On a mission to make smartphone consumption circular, Swappie has just secured €108 million. The round was led by growth equity firm Verdane, specialising in tech-enabled, sustainable businesses, alongside existing investors Lifeline Ventures, Inventure, Reaktor Ventures and TESI.
Co-founded by Sami Marttinen (CEO) and Jiri Heinonen (CMO) in 2016, Swappie has the aim to provide customers with a way to upgrade their phones that is high quality, more affordable and environmentally friendly. The Helsinki-based startup is transforming the market by closing the loop on refurbished electronics for the first time and making the circular smartphone economy accessible to the masses. The overall market for used and refurbished smartphones is forecast to grow at an annual growth rate of 10.23% between 2022 and 2027.
Sami Marttinen, Co-founder and CEO of Swappie commented: “People are increasingly looking for ways to lessen their environmental impact, and locking on to the fact that smartphone purchasing is an area we can all address. We all want great tech, but it doesn’t need to cost the earth. We truly believe that Swappie can drive consumer awareness and trust in the sector by standardising quality, championing the role of sustainability, and making buying a refurbished smartphone as common as buying a used car.”
Sustainability is the buzz trend of the year and customers are becoming increasingly aware of the environmental impact of e-waste. The circular economy is believed to be one of the greatest ways to challenge the problem. Swappie has seen incredible demand from consumers to date, putting it at the forefront of a new wave of European purpose-driven tech scale-ups.
It is predicted that smartphones will generate 146 million tons of CO2 emissions in 2022, with 83% of these emissions coming from the manufacture, shipping, and first-year usage of the 1.4 billion new smartphones forecast to be shipped in 2022. It’s estimated that keeping a mobile phone in use for an extra year would save more than 2 million tonnes of emissions, demonstrating the positive environmental impact which Swappie can offer.
Founded on the basis of providing a high quality, more affordable and environmentally friendly way to upgrade smartphones, Swappie wants to make refurbished mainstream. To this end, the startup buys, refurbished and sells iPhones – ensuring high quality through controlling the whole value chain.
Unlike other players who work as a marketplace, partnering with external sellers to list their items, Swappie is unique in that it controls the entire supply chain, managing the entire process, from testing and repairing used handsets, to selling the refurbished devices direct to consumers, with at least a 12-month warranty.
Swappie refurbishes phones directly, to the highest standards using the latest technology — often meaning that their refurbished phones can be as robust as the original devices and in certain cases even stronger. And, the customer journey is like buying new, with live customer support, fast shipping options and a 12-month, or more, Swappie Warranty™.
The young company, which picked up €35.8 million in 2020, has been growing at an exciting rate in the last couple of years – growing sales by more than 220% in 2020. With 12 markets opened during the pandemic, Swappie holds the market leader position in the refurbished smartphone industry in the majority of its markets including Finland, Sweden and Italy, and has sold over 1 million refurbished smartphones to date.
Emma Lehikoinen, Chief Operating Officer at Swappie, stated: “The market opportunity for refurbished smartphones is vast. The total smartphone market is worth €100 billion in Europe, with used or refurbished phones making-up just over 10% of that today. With only 25% of pre-owned phones currently sold, there is huge potential for the refurbished phone market to grow. At Swappie we see this potential as a great opportunity to solidify our efforts in growing the current European operations”
The fresh funding will be used to bolster its European expansion and accelerate the growth of the category as a whole. Swappie will focus on scaling operations in its existing 15 markets across the continent, notably in Italy and Germany. Having almost doubled its market presence since last summer—increasing from 8 to 15 countries. This will involve increasing its headcount of 1,200 by the end of 2022, to 2,200 people.
Janne Holmia, Partner at Verdane added: “As people and companies progressively move towards a more sustainable lifestyle, the iPhone refurbishment and re-commerce space has grown considerably, and with it Swappie, which has demonstrated the potential to become Europe’s market leader in refurbished smartphones.”