In this episode of What If Instead?, Tom Christenson, CEO of TBAuctions, starts with a stark image: "Imagine a world drowning in discarded machines—a nightmare for the planet!"
Guest: Tom Christenson, CEO of TBAuctions
Hosts:
Alejandro Juárez Crawford
On ITSPmagazine 👉 https://www.itspmagazine.com/itspmagazine-podcast-radio-hosts/alejandro-juarez-crawford
Miriam Plavin-Masterman
On ITSPmagazine 👉 https://www.itspmagazine.com/itspmagazine-podcast-radio-hosts/miriam-plavin-masterman
______________________
Episode Introduction
In this episode of What If Instead?, Tom Christenson, CEO of TBAuctions, starts with a stark image: "Imagine a world drowning in discarded machines—a nightmare for the planet!"
Tom presents a thought-provoking ‘what if instead….’ “What if,” he asks, “we found customers that could actually use [machinery and equipment] for another five or seven years and they put it back onto their books as new?”
Tune in to discover how we can stop throwing away useful equipment and focus on giving it a second or third life.
______________________
Resources
Klaravik Sustainability Report: http://bit.ly/40fNpyn
______________________
Episode Sponsors
Are you interested in sponsoring an ITSPmagazine Channel?
👉 https://www.itspmagazine.com/sponsor-the-itspmagazine-podcast-network
______________________
For more podcast stories from What If Instead? Podcast with Alejandro Juárez Crawford and Miriam Plavin-Masterman, visit: https://www.itspmagazine.com/itspmagazine-podcast-radio-hosts/alejandro-juarez-crawford and https://www.itspmagazine.com/itspmagazine-podcast-radio-hosts/miriam-plavin-masterman
The Future Life of Heavy Equipment | A Conversation with Tom Christenson | What If Instead? Podcast with Alejandro Juárez Crawford and Miriam Plavin-Masterman
Alejandro Juárez Crawford (00:00)
It's sort of easy to harsh on the super creative office, right? Where it became, what, sometimes in the aughts or the 90s, it started with the dot-com boom, didn't it? Where you just sort of knew that you were in that office with little skateboards and various games. There'd be a foosball table and there'd be either Herman Miller chairs, those super comfortable, meshy, bouncy chairs, or there would be lots of big
balls all over the is this something that's become so insufferable, such a cliche, that it shouldn't be allowed? Where do you two stand on office furniture and what it says about whether we're playing or working and whether we're insufferably creative or just getting our creative on?
Tom Christenson (00:45)
Well, if you don't set the right context and the right atmosphere with neon signs, air on chairs, bouncy balls, concrete floors, and no ceiling tiles, you're not a tech company. And so the first thing you got to do is rip down the ceiling tiles, throw those things out, get rid of them, hopefully recycle up the carpets, hopefully recycle those, leave the exposed concrete.
get your bouncy balls and put up a couple of neon signs and all of a sudden you've become our perspective.
Alejandro Juárez Crawford (01:18)
I like this. So if you're pitching a tech VC, your main job is to just talk about how you got rid of all these things and replaced all these things, so your tech is gonna be Yeah.
Tom Christenson (01:27)
Yeah, pretty much. Yeah. I mean, if you have
a good 10 page pitch deck that kind of defines the problem, defines your solution as the answer to that problem, simplifies the revenue model to say how you're going to make money. then boom, you got some neon signs. You basically increase your is ultimately what most tech companies are trying to
Alejandro Juárez Crawford (01:46)
So what is the neon sign below done to your valuation,
Tom Christenson (01:49)
Good question. We haven't tested that yet. So we're still working on the next valuation. our current owners are quite the development of our company. And the NEON is just sort of the accentuates the success.
Alejandro Juárez Crawford (01:52)
And you.
why tech from when we're neon science mid 20th century? Why does this show advanced software going
Tom Christenson (02:09)
Yeah.
Well,
it's sort of the embodiment of sustainability. Because the old neon sign of Las Vegas days was a massive consumer of electricity, polluter in the environment. The modern LED sign is a very efficient LED. It's a very efficient way of expressing your personality and also still being relatively sustainable in the economy.
Mim Plavin-Masterman (02:38)
all seriousness though, it's migrated, right? It's not just the tech companies. Now it's like the bougie coffee you know, come in and they all have it and they're all like, sip, drink, you know, order some coffee no one's heard of or whatever.
Tom Christenson (02:43)
They all have it, yeah, because...
Yeah.
Yeah.
my mom has one too. You welcome home. She's got this big pink neon sign, welcome home in her living room. She was like, I gotta have one. So it's proliferating all across America and Europe.
Mim Plavin-Masterman (03:02)
Yes. Who is Tom Christensen? That is a great question. So we're, delighted to have Tom Christensen with us today. He joins us from Amsterdam and just so we're clear, Alejandro and I are on the East coast of the U S Tom is in Amsterdam. We're doing this across time zones, across countries, cause that's how we roll. Tom is joining us to talk about his work with TB auctions.
