Homeboy Recycling (Isidore Electronics Recycling)
Isidore Electronics Recycling is a Los Angeles-based social enterprise that employs individuals facing severe obstacles to employment – often due to former incarceration – to recycle or refurbish electronic waste (e-waste). E-waste, which includes discarded computers, cell phones, batteries, and other electronics, accounts for over 70% of toxic materials in landfills. Since its inception in 2011, Isidore and its employees have saved over 2.2 million pounds of e-waste from conventional disposal.
In Fall of 2015, Isidore was approached by Homeboy Industries – the largest gang prevention organization in the US – about purchasing a majority stake in the business. Although Isidore’s model had proven successful, the acquisition was certain to provide the small enterprise needed capital, a greater client network, and increase access to human resources.
Around the same time Isidore was approached by Homeboy Industries, the social enterprise was hit with an unexpected obstacle that posed an immediate threat to the organization’s survival and anticipated acquisition.
With no specific worker’s compensation classification for e-waste recycling, since its founding, Isidore’s insurance providers had classified them as a Wholesaler. However, despite no changes in their operations, in the Fall of 2015, the Workers Compensation Insurance Rating Bureau of California unexpectedly reclassified Isidore as a “Junk Dealer” which caused their insurance company to immediately drop their coverage. Unable to operate without the proper insurance, Isidore was forced to purchase a new insurance policy that was nearly five times more costly than the original policy – draining their bank account and threatening a full closure before the acquisition by Homeboy Industries was able to happen.
Isidore needed a loan to lengthen their runway until they were able to successfully change their business classification or until the Homeboy Industries’ investment deal closed.
In order to ensure Isidore had the financial runway to overcome this obstacle, Open Road Alliance provided a $35,000 Recoverable Grant to the social enterprise. This bridge funding allowed Isidore to recover financially from the unexpected insurance costs by helping to cover payroll and some operating costs through a financially turbulent time.
In receiving a recoverable grant, Isidore was able to sustain work for individuals facing obstacles to employment and continuing executing their proven model to reduce e-waste in landfills.
Since being awarded the recoverable grant, Isidore successfully appealed its reclassification and received majority stake investment from Homeboy Industries and is today operating as Homeboy Recycling with plans for expansion in the near future.
Learn more about Homeboy Recycling at HomeboyRecycling.com >>