Smart Metals Recycling

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At the end of their sophomore year of college, Duke students Shelly Li and Arun Karottu made an observation that would change the course of their lives. As the semester came to a close, they noticed their friends throwing away end-of-life electronics in the dumpster. Among piles of empty ramen noodle containers and stacks of discarded class notes laid cell phones, laptops, cameras, and speakers that, too, were destined for the landfill.

This moment was just a glimpse for Li and Karottu into the larger problem of electronic waste recycling in the United States. Out of the roughly 384 million electronic devices disposed nationwide in 2014, only 19% were recycled.

Environmentalists at heart, Li and Karottu were determined to intervene.

Over the past couple of years, the pair have gone from being friends to co-founders of a multi-million dollar company, Smart Metals Recycling. By collecting reusable metals and plastics from undesired electronics and sourcing them back to producers, Li and Karottu are becoming important figures in e-waste recycling, a global industry set to cross $40 billion by the end of 2019.

They've been recognized nationally for their efforts too. Business Insider named them among "18 Incredibly Impressive Students at Duke" last spring, and they received the Borchardt Prize for best undergraduate startup at Duke for 2015.

Their Individual Journeys

Before arriving at Duke University, Karottu, a computer science major, was drawn to the idea of entrepreneurship. He wrote his college application essay on a green venture idea, and joined the campus’s entrepreneurial living community, The Cube, his freshman year. As one of the few students from his high school in Kerala, India to go to college abroad, dreaming big had always been a part of Karottu’s lifestyle.

Li, from Omaha, Nebraska, was a published science-fiction author pursuing an economics/philosophy double-major. Through her time at Duke, she has moved in and out of summer stints to find a venture that inspired her—the Obama for America campaign, an investment banking internship at Morgan Stanley, as well as a summer business analyst position with McKinsey & Co. However, nothing excited her more than the near-future possibilities she once wrote about in her short stories.

The two met through the University Scholars Program, a scholarship that awards full academic tuition to promising students pursuing interdisciplinary study.

Despite differing academic interests, Li and Karottu both shared a desire to become change agents in the world. When their moment of inspiration hit in their second year, they came together, each with their own distinct set of skills, to create something of value.


The Smart Metals Journey

In the initial stages of the endeavor, the pair reached out to large recyclers all over North Carolina, asking if they were looking for responsible and financially viable ways to dispose of end-of-life electronics.

After conducting research on the local recycling industry and securing the interest of enough companies looking to get rid of their waste, Li and Karottu became confident that Smart Metals would be a necessary and feasible business. With the help of several Duke resources, including Melissa & Doug Entrepreneurs and DUhatch, Li and Karottu developed solutions to promote responsible recycling.

Originally, they purchased recyclable materials from those early clients in North Carolina and brokered to end consumers domestically or overseas—to anyone who would provide more back-end value.

In March 2014, however, the company had the chance to change directions. Li and Karottu were surprised to receive an investment offer from L. Gordon Iron & Metal Company —a 98-year-old family-owned metal recycler based in NC. The two co-founders saw the potential partnership as a way to disrupt a very mature industry, typically resistant to change. The partnership also gave them access to massive warehouses outside of Charlotte, infrastructure-heavy equipment for processing e-waste themselves, a fleet to solve any logistical challenges, and an array of new clients. 

After recognizing that Smart Metals was about to take a rapid turn towards growth, Li decided to take a temporary leave from Duke to work full-time as CEO. Karottu graduated this past spring and serves as the Vice President of Sales.

Smart Metals Warehouse
The Smart Metals warehouse in Statesville, NC. Photo courtesy of Shelly Li.

Now, Smart Metals handles over 100,000 pounds of scrap metal per day and earns $9 million in annual revenue. Li and Karottu have hired 28 employees to join them full-time in the business (most of whom are based in Charlotte). They continue to expand their services in North Carolina and are exploring the possibility of a second location on the West Coast. 

But an end goal, according to the team, is not just to recycle electronic material, but to help corporations design new products or services such that they leave no trace on the environment at the end of their lives. Stay tuned for more details on those plans.

"Believe me, it is a very rare thing to drive home from the office with just highway lamp lights guiding the way, exhausted from the day's battles and stressed about plotting for the day after... and not ever, for even one second, consider any life different than this one," says Li.