Alejandro Juárez Crawford (03:02)
So who is Tom Christensen?
Mim Plavin-Masterman (03:27)
which is a multi-brand digital auction platform for depreciated business assets. And so when companies have assets that have basically outlived their accounting useful life, this is a way for them to be disposed of, and it's a way for people to get access to these industrial assets at a really wonderful reduced price. Just to give people a perspective, because it's not an area that I think we're typically used to thinking about, the company did about a billion and a half dollars in revenue
last year from brokering these sales. So this is a very large company and then they operate in the Nordic countries, operate in Benelux, they operate in Britain and then throughout continental Europe. Have I left out any countries? I'm not sure.
Tom Christenson (04:10)
No, that's pretty
much it. The full EU 27 spectrum, a couple of others that are not involved in the EU itself. yeah, we have sellers from about 32 countries and we support buyers from nearly 170 countries.
Alejandro Juárez Crawford (04:25)
You need these days an interplanetary plan. That's like slide 12, if you listen to how... Yeah, just saying.
Tom Christenson (04:29)
Well, you know, ultimately in the business pitch deck,
we do have the interplanetary plan. Yes. First we'll conquer North America, then the rest of the world, then we're going to Mars with Elon.
Alejandro Juárez Crawford (04:34)
Is that before the neon signs?
I like that. You remember the old New York map, New Yorkers map of the world where like, you know, ninth Avenue then comes right at the other continents. I'm interested that your sequence sort of, think America was right before Mars. Did I get that right? The rest of the world was somewhere in there.
Tom Christenson (04:45)
Yeah.
Yeah, it's on the path, you know. The way we are
Mim Plavin-Masterman (04:56)
Feels
Tom Christenson (04:57)
today
Mim Plavin-Masterman (04:57)
on brand.
Tom Christenson (04:57)
in the United States, America is just about as close to aliens as complete.
Alejandro Juárez Crawford (05:02)
I'm taking what I am Alejandro Juarez Crawford, My brilliant and unstoppable co-host is Mim Plaven, Masterman and
We're on a mission to make experiments of your own as normal as watching videos on your phone. Welcome to What If Instead, the Now, Tom, as I've learned about you and TB Auctions, and I'm not assuming the two are synonymous, I understood at least one What If Instead, if I'm getting it right, if I'm grokking it, to be What If Instead large equipment.
from a tractor to an MRI machine all the way through to the kinds of equipment we use in industry that regular people don't always know the words for, right? That these large pieces of equipment don't just get thrown out at the end of their life. And both at the end of their accounting life, shall we say, while they still have useful life.
it sounds like your what-if instead is that these pieces of equipment should have a second life and that we can use digital auctions not just to get a table on Facebook Marketplace from the next town over, but to make this kind of second life possible. Am I getting that right? Talk to us please about what the big what-if instead for you is at
Tom Christenson (06:27)
Yeah. Well, I fundamental of the platform that we're building is based on the idea of what if instead of throwing this stuff out in the trash, we actually enabled someone else to use it. And you can look across the wide variety of categories of business, used business equipment that have served their useful life, you know, three, four, five, seven years as
kind of what most organizations, businesses buy things for at full price, and then they depreciate over a five or a six or a seven year basis. And then at the end of that depreciated life, the asset on their accounting books is useless. But most of those machines, most of that equipment, whether it's, as we were joking about before, the Herman Miller Aeron chair or an MRI machine,
or a tractor or many, many, many, almost anything you can imagine that was built and purchased in roughly five to seven years, a business has depreciated that. And they're looking then to replace that asset. And rather than throwing that asset into the trash, into the garbage bins, what if we found customers that could actually use it for another five or seven years and they put it back onto their books as new?
and then they depreciate it for the next five to seven. And that's the fundamental of finding the auction mechanism and what TB auctions enables for our sellers. They can sell these used assets, they can get value, appreciate that value and actually recognize it as a profit on their P &L and then enable it to be forward, which is awesome because offsets getting new raw materials extracted from the ground to create new machines.
It also offsets all the CO2 associated with the manufacturing of those machines just by enabling their life a little bit longer than if they just went into the scrap yard.
Mim Plavin-Masterman (08:27)
Fascinating. So to follow up on that for a bit, you had mentioned that you have sellers in 32 countries and buyers in 107 countries. Since it's a two-sided market, which is the harder side to build? And which one are you more focused on
Tom Christenson (08:47)
Yeah, it's a great
Auctions, much like any marketplace business, Amazon Marketplace, Uber, marketplace of drivers and riders, you always have a bit of a tension between seller and the For us, though, the biggest challenge is sourcing the supply, getting the regular stream of assets that are available for sale.
so that the bidders, because everyone's always out looking to buy something, the bidders can find the product that they're looking for at the time that they're looking for us, bigger challenge on that two-sided marketplace is not finding buyers, but rather it is finding the sellers with the assets that trust the mechanism of auctioning versus other mechanisms of either the certainty of disposal, throwing it into the trash,
or trying to sell it with a classified ad or giving it back to the dealer or the original equipment manufacturer who produced the asset in the first place.
