A Canton firm that helps businesses determine what to do with old or damaged smartphones and other electronic devices has raised one of the largest funding rounds in Baltimore so far this year.
Apkudo announced Wednesday it had raised a $37.5 million series C round. That round comes a little less than a year after the 100-person company raised $14.4 million, one of the largest VC deals in Greater Baltimore in 2022.
The company's oversubscribed round was co-led by Closed Loop Partners' Leadership Fund and Piper Sandler Merchant Banking with the participation of MissionOG, Harbert Growth, Grotech Ventures, Lavrock Ventures, and Point Field Partners. Apkudo plans to use the money to expand its international presence. President Chad Gottesman is planning to build offices in the United Kingdom and the Netherlands to work with international companies, as well as the foreign offices of Apkudo's existing customers. The company has already begun working with one Dutch online retailer of second-hand electronics, Remarketed.
Gottesman is also going to build Apkudo's marketing team so the company relies less on customer referrals for growth.
Apkudo focuses on working with mobile phone carriers, device manufacturers and others to evaluate the condition of a device and manage a company's overall device inventory. After Apkudo determines if a device works, the company can decide whether it’s best to repair, sell or recycle the device. Apkudo evaluated 14 million devices in 2022, up from eight million in 2021.
"None of it ends up in the landfill," Gottesman said. "We're trying to eliminate any new e-waste."
One of the things that make Apkudo different than simply taking a laptop to an IT professional is the scale it provides to business clients. The startup offers a robotics line that can assess the devices based on functionality and cosmetics. The company’s robots can process 300 devices an hour.
The company has several high-profile clients like FedEx, AT&T, Verizon, T-Mobile and Amazon. Apkudo has also expanded into the computer industry since its founding in 2011 by building a new trade-in program for Dell in 2021. The trade-in program integrates Dell’s internal documents to see information about a device a customer wants to trade in, rather than just relying on the customer for information. Electronics insurance company Asurion began working with Apkudo in 2022 to evaluate the condition of devices for insurance claims.
There is a growing market for Apkudo’s ability to determine if a device can be refurbished or recycled. Cellphones have become a ubiquitous part of modern life, with 97% of Americans owning mobile phones. However, less than 20% of electronics are recycled, according to the United Nations, creating a massive amount of waste and increasing the need to mine for rare metals. Apkudo hopes to help build a more circular economy, where already existing materials are refurbished and reused as much as possible. One of Apkudo's customers, Dell, wants half of its products to be made out of recycled materials by 2030.
“There is so much value within the connected devices already in the market today. Increasing their useful life and keeping these valuable materials in circulation, and out of landfills and the environment, is a critical part of accelerating the circular economy," said Martin Aares, head of asset management at Closed Loop Partners, in a statement. "Apkudo is helping build a circular future for connected devices –– one that is more transparent and agile.”
Gottesman believes the next step for Apukdo is to go public through an initial public offering or get sold to a different company. Although the current financial market has been difficult for many startups to gain funding, he believes the physical components of Apkudo's business, like the robotics line, makes it easier for investors and customers to connect with the business.
"The Apkudo platform is absolutely a full enterprise-grade, operationally dependent software that we are providing to our customers," Gottesman said. "But having that physical robotic component to it really bring brings it all to life."
