies to say what they are throwing away can be a branding issue. Moreover, waste information and what exactly is in your product is very often competitive information, so companies do not want to put that online. But, if you don’t have that transparency, then you also don’t know what to do with it, because we often see that waste in one sector remains waste in that sector. Think again about coffee leftovers, for instance. So, we needed to overcome this gap between the need for privacy of sensitive information and transparency, because disclosure is essential to make sure that you know where materials are, in which quantity and of which quality. Only in this way they can be re-used on a large scale. To overcome this barrier we use a specific Blockchain protocol.
This privacy-transparency gap or paradox appears to be crucial…
Let me point to three other important obstacles. One is a timing issue. The moment you want to get rid of your waste is not necessarily the moment that the other person wants to use it. Then, there is a quality issue. Sometimes recycled textiles rip quicker, so that for example they don’t pass a stretch test. Quantity is another issue. To stay in the coffee example, if I have an ink production company, I need to have a certain amount of input of coffee leftovers to make sure that my production process is not disrupted. These are issues that now companies need to overcome. With a marketplace like the EME we can overcome these issues and create so-called economies of supply and demand.
What about obstacles in the institutional environment?
Regarding the institutional environment, we need to pay attention to the way we define ‘waste’. Right now, it is really focused on preventing negative environmental impact, which is great given the disasters that have happened in the past. But when you want to go to a circular economy, this is hampering, because waste for one sector doesn’t mean waste for another one. It is hard to get to end a waste status right now and time-consuming to go through the whole process. Institutionally, it is very slow and if a company has to store these materials and go trough the legal process, it brings a lot of costs to it, making it only attainable for vey big companies to start looking into these things. For SMEs, it is too much of an effort to go through that if it is not your priority or branding image.
There are endless questions and issues, as transition times are always chaotic, when people try different things and see how it goes. At EME, we have a vision but we don’t know all the steps yet. We know the first few, we try to be flexible, test different things and see what works best, taking everybody along in the learning journey. Also these big institutions and banks, in fact, benefit from knowing about this and how they are going to adjust their own strategies in times of exponential change. A start-up is quite flexible and agile and can test assumptions fast.
Yes, indeed, in times of transitions the experimental route is the only viable one. One experiment you have started during your entrepreneurial path is the Resources Passport. What is it? And what’s the aim of this identification?
With the passport, you can give resources an identity. Very often things get thrown away because they are anonymous. Think about carpets. There are carpet manufactures, like Interface and Tarkett, who produce high-quality carpets, but when they are in a building with 7 floors and the building gets refurbished, the recyclers just throw the carpets—both the good quality and the bad ones—in one pile, and the whole batch is lost. This is simply because the carpet is anonymous. By giving it a resource passport—and we are testing to chip the carpet itself—recyclers will be able to see that this is a carpet from, e.g., Interface and send it back. In this way, we separated it from this pile with which we can’t do anything anymore, because we don’t know its quality and origin.
The passport gives things an identity and this is relevant for various people on the way. As a designer, by knowing what is in your product and how you put components together—e.g. glued together vs. screwed together—you can change the end-of-life value of a product. As a consumer, you can start differentiating whether you want a product with for example a specific level of carbon emissions or toxins, or not. And, as a recycler, it is a lot easier to make a business case, because you know which product you get, what’s in the product, hence it is easier to make a business case. Plus you can make data-driven decisions.
Can you compare all sorts of products based on the resources passport?
That’s a fundamental point. We have designed the passport in such a way that it is context-independent and, therefore, inter-operational. This means that we structure the data in such a way that we can compare the data from a coat, to your laptop to a building, which is useful because you want materials to be in endless loops, not just in one closed loop. There is a continuous spiral of possibilities that a (technical) material can go through, but for that they need to be comparable with each other. We go quite into depth and analyse it at a product level, a component level and a material level. Very often the highest value re-use is when you use a product for a function it was designed for. If that’s not possible, you go one level lower, so we distinguish like that.
How does the Resources Passport connect with the platform of Excess Materials Exchange?
The way we work is that we have 4 separate modules in the EME. The first one is the resources passport, which we help companies fill out, as it is new for them. The second one is tracking and tracing, because you need to know where the material is, in order to make sure that you get it back, it’s not anonymous, and you can find the highest value re-use opportunity. Then we have a valuation methodology, where we calculate possible end of life values and the environmental and societal impact that you have if you use it for something else. And, finally, we find a match, among the different options. With coffee leftovers, for example, some options are ink, bio-plastic or mushrooms. Sometimes we see that you can cascade it and have ‘and, and, and’.
Let me conclude this conversation by focusing on the circular economy as a systemic socio-economic transition. What do we want out of it? And, what is needed in order to make this a successful transition?
This is a tough question, because there are so many angles to it and thus I will definitely leave some aspects out. What we want is an economy that is regenerative and restorative, and we want to do that by design. We want materials to be continuously in the loop and create wealth because of that; not only financial wealth, but also human and environmental wealth. In order to do that, a lot of things need to change. From our experience we see that one tool is not going to solve the problem, even though people tend to like quick fixes. This is a very complex story and we need to make it tangible for people, making it clear how to go through these steps. There is a lot of research about why is it so difficult for people to do something about climate change: it is intangible, we don’t immediately see cause and effect, which might be in the future. This makes it hard to feel any ownership over that problem. What we are trying to do in this story is to make tangible for people what they can do in any position they are in, whether in a law firm, in a production company, as a recycler or as a consumer. We try to give everyone clarity about their role, and how they can take responsibility in that role.
We need to create a story that people can actually relate to, instead of some abstract concept. It’s all very complex and interrelated. When you change one thing, it will have an effect on many other things; it is not just one-on-one relationship you are talking about. This is called systems’ thinking. When you think in systems, everything is connected, while in our society and in companies we very much work in isolation: this is my supply chain, this is my department, this is my responsibility. For people it is not natural to think in systems, as it is not to think exponentially. We think linear. But systems’ thinking and exponential thinking are essential to get a grip of this transition that we are in.
You just pointed to systems’ thinking and exponential thinking as two fundamental mental tools to make this transition a successful one. But, as you recognized, difficult for people to operate in. Do you have an example able to bring exponential thinking closer to people’s minds?
Think about the Amsterdam Arena or any other stadium that people are fond of. You stand in the centre of the stadium, which is, for the sake of this thought exercise, waterproof. Every minute a drop of water falls, but it also doubles every minute. So, the first minute is 1 drop of water, the second minute is 2 drops, the third minute is 4 drops, etc.; it grows exponentially. How long does it take before the stadium is underwater? The majority of people say one day, two days or something like that, while the answer is…46 minutes. By minute 30 the water is at your ankles, and you are not really paying attention to it; 15 minutes later the stadium is completely covered in water. Things go really fast. This is why it is important that we do not wait 5 years from now. We need to start practicing and acting today.
Thank you Maayke, that’s a brilliant example! I wish you and EME all the best in your matching efforts for materials’ dates. Not necessarily ‘romantic’ matches, but certainly the best ones for our economy, society and environment. And, ultimately, working for the health and wealth of people and nature is always a romantic endeavour!
March 2019