Mim Plavin-Masterman (09:48)
And so how do you get them to trust you to do that process?
Tom Christenson (09:52)
It's a fundamental part of building our with a degree of transparency so that the seller trusts that the auction mechanism will get them a good value. It's also ensuring that the seller has access to the biggest set of bidders. For us, we've spent a lot of money building the scale in what I refer to as the flywheel effect of our business.
to have over 700,000 bidders. And when you have that degree of liquidity in a marketplace, I know it's a boatload of people that are looking to buy things. Having that access to 700,000 people that potentially, or businesses that potentially are interested in your product is a real attractor for them. value proposition to a seller who would otherwise be looking to throw the asset away is that in an auction,
Mim Plavin-Masterman (10:23)
Okay.
Tom Christenson (10:46)
In seven or 14 days, the asset is sold and they get a good value because there's a significant amount of interest in the 700,000 bidders that are looking at those assets.
Alejandro Juárez Crawford (10:57)
Tom, you might have seen Mim smile broadly when you mentioned flywheel effects. We have just written a book, Mim and I, which comes out next summer, called One Size Fits And we focus in it on the wrong kinds of flywheel effects, where in our search for a flywheel, this is back to that VC deck we talked about, in our search for ultimate scalability.
right, and something that will just replicate and the idea of the flywheel for users not familiar is it just keeps turning without any extra energy applied, we...
Tom Christenson (11:31)
but it takes a
lot of energy to get it started. So, you know, you think of a windmill or a watermill, it takes a lot of effort, but then yeah, it's self-sustained. It's awesome.
Alejandro Juárez Crawford (11:42)
And there are in business, I would posit good flywheels and bad flywheels. And maybe I'm stating this in too much of a moral way. There are flywheels that are good at meeting the needs in a very responsive way of a lot of types of customers. And then there are flywheels that tend to put us in a position of if our need isn't exactly what
my large multinational bank is used to dealing with, then it might as well not exist. And so I wonder if you could talk about in what ways is the flywheel you've bought, you've built, I should say, in what ways is the flywheel that you've built effective at meeting lots of disparate needs, especially since we know that you're routing much of this equipment to folks who otherwise might not have access to it. Can you talk to us about that?
Tom Christenson (12:33)
Yeah.
I had never really thought of Batman versus the Joker concept of good fly wheels and bad fly wheels. It's an interesting, an interesting one. if you really think about it, you know, there are, there are bad fly wheels and bad fly wheels that
Mim Plavin-Masterman (12:40)
you
versus Joker, yeah.
Alejandro Juárez Crawford (12:44)
Ha
Tom Christenson (12:50)
you know, they're self-sustaining because you have a whole bunch sellers of badly produced products. You you could almost even say the Amazon flywheel is creating a whole bunch of garbage. In fact, I was talking to a candidate for a position that I'm recruiting for here who said that they were leaving another home marketplace. I won't say the name, but they were leaving them because they felt bad. were just...
promoting the sale of more cheap furniture and they didn't want to add more to the waste that's being she was very attracted to the flywheel of TB auctions because we're creating the self-sustaining momentum of putting assets back to use and enabling the ability for especially developing economies to have access
Alejandro Juárez Crawford (13:30)
Thanks
Tom Christenson (13:44)
discounted and to depreciated assets as you described earlier, where, hey, an MRI machine that's no longer useful to the British medical system is extremely valuable in Indonesia, the Philippines, and in India. And after it's been depreciated after five years, we can now enable that product to be sold, shipped, and reused.
allow those types of organizations to purchase 10, 15 or 20 machines, where otherwise their more limited budgets might only enable a purchase of one or two machines. So the flywheel of our business adding more of these assets into the reusable world, I think is a very positive type of a flywheel effect. When I say our market opportunity in Europe,
I've often said is about 250 billion euros of assets are sold, used business assets are sold every year. That's really a floor, it's not a ceiling. That floor is representative of just the assets that are currently traded versus all the other assets. It's so much easier to just throw it out into the trash. If we create a simple, easy to use flywheel effect, folks will end up being able to put those assets to use.
Alejandro Juárez Crawford (14:52)
Mmm.
Tom Christenson (15:05)
other economies or at other users.
Alejandro Juárez Crawford (15:08)
So a majority, or at least many of our guests on What If instead are innovators and enablers of innovation in the global South. And had folks who are really leading globally on vehicle to grid solutions in ways that the power centers of the global North have barely conceived of. We've had folks leading on
healthcare innovation that deal with the intricacies of culture and stakeholders in a specific And I want to ask you...
How do you think about both the reverse innovation piece here, which I believe shouldn't really be called reverse, but with respect to Govindarajan and Trimble, advantages that can be had when the Global South isn't just taking the leaving of Europe, for example, but is
coming up with solutions that can show the way for others. And I don't mean this as a gotcha question in any way. I was that kid who myself, all my clothes were from secondhand shops growing up, whereas I might have felt iffy about an Army-Navy source, which is maybe even a better analogy. at first I had to, should I be embarrassed that I don't have a new nylon backpack? I have this Army surplus backpack, which my dad was really into.
