ERI’s John Shegerian on How Businesses Can Change Communities

From providing ex-gang members with jobs to shaping the electronic waste industry, John Shegerian wants his businesses to make a difference in communities.

On this episode of Office Hours, host Spencer Rascoff spoke with Shegerian, co-founder and CEO of ERI, an electronic recycling company, about transforming a tortilla factory into a gang rehabilitation space and entering the e-waste industry before it was popular.

Shegerian worked for the infamous urban developer Ira Yellin, and he worked as the project manager at L.A.'s iconic Bradbury Building and the Grand Central Market. But the 1992 Los Angeles Riots made tenants weary of renting spaces Downtown. Shegerian found himself with the keys to a tortilla manufacturing facility when the owner left his equipment behind following the unrest.

Yellin and Shegerian had to find a way to fill their buildings. After seeing Boyle Heights activist and local priest Father Greg Boyle discuss how critical employment is in gang rehabilitation on “60 Minutes,” Shegerian approached him about bringing former gang members to work at the tortilla manufacturer. Homeboy Industries has since grown beyond tortillas, expanding into a bakery and merchandise.

“It changed my life and my wife's life to the point that we said, ‘No longer do we ever want to do a business again that just makes money’,” Shegerian said. “No shame in that as a capitalist country that we live in. But we also want any business we’re involved in to make a difference as well, just like Homeboy did, and still does.”

Shegerian went on to launch Financialaid.com, which intended to make student lending more accessible. After selling the company, he and financialaid.com employee Kevin Dillon sat down with Aaron Blum, a recent USC graduate who’d created an electronic recycling company, ERI.

“Electronic waste back then was the dark side of the technological revolution,” Shegerian said. “Guys like Steve Jobs, Bill Gates and all these other really, really bright, brilliant game-changing mavericks, they created these electronics to make our lives more fun and more interesting [and] our business lives more interconnected. The backside of that was never given any thought.”

As the tech industry expanded, Shegerian said there was a growing concern over what to do with the waste produced by old products. Many people would send them to landfills, where rain would distribute hazardous materials like lead and mercury into the groundwater supply.

ERI has since become the largest electronic waste recycling company, with services in approximately 700 cities. Aiming to be a zero-waste, zero-landfill and zero-emission business, Shegerian said ERI extracts the commodities from recycled materials and resells them. Shegerian added that large battery waste, like that created by electric vehicles, receives a disproportionate amount of interest, despite the continued importance of recycling smaller products.

“EV batteries got a lot more attention than post-consumer, small electronic batteries do,” he said. “But post-consumer small electronic batteries are massively as dangerous as EV batteries.”

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