This LA startup’s product was inspired by the vision of Jon Bricken back in the early 2000s, and in late June the company will be shipping to its first customers. OnSite Waste Technologies has completely pioneered the way in which medical waste is disposed of through its desktop-sized unit that converts regulated medical waste into sterile garbage. For the first time ever, medical practices will be able to dispose of their medical waste in the regular trash. OnSite Waste’s product saves practices a significant amount of money and time by eliminating the need to haul waste to a disposal site.
LA TechWatch chatted with founder Brad Barnes to learn more about how OnSite is changing the way medical offices manage the most important waste, the company’s future plans, and recent round of funding.
Who were your investors and how much did you raise?
Seed round of $3.5M. The round was led by Mark IV Capital in Newport Beach. Other investors include The Cove Fund and several family offices.
Tell us about your product or service that Onsite Waste offers.
OnSite Waste Technologies is pioneering a novel way for medical and long-term care facilities, along with other generators of medical waste to dispose of their hazardous medical waste conveniently in their location’s regular trash. The TE-5000, a simple-to-use desktop-sized unit, converts regulated medical waste into sterile garbage for small-scale medical waste producers. The TE-5000 reduces the liability associated with the traditional method of hauling waste to a central location by reducing or eliminating the time waste sits in a practice. For practices paying too much for their current hauling service, the TE-5000 can also have a significant impact on the bottom line.
What inspired the start of OnSite Waste?
The initial product was created in the early 2000s and was never really commercialized. I met the inventor Jon Bricken and built a company around his vision. The medical waste processing industry has not been innovated and we’re the company to do so.
How is OnSite Waste different?
Our solution processes waste right at the customer’s site. All other solutions are serviced by trucks driving down the road to pick up waste at a doctors facility. Today, a facility has to store waste until it’s generated and they’re on the liability chain until it’s destroyed several months later.
What market is OnSite Waste targeting and how big is it?
We’re focused on the small quantity generator of waste, not the large facilities like hospitals. There are over 2 million small facilities that generate waste in the US alone. We focus on medical practices, long-term care, retail pharmacies, etc.
What’s your business model?
We have a recurring business model. We rent the unit on 3 and 5-year contracts. We also sell the disposable collection containers.
Will the machines need to be replaced after a certain amount of disposals/time?
If so, how can the machines be properly disposed of so they do not contribute to e-waste?
Great question, our machines don’t need to be replaced and there’s very little maintenance. We project a 10-year life span. As customer churn and return the unit, we will refurbish and return to our customers. We are also considering donating units to needle exchange facilities and rehab centers.
What was the funding process like?
Great experience working with Mark IV and Cove Fund. We had expected to take $2.5 million but were oversubscribed and ended up taking an additional $1 million.
What are the biggest challenges that you faced while raising capital?
Pre-prototype and pre-revenue are always a challenge when raising capital. Mark IV put in the first $1M allowing us to complete porotypes. Once we had the prototype complete, the others came along much easier.
What factors about your business led your investors to write the check?
Strong management team, recurring revenue model, large market, potential market disruptor
What are the milestones you plan to achieve in the next six months?
- Shipping first customers in late June
- Test national account sales model and refine product-market fit
- Build a call center for outbound sales efforts
What advice can you offer companies in Los Angeles that do not have a fresh injection of capital in the bank?
I wake up every morning and find ways to not spend money, I suggest they do the same.
I wake up every morning and find ways to not spend money, I suggest they do the same.
Where do you see the company going now over the near term?
- We will put 1,000 units in the market over the next 12 months
- Structure debt to fund the machine cost
- Look to a Series A in early 2020
What is your favorite restaurant in LA?
I love Mexican food and in constant search of the best, the city has to offer. Being from Laguna Beach, I’m a fan of our local favorite Javier’s. In LA it would be Broken Spanish or El Carmen.