And now I'm like, of course, that's what I should have been doing. That surplus needed to go somewhere. And so I'm actually, think your model is incredible and I want to make sure I'm not sounding like I'm critiquing it. But how do you think about not just the innovation relationship, but making sure that even if incomes are lower in many places, we don't get into a dynamic where, well, you have the less energy efficient equipment because it's from 10 years ago or what have
Do you think about these issues?
Tom Christenson (17:08)
don't think about it too often, but it is kind of funny. You were way ahead of your time because all of my nieces and basically only shop in secondhand stores and Salvation Army. And that's kind of the cool way as opposed to buying the new stuff. you know, I think that the feedback that we get from buyers is that just so much thanks.
that there is an easy way for them to acquire these assets that otherwise would not enable them to continue to operate their business or provide care for patients. you know, whether the white plastic has converted a little bit to the yellow plastic or it's a Euro five engine on a tractor, that yeah, it is going to pollute a little bit more than a brand new Euro six or Euro seven tractor, but they haven't had to
create a new tractor or they can actually get a tractor that works versus the tractor that just does not work and is a Euro three type of a polluter. You know, our customers generally are very, very happy that they have access to the assets and that there's a mechanism to actually find them. And that's really fundamentally one of the hardest things is finding the asset that you're looking for and us being now a platform at scale.
that's building that flywheel it is an easy way for people to get the assets that they're looking for.
Alejandro Juárez Crawford (18:36)
yeah. And we know, of course, that building a new piece of equipment has a huge carbon footprint. Right. So it's years for an EV driver, to to start getting the carbon benefits. For example, I mean, a consumer. So so you're inherently doing something really powerful when you extend the life and we don't need to build a new one. And you could add to that. Look, there is a growing
Tom Christenson (18:41)
Of course, yeah.
Alejandro Juárez Crawford (19:00)
Every time an economy develops, especially in these industrial ways, there's a growing need for equipment and we can't necessarily as a planet always be building a new piece of equipment. So I think it's very interesting where you're taking it, but I want to ask one crazy question. May I? is there any piece potentially in the vision that can involve relationships with third party retrofitters?
Tom Christenson (19:18)
Yeah, of course.
Alejandro Juárez Crawford (19:25)
who I'm thinking I've done some consulting on a building will be retrofit to be passive house, for example, right? Is there any relationship where you can take a great piece of metal, right? Stick with a tractor, an MRI machine for now, and you can retrofit it with a source, or is that just crazy town?
Tom Christenson (19:47)
It's absolutely not crazy have not explored that yet. However, if you just look at some of these examples, especially in the classic car trade, which we're not in, but the classic car trade takes a lot of these older, much less much more of an energy pollutant type of a vehicle and changes out the type of a...
potential I think actually exists because the metal functionality of tractors, construction it doesn't change. inefficient to your point is the engine. And so is there a possibility in this world where we're helping extend the life of the shell and then partnering with someone that can replace that core, that engine.
Alejandro Juárez Crawford (20:30)
Yeah.
Tom Christenson (20:36)
make that more efficient. I think that's a super interesting We haven't done it yet, but it certainly is quite intriguing.
Alejandro Juárez Crawford (20:39)
Go on, go on, go on.
So last thing on this, because Mim, I know you have burning questions, which is if you've ever been to Havana or to Cuba, There's this thing,
Tom Christenson (20:49)
yeah, I have actually. And
Alejandro Juárez Crawford (20:52)
On the one hand, it's like one big classic car show, right? The whole country. But you also see, you know, a car built in the 50s might have a body, but invariably the window, the handles to open up your windows and to open your doors have needed to be replaced. So I mention this because it was fun just now as you spoke, imagining a world where
Instead of being like, here's the older, more yellowed piece of equipment. It's here is that classic piece of equipment in the beautiful way that we used to make it before we figured out how to make the auto body cheaper with state of the art, power, renewable energy power, for example.
Tom Christenson (21:38)
Yeah, no, can see it in the construction to your point, yeah, even within MRI equipment or the equipment, computer and technology equipment, the casing is still fine. It works perfectly. Sometimes you just need a new jam that on in the In a what-if instead space where instead of you're just extending the life, you're also refurbishing it and upgrading it.
but still using the majority of what the waste is, which is the product around it, the physical product, that would be really fascinating if we could potentially find a solution for that that was efficient and
Mim Plavin-Masterman (22:15)
that's, I mean, that was sort of my question about the economics of it, right? If these organizations assets are relatively limited, I would think it would have to easy or inexpensive solution to If they're buying stuff at 40 % of cost, they might not have, I'm just gonna throw out a number, they might not have $100,000 to retrofit every guess that's...
That would be my question of the cost benefit trade off to them of how you would do that.
