Green Matters has teamed up with WeWork for the month of April to celebrate Earth Day 2018 with a #workgreen challenge and Q&A series spotlighting sustainability-minded WeWork member companies. In this installment, we’re sitting down with Robert Olivier, founder and CEO of GrubTubs. Olivier has spent the last 17 years developing insect-based technologies; and GrubTubs stands to be his pinnacle achievement.
Company name: GrubTubs
Location: Austin, TX (with plans to expand to Dallas or San Antonio next!)
What they do: GrubTubs turns food scraps from restaurants into affordable, sustainable animal feed for local farms. To accomplish this, the company employs the help of protein-rich insect larvae called grubs, which consume food waste and are then fed to chickens and pigs at a fraction of the cost of commercial animal feed.
Why GrubTubs is so valuable: Animal feed is the number-one expense in agriculture, and far from sustainable. Around 70 percent of the farm acreage in the US is used to grow grains for animal feed that could be used for other purposes. GrubTubs alleviates the need for grain-based feeds for chickens and pigs, while simultaneously keeping food waste out of landfills. Restaurants, farmers, consumers and the environment all benefit.
GREEN MATTERS: What part of GrubTub’s work are you most excited about?
The amount of food we can recover from restaurants.
Typically for a bigger restaurant, the food gets so stinky it has to go every day into a dumpster. But because of GrubTubs, there’s no odor or pests. So it can be picked up when it’s full, or once a week. That’s how we’re saving this restaurant on its landfill costs.
In the old system, companies had no incentive to recycle because a landfill company would say, "Hey, I have to be here every day or every other day anyway, and you have x cubic feet [in this dumpster], so just throw it in there."
If we can knock the frequency down, we have just dethroned the lord of trash. Food is the bottleneck keeping the landfill guys in business.
We charge by weight. We incentivize everyone to get as much weight out of the landfill as they can. A lot of people don’t realize how much food they have by weight… The point is that they start realizing that if all their food goes to GrubTubs, they don’t have to pay as much for landfill trash. Eventually, we increase our service as they decrease landfill service.
What was the piece of your backstory that inspired you to create this particular business model?
I understood the insect part a long time ago. But what I tell people is that in order to industrialize an insect, the insect doesn’t need us. If I walk in the forest, the honeybees are perfectly fine building a beehive in a tree. But people make beehives because man wants to interact with insects in such a way that it’s easy to get to the honey.
The trick wasn’t the insect. It was finding the right beehive to work with the humans.
I have a degree in environmental science and finance. If you want to change business, you must understand the ways of business. Why protest and chain yourself to trees if you can change agriculture, making it economically feasible to not cut down the trees?
Since I was 14, it was all about learning business, learning the environment, and connecting them.
If American farmers can be sustainable again in the broadest sense: If they can respect and feed their animals, have happier animals, and feed families, that’s sustainable too. And that has preoccupied me for a long time.
How long does it take for the grubs to hatch?
GrubTubs is different because there are lots of people who can grow insects in trays, which takes about two weeks.
What I figured out was a “continuous-flow reactor” - a way to put baby insects in every day, and take mature ones out so that the reactor doesn’t stop for about six months at a time. Instead of managing hundreds of trays, all you really need is a really big reactor.
Here’s the crazy thing about these grubs. These grubs are what chickens eat. If you put a chicken in a soy field, it eats grubs in the ground. When we use soy and corn (mostly GMO-produced in this country) to feed chickens, it’s made to look like a grub with that feed pellet. Nature designed grubs as grubs for a reason. Feed pellets imitate grubs. We realized, why create a pellet when we already have a grub?
The only problem with that method is grubs don’t have a shelf life. They don’t store. So we came up with the GrubTub as a way to store nutrients. They can be placed on a farm for two to three weeks as a nutrient battery. When a farmer is ready is ready to go put it in the process, that’s when the grubs come out.
The farmer just looks and says, “OK, I have so many chickens so I’m going to put more grubs in and more food waste in.”
We stockpile the food, not the feed, at the farm. Then it’s up to the farmer to make his own feed.
What has been one of the bigger challenges you’ve faced in setting up GrubTubs?
The underlying assumption of the business model was very appealing: You get paid to take it and you get paid to make it. But as we developed the technology, the simple idea became harder and harder because the margins shrank. We realized we would have to get a lot of capital to prove the concept and we were completely straddled with the notion of who could be the first investor in this thing that no one else was doing. In that sense, it was very difficult because we were getting venture capitalists saying “Yeah, come back to us when you have some funding.”
Then we won the [WeWork] Creator Awards. And the crazy innovator that I am, I committed to purchasing more than $80,000 worth of dishwashing equipment. That’s because we could not create good and safe feed without coming up with a way to sanitize the tubs. That was priority number one. Clean tubs were such an easy, obvious solution [to encouraging restaurants to use our product]. You realize you just spent this much money - but now you can wash 300 tubs an hour.
Was there an aha! moment when you realized this business idea was really going to work?
When I started giving hard plastic, recycled, clean GrubTubs to people, they started really using them.
I never knew food waste was up to 60 percent of restaurant waste. Putting these [GrubTubs] in their kitchens, we realized we were doing what composters were not: capturing 95 percent of food waste in these hard plastic containers.
Restaurants were then changing their purchase behavior because they could see what they were producing… The aha! moment for us came a month later when we realized they were sending nothing to landfill. It started with clean tubs, and ended with reducing landfill waste by 75 percent for these restaurants.
What has the feedback been like from your customers?
The testimonials are just phenomenal because we’re all about working with our clients. We listened to our customers. They wanted something [to hold compost] they could carry down steps, something durable, something that wouldn’t leak.
We had all the good intentions to do the right thing, and that meant sometimes making purchases normal compost operators would never do, like buying 6.5-gallon tubs that are easy to work with.
About three weeks ago, we signed up a new farmer who’s been farming for a few years in the Austin area. Because of GrubTubs, he has now committed to purchasing 5,000 more birds next year in anticipation of saving $1,000 per 1,000 birds. Because of the reduction in his feed costs, he suddenly has a livable income.
It’s going to take about five years [from GrubTubs’ launch] to get 20 to 40 farms in the Austin area. But we are still cash flow positive, because of the restaurants.
How has WeWork helped you to continue your mission and helped your company evolve?
We are a dual company. Obviously, WeWork has not created a WeFarm yet so we have a completely autonomous part of the company that is on a farm. But when we work with chefs, we have our marketing, our social media, and sales reps all in the heart of the city where the waste is and the restaurants are.
We’ve come up with a rollout strategy that requires us to sign up 100 restaurants and one farm to launch in a city. So we need an office space in each city so we can have easy access. We will have farms and office space - we will have farms and WeWork.