Closed Loop Partners has made more than 80 investments over the past 10 years of existence and is poised to keep going. | Chones/Shutterstock
Closed Loop Partners has provided funding to more than 80 companies and municipalities over its decade in existence, a period of significant turbulence in the U.S. recycling sector.
The investment organization this month published a report outlining its activity and impact over the past 10 years. Closed Loop Partners launched in 2014 with its inaugural investment vehicle, the Closed Loop Fund. Funded by some of the largest consumer goods and retail companies in the country, the fund vowed to invest an unprecedented $100 million into the recycling industry.
The organization kicked off its first round of funding in 2015, providing capital to a joint-venture plastic recovery facility, or PRF, operated by QRS and Canusa Hershman in Boston, and to two municipalities switching from dual- to single-stream recycling systems.
Since then, the organization has grown dramatically to include a variety of types of financing activities, adding a venture capital arm in 2016 and private equity acquisitions in 2019. It also began funding research in 2018 through its Center for the Circular Economy. Most recently, in 2022, Closed Loop Partners added an operations arm, called Circular Services, which is directly engaged in facility operations, including materials recovery facilities.
The organization has made more than 80 investments over the past 10 years, a period that brought what Closed Loop Partners described as “the most volatile commodity prices in a century, underscoring the need for more efficient materials management.” It also brought major industry disruptors, including China’s import bans and the COVID-19 pandemic.
The investments include 39 companies that received early-stage capital through the Closed Loop Ventures Group, with $85 million in assets under management; six acquisition investments through the Closed Loop Leadership Group totaling $200 million in assets under management; and 48 projects invested in through the Closed Loop Infrastructure Group, with more than $225 million in assets under management.
Plastics infrastructure investments
The Infrastructure Group is particularly focused on infrastructure such as MRFs, municipal programs, processors and end users of recycled material. Within this investment portfolio, 42% of projects are in the sortation space, 21% are in collection, 19% are in processing, 16% are in manufacturing and 2% are in technology.
Closed Loop’s plastics processing and end-use infrastructure investments include sortation upgrades at the City of Phoenix’s North Gateway MRF; PET reclaimer Evergreen; chemical recycling firm Greenmantra; recycled plastic railroad tie manufacturer IntegriCo; Minnesota film processor Myplas USA; recycled plastic end user Preserve; plastics recovery facility QRS of Maryland; and chemical recycling firm Reterra.
Closed Loop estimates its infrastructure segment has led to diversion of 402,000 tons of PET; 97,000 tons of HDPE; 61,000 tons of PP; and 13,800 tons of LDPE and LLDPE.
Across all its segments, Closed Loop Partners estimates its investments have diverted 6 million tons of material that would have been disposed of.
Because the organization invests in a range of novel recycling processes, not all of the firms it has invested in have succeeded – indeed, its initial investment, the Baltimore PRF, was idled in 2017 after experiencing challenges, and it ultimately closed completely. And more recently, film processor Myplas USA shut down shortly after opening.