Tom Christenson (22:43)
Yeah.
I think because we are playing in life of an asset is really still in that five, three to seven year horizon.
It might be the next stage, you know, and I don't think we have a solution for that second donor yet and where they can take the asset to And I guess it really is an interesting thing to push really are looking for the second life of the asset. I don't think there is an invention yet that looks at the third life and the third life is the one to both of your points. That's kind of replacing smaller
Mim Plavin-Masterman (22:59)
Mm hmm. Right.
Yeah.
Alejandro Juárez Crawford (23:16)
Mm.
Tom Christenson (23:22)
guts in the middle, the engine, the stuff that's easy to replace, easy air quotes, and then enables the physical shell to continue think that is a really interesting thing that another inventor is going to come up with, and we haven't gotten there at this point.
Alejandro Juárez Crawford (23:39)
I mean, imagine the job generation, right? Back to the Cuban cars for a moment. There were so many incredible was there during researching entrepreneurship during a period when a lot of chemists and physics teachers had become, started businesses owning their own cab, right? And so I would interview them. And one of the things you realize, these were these brilliant scientist types.
who had so much tinkering ability that they were keeping these 65 year old cars on the road. And so what would the job creation possibilities, I I think all the time about how do you create waves of local jobs, right? All around the world. And I can imagine that that third life, you know, maybe the platform, TB Auctions, Second Life, in this what if instead scenario that we're playing with,
could have all these local folks who then do the extend third life or to adapt to other applications. You can start to imagine a world where equipment, it's like a Genet movie if I'm saying his name right, where there's sort of contraptions that have been jerry-rigged and retrofitted and MacGyvered all around the world to various purposes.
Tom Christenson (24:58)
Yeah.
Well, in a lot of ways they already experience in Cuba, I've seen it in Cuba. You've seen it. I've seen it in India, where again, the asset is retrofit. The engine is replaced. All the parts and pieces are replaced. And you don't have to extract more material from the ground to build the shell, which is really what's the useful part for the human beings.
you really do create that kind of ecosystem of the third or fourth or fifth life of an asset.
Alejandro Juárez Crawford (25:32)
And it slices off the most capital intensive piece. This is what I'm fascinated with as we say this. Making that shell, know, you just, aren't a lot of small car companies, right? I mean, there are folks who do a few, you just, know, MRI production is not a cottage industry, right? MRI machine production. Because it's super capital intensive.
Well, go ahead, Mim.
Mim Plavin-Masterman (25:52)
so the, well, the, the
planned obsolescence was actually my next question because you talked earlier, Tom, about like, we're really good at selling and producing junk. Right. And not, not us as a society, as a society, as a society, we're really good at selling and producing junk and things that break down really quickly and things that wear out. one time you say it was on all of that. So this is, I'm not saying you I'm saying, right. Okay. But.
Tom Christenson (26:03)
God, that's not Jung. Yeah, yeah, yeah, yeah. Right.
Yeah. Well,
one of the reasons for that is that there is no easy market for the secondary life. So if you're buying a piece of furniture, you're basically buying it for five to seven years and then throw it away. But if you buy a piece of furniture with the idea that in five or seven years you can sell it and get 50 % residual value, there's a different economic principle.
Mim Plavin-Masterman (26:41)
And I'm thinking about this idea about the holding onto something or repurposing items, because we're seeing a lot of this in the small goods market. know, like people upcycle, they take something that's, they break it apart. I've seen this, like, my daughter does this. She buys old sweaters at the thrift store, takes all the yarn and like makes them into new stuff because it's better quality. But I just wonder how that plays out.
Tom Christenson (27:05)
Thank you.
Mim Plavin-Masterman (27:10)
in this kind of a field, like A, is planned obsolescence less of a thing? And B, if it's not, then how are these buyers making sure they actually get, you know, five to seven years of life out of what they're buying?
Tom Christenson (27:23)
It's an interesting question and I don't know if the products that are being offered for sale now that are five to seven years old will be different than the products that are being offered for sale in five or seven haven't really done analysis to look at the history to say, you know, because everyone says, hey, I used to buy a washing machine.
and it would work for 20 years. Now I buy a washing machine, it works for five really interesting. I don't know if the planned obsolescence mentality, especially for the type of used business asset that we're looking at, will change the dynamics of the marketplace. Right now, I think a lot of that planned obsolescence is around consumer good. And your clothing that you buy, a Uniqlo.
the furniture that you buy on Wayfair, those types of things are kind of designed and we all know that they're designed to be disposable. I think generally still today, a business asset is not designed with that type of But I haven't explored it. I think it's a really interesting thing to see how that market will evolve in the next five to seven year generation of equipment.
Alejandro Juárez Crawford (28:38)
think you're bringing up something very important, which is total cost of ownership is something a business will often analyze and most consumers don't have the wherewithal to analyze. And if you're thinking just for listeners, total cost of ownership is you think in terms of not just how much your inkjet printer costs, but also...
