To use a kiosk, a consumer plugs in their phone - using the cable provided - and the ecoATM scans the phone's contents and uses a camera that inspects the LCD screen for scratches and checks the phone for missing keys, to determine if it has any monetary value on the secondary market. The kiosk also will erase all data on the phone. The company works with a network of buyers, about 50 worldwide, said Bowles, that resells the phones on the secondary market, mostly offshore, but also domestically.
During trials at a Furniture Mart in Nebraska, consumers on average were paid $11 for each phone. At a similar trial in San Diego, the average payment for cell phones dropped off at the kiosk was $20. Bowles did not disclose what service fee his ecoATM charges at the point of transaction.
Bowles said the trials convinced him and his partners their idea would take off. A few weeks into the Nebraska trial, Bowles said a perpetual line was streaming out from the kiosk as some folks, carrying shopping bags full of old cell phones, waited up to 45 minutes to get their turn at the machine.
"It's hard to predict how consumers will react to kiosks," Bowles said. "But we're not asking for consumers to pay us. We're paying them for the used phones, like a Coinstar machine, which is why we think this automated approach will work."
Apparently, investors are also convinced.
Last week ecoATM, which launched last year, announced it raised an undisclosed amount of start-up capital from Tao Venture Partners and individual investor Jens Molbak, who has joined the company's board.
In 1989, Molbak founded Coinstar Inc., which, through 60,000 current locations worldwide, has helped people convert their jars of loose pennies and other change into currency, donations or gift cards.
Bowles said the funding from Tao and Molbak is part of a Series A round that remains open and which the company hopes to close within the next couple months.
Tom Clancy, managing director of Tao and a former program manager for ATM and kiosk development for Citibank, said the initial market tests convinced him that ecoATM's approach will enable an increase in recycling.
News Source :- http://www.reuters.com