EcoATM Raises $14.4M Series A With Claremont Creek And Coinstar Leading The Deal

EcoATM said it closed a $14.4 million Series A funding with Coinstar, Inc. and Claremont Creek leading the deal. The San Diego company operates a series of kiosks that buy back and recycle consumer electronics. As part of the transaction, outstanding notes were converted and Silicon Valley Bank will provide a significant amount of venture debt to the company. The funds will be used for product commercialization and launch.

PRESS RELEASE

COINSTAR AND CLAREMONT CREEK VENTURES CO-LEAD

SERIES A INVESTMENT IN ecoATM™

ecoATM Also Announces National Science Foundation Grant And First Patent

San Diego, Calif., February16, 2011 – ecoATM, the award-winning San Diego start-up known for its commitment to the environment and its innovative kiosks that buy-back and recycle consumer electronics, today announced it has closed the first round of its Series A preferred stock offering.  Coinstar, Inc. and Claremont Creek led the financing. In addition, other outstanding notes were converted to Series A. Silicon Valley Bank (SVB) will also provide a significant amount of venture debt to the company.  The aggregate amount raised is $14.4 million.  The funds will be used for commercialization and product launch.

Randy Hawks, Managing Director at Claremont Creek Ventures, and Gary Cohen, Senior Vice President, Marketing & Customer Experience at Redbox, a wholly-owned subsidiary of Coinstar, Inc., will join the ecoATM board of directors.

ecoATM Incentivizes Consumers to Recycle Electronic Devices

According to the Consumer Electronics Association, U.S. consumers collectively buy about 500 million new electronic gadgets each year. Upgrade cycles grow shorter  as gadget manufacturers tempt consumers with new features. The average U.S. household now owns 26 different consumer electronic devices for a staggering total of nearly 3 billion devices, many of which are no longer in use. The majority of these devices are still in good working condition when consumers upgrade. Unfortunately, few practical options exist for consumers to responsibly resell or recycle these devices so the vast majority of them still enter our landfills as toxic eWaste, the fastest growing segment of our national waste stream. To solve this technology problem, ecoATM turned to technology itself and developed the ultimate solution to this vexing problem by providing convenience, immediate financial incentive, and personal data removal for consumers. ecoATM trial locations have already collected tens of thousands of devices over the past year and paid out hundreds of thousands of dollars in return for recycling.

“ecoATM provides tons of value to the consumer by giving them cash for their digital clunkers and simultaneously managing the recycling in a very earth-friendly way,” said Randy Hawks, Managing Director of Claremont Creek Ventures. “They also have a smart business model. That’s why we invested.”

“ecoATM is an innovative automated retail concept that we believe will resonate with today’s environmentally minded consumers,” said Gregg Kaplan, President and Chief Operating Officer of Coinstar, Inc.  “We invested in ecoATM because we believe they have a viable and promising business and we are committed to fostering innovation in automated retail.”

“Coinstar is a leading provider in automated retail solutions, and Claremont is a leader in clean-tech venture investing,” said Tom Tullie, Chairman and CEO, ecoATM. “It’s a perfect combination to have these two investors lead our Series A as we ramp into broader commercialization.”

ecoATM Also Announces National Science Foundation Grant And First Patent

In a concurrent announcement, ecoATM revealed that it has been awarded a Phase 1 grant by the National Science Foundation and that the United States Patent and Trademark Office had granted their first patent on the ecoATM system.

About Coinstar, Inc.

Coinstar, Inc. (Nasdaq: CSTR) is a leading provider of automated retail solutions offering convenient services that make life easier for consumers and drive incremental traffic and revenue for retailers. The company’s core automated retail businesses include the well-known redbox® self-service DVD rental and Coinstar® self-service