Tom Christenson (28:41)
Exactly.
Mim Plavin-Masterman (28:50)
Right. Right.
Alejandro Juárez Crawford (29:00)
how much it costs to replace the cartridges and how frequently and when it broke and all this stuff, right? you're thinking of the...
Tom Christenson (29:07)
businesses are
professional buyers. So yeah, they have teams of people that think through those things. sitting in their underwear buying a printer on Amazon does that? Probably no one.
Alejandro Juárez Crawford (29:16)
Well,
during COVID, no, seriously, but right, you just didn't know they were in their underwear because they had a tie on top. But seriously, the TCO point, right, the business buyer is thinking I mean, there may be exceptions to that because a large firm has people to do that. Whereas one of things I'm very interested in your model is, we talked at the beginning, can a large mega farm, can equipment become accessible to a small farmer?
Tom Christenson (29:22)
Yeah.
Alejandro Juárez Crawford (29:43)
may have less wherewithal to maybe more like a consumer in not having a team of people to calculate TCO. But I wanted to actually take this to a place YouTube brought up a few minutes ago. I interviewed a guy called Tom Sakey, the TerraCycle founder, some years ago And he said, way we think about
buying today is put as many things, if you're Amazon, you want people to put as many things in the basket as possible and replace that basket as often as possible, right? That that is a vision of life. It's a vision that the little mouse with shiny objects in each of us is very susceptible to. It's a vision that we can be easily manipulated to do more of until we also need to be customers of Marie Kondo because we're both
filling that basket over and over and then having to take our larger and larger houses, now I'm thinking of Westerners in the suburbs, and constantly take the junk out of them. So that's a vision of life. And both of two made me think of, I think where you're taking us is there could be a different way things work, not just in the platforms that enable it, but in how we think about these things across the world, around the world.
What I wish I could ask you if I knew how to formulate the question is, what does life look like if we go the full distance with what we're saying, where I'm a small farmer in Texas, like we've interviewed on this show. I am a person doing healthcare in Acre, such as we've interviewed in this show. And suddenly world is not just world we're living in now.
I either have the budget for something capital intensive to make or I don't. But instead it's a budget that it's a world where we've talked about where there's all this tinkering and repurposing and reverse innovation going on and it's a world very different from that fill up your basket as many times as you can to a world where it's the access to stuff is something that has revenue models but they're more in the direction that you're taking.
Tom Christenson (31:48)
mean, it's that concept of kind of a global marketplace where you can easily find what you're looking for, regardless of physically where it is today and be able to procure it, knowing that the procurement of that asset, regardless of where it is in the world, even when you figure out the CO2 of the transportation, you say it's a hell of a lot more efficient to use someone else's asset
for the next three to five years than to go to my local store and buy another one. Because ultimately you're going to end up having to have that transportation It would be really phenomenal if there was kind of this global marketplace where you could find these things and trade And eventually do it without currency would be fantastic.
Alejandro Juárez Crawford (32:33)
in your vision version.
your version of the world, container ships are filled not with lots of new junk that's going to go into landfill.
Tom Christenson (32:41)
it's really interesting you raise the concept of container ships. But if you look at global trade right now, many container ships, not all, travel fully laden from parts of the world to other parts of the world and then travel back completely And if you had this global marketplace, you know, yes, you would have the trade of goods balancing that out. And so those ships would not be running empty.
be moving goods that need to be reused all around the world. And that could be a brand new piece of equipment that was used for five years in the Philippines that then gets shipped to Texas and another piece of equipment from California that shipped to Europe and a piece that's then shipped from Norway down to South America. And that's not happening today. And it's partly because it's difficult to find
the assets that you want. And part of what we're trying to build is that you can connect what we call our technology platform, these different storefronts all around the world so that those goods can be discovered, found, and then traded. And I think that's 100 % right. That is the seamless goal of the reuse economy where you can find things that...
you know, again, are used in one area of the world that can be reused in another area of the world and back and forth and back and forth for a hell of a long time, hell of a longer time than they're currently being used today.
Alejandro Juárez Crawford (34:08)
You've done something incredible economically just what's in the
Tom Christenson (34:11)
all the empty ship
problem. Yeah, a smug sport and a whole bunch of other companies would be thrilled to hear that idea.
Mim Plavin-Masterman (34:13)
You
Alejandro Juárez Crawford (34:16)
I mean, it's beyond the empty ship problem though, because it's potentially filling the waste ship problem, right? The truth is, and I know that the reason that I buy a lot of plastic junk that I throw out next year is not directly related to how a company buys a big piece of equipment, but it is about a way of being, a way of existing. And if we got used to the idea that you're describing, just as in the example of used clothing, where for your daughters, I think you said,
Tom Christenson (34:23)
Exactly,
Alejandro Juárez Crawford (34:46)
suddenly it's cool to have, know, maybe even the closing has been restitched or something. That's become something that's aspirational. Well similarly, when I was a kid I was sometimes made fun of for those things, right? So it becomes a thing where we're not just accumulating waste, which by the way, we're shipping in container ships around the world, right?
But we were using our ability to transfer thing to repurpose the carbon costs is lower. And the thing that I'm most excited, if I might add one more thing back to my 2007 iMac, until last year when they made it totally impossible to run the new Mac OS on it, I had replaced virtually everything inside it.
the best part is I wasn't a skilled tinkerer, but there were these great, you know, there was the iFixit site, which would sell you the kit and show you how and show you how not to screw it up, which I usually did anyway, but eventually would, you know, the point is that with that new fan, the company that made the little squeegee that could allow you to take the thing off and the suction cups, all that is innovation and job creation. And so the biggest thing that I get excited about beyond the container ships is the idea that the
Tom Christenson (35:32)
Yeah. Yeah. Yeah.
Alejandro Juárez Crawford (35:57)
vision of the economy you're describing is one where there can be a local skills, job creation, then, every person with that job is buying something locally and you then build local capacity that otherwise is not built because you're just importing it. This is really Jane Jacobs' idea from somewhere else.
Tom Christenson (36:12)
Yeah.
Yeah, no, absolutely. 100 % true.
Mim Plavin-Masterman (36:16)
So given this idea about importing knowledge from elsewhere, do you see TB Auctions knowledge being imported? Where is it now?
Tom Christenson (36:26)
of an auction as a mechanism owners of depreciated assets to get a relatively quick quick conversion to to find a further user for those products is not a new we're different in is that it's
fully online and digital. The traditional business asset world has had a requirement that the seller bring the product onto a warehouse or onto some sort of a physical location where then the assets are And Europe is very much ahead of the United States in terms of peer-to-peer sales of business assets. And that's where the seller,
doesn't bring the product to a location to be sold, the seller just sells it from their own garage, warehouse, or as we look this model, we've been able to connect local brands and a global economy. We're looking at the United States as a potential opportunity for where we can do that. And the US and the sale of used business assets, there really isn't that kind of concept of fully
online that we think we can really truly innovate with. part of our growth strategy is to start looking at opportunities to bring our technology into the US auction space, the business to business auction space, where traditionally it has been very much more of an type of a business that's highly inefficient. So yeah, that's where we're going. But this is a global industry.
And as we were talking about earlier, got acquaintances in this industry from Australia to the Philippines to South Africa, where there are assets that need to be used by others, construction assets, mining assets, that have, they've outlived their use in Australia, they can easily be put to use in Chile. And there really is no global connector.
of this type of used asset. And that's really where we see where we're going to be going, because we've built the technology that allows us to do it across Europe. Europe is very complex, very difficult. There's a lot of different regulations from country to country. If we've mastered it here, we do think we have the skill set to go kind of global and really start to flatten out the world.
It's worked
for technology, it's worked for communications, the world is not yet flat for assets. And that's really where we see the future of our company going, is flattening that out so that it's easy to move those assets around.
Alejandro Juárez Crawford (39:12)
What's amazing about that is the innovative potential and beyond potential, the innovators are there in each of those parts of the world. now, I'm teaching, I lead along with facilitators all over the world, a global session which has groups in two of the three countries you mentioned. These are young people who are solving problems
what if we used the digital age, and very much the way you're saying, to connect these dots, because we have a global economy and yet we lack global innovation.
in so many cases. We're still coming up with practices as if it were the 19th or at least the 20th or maybe the early 20th century. how are you enabling those small players, it's a three-part question, you can pick your favorite part,
through your user experience, through your platform. How are you enabling? Just talk to us a about what are you doing to make these transactions possible? Finding out about the equipment, buying the equipment in ways that it might not be obvious to a user of Facebook Marketplace. Secondly, just how does this depreciation thing work with the source companies? And thirdly, if you're interested, if you have time, I'm intrigued in how you're planning on making this work in the Americas.
It sometimes seems in the United States as if we have advanced and less advanced economies next to each other in this country and within the country. And I'm wondering if you're working within country or a lot of it has to do with Mexico, Canada, South America, Central America and so forth.
Tom Christenson (40:45)
You might have to prompt me again with the three as I go through have a goal of making it trivially easy for a buyer or a seller to meet each other, through kind of just the ease of listing the product. humans. We are driven by our eyeballs. Having good
pictures of the product that's available for sale is super important. So making it very easy, utilizing technology to help a seller get the right photos of the product that they're selling, to have a high quality description of what it is that they're selling and making that an easy process. So it's not going to take them three and a half, four hours to do that.
Alejandro Juárez Crawford (41:29)
actually loved your line, Trivially Easy. So for entrepreneurs in the digital space listening to this podcast, hear those words. Everything else is great, but until you make it Trivially Easy, go on.
Tom Christenson (41:34)
Yeah.
Yeah, it's
sort of my North Star for all of my product teams to say, make it trivially I love the expression. think it's, I'm not the owner of the expression. I've borrowed it from, from mentors I've had in my life, but, doing that and making it easy for the transaction. And that's not just the listing of the product, but if you're selling a used asset that you still have a loan associated with that used asset. Cause sometimes the loans last longer than the asset itself.
or at least they last longer than the appreciable life of the also help with the process of paying off the loan, all the paperwork associated a lease to end or the loan to end. And some of these buyers are buying assets that are 10, 20, 100,000 euros of value, providing the access to a new lender. So we provide value added services around lending.
ending a loan relationship, creating a new loan relationship, ending a lease relationship, creating a new lease relationship, similarly with insurances and warranties. When you buy a new used asset, you kind of want to make sure it's still going to work. And so still having a warranty on that product is of value to you. So we like to make it easy to get the access to the same products and services that would be associated
with purchasing a new piece that we have not really solved for is the transportation and the logistics. And that is a really, really hard nut to crack. It's on our roadmap to help figure out how do you facilitate those logistics, really to talk about what we have been discussing for the last half hour or so is the ease of the transportation of these assets at low CO2 emissions rates so that
customers can get the products that they're looking for. We do that in experiments with some of our assets here and there, but it is an area that we continue to work on so that we can make it, like I said, a trivially easy experience to buy and sell used assets from the financing of it, the warranties associated with it, and the transport logistics of it. We do do a lot in terms of helping sellers the equipment, especially
When it's a factory that's been closed down in Germany and potentially the equipment from that used factory is going to be moved to a new factory that's being established in Indonesia, we do also provide export and customs and other types of services that enable the product to move, but the logistics, we're still not an expert in helping to provide that service to
Alejandro Juárez Crawford (44:22)
made me think of one thing and then I'm happy to give you the last couple of prompts and we really appreciate your taking these few extra minutes with us. work with innovators in the South African the BNelson movement and One of the things that I've been learning recently, it's quite striking, if you look solar voltaic panels installation in South Africa,
in I think 15 months between 22 and 23, it more than quadrupled. And what's interesting is this is happening because solar panels, you can just get them and you don't have to be on grid to do this, right? This is...
Tom Christenson (44:56)
Yeah, and the value,
the cost of them have gone down dramatically, you know, absolutely.
Alejandro Juárez Crawford (45:02)
And so
so what you're making me think is that so many other things, the container ship and the large shell and everything we've talked about in this conversation, that solar panels are impossible because they're cheap and easy to transport. And so it's cheaper for me, South Africa is country that suffers many power outages to just install, right? And I also work with folks who do peer to peer, right?
But are there possibilities in what you're doing that suddenly we could make local resourcefulness possible? That's just magnifying and mushrooming these capacities with more than just something that's flat and easy to transport. That's what you're really making me excited about.
Tom Christenson (45:49)
and it is, I mean, it's super exciting, the opportunity there and the ability to get these assets into areas where the frankly, to do some work on them is a hell of a lot cheaper than where the asset started from. Yeah, you really can start thinking about applying some labor to do the modification that's necessary to not just extend the life, but also potentially even change the dynamic of the product that's moved from one
to another location.
Alejandro Juárez Crawford (46:18)
let's seize on that changing of the product dynamic, because that, think, is the most exciting piece of all, is that we kind of assume our use cases, right? The MRI machine is actually the classic and Trimble case, right? huge. We install it, we use it in this way, we get these approvals. But there are so many ways we can use these products in new ways and innovate their use, just as in consumer tech.
Often the really interesting use is consumer
Tom Christenson (46:48)
Yeah, absolutely.
Alejandro Juárez Crawford (46:49)
last two things that I had on my mind, was to just understand what we mean by depreciation. Maybe we'll just leave listeners with the fact that often in terms of how you budget when you're a large you can get, because you've fully costed, you've fully paid for in your accounting, a piece of equipment by a certain point in time,
Tom Christenson (46:49)
Super cool.
Alejandro Juárez Crawford (47:09)
After that, any cash you get for that equipment is, it's gravy, it's free money. Is that an over simplistic way to put it, Tom? I just wanted to make sure listeners got this.
Tom Christenson (47:17)
It's
highly simplistic, but it's a hundred percent know, you buy an asset for a hundred, you depreciate it 20 over five years. It's zero. You sell it for Hey, it's money in the bank. It's free profit. You're a hundred percent right.
Alejandro Juárez Crawford (47:32)
I'm going to take this as a high compliment. My favorite thing, and I got this frankly from Arnold Schwarzenegger's email, and it's from Bruce Lee. It says, one does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity. So thanks for what you're doing to make that possible in the world of equipment.
for calling me simplistic and right.
Mim Plavin-Masterman (48:03)
You're the only one who could get away with that, Tom. So thank you.
Tom Christenson (48:06)
Hardly. You simplified a complex problem. That's a beautiful thing. That's my favorite in the world is to do that.
Alejandro Juárez Crawford (48:13)
Well, it's a beautiful thing what you're doing, Tom, and thank you for making us think here on What If a real pleasure and we wish you a great
Tom Christenson (48:22)
Awesome, thank you guys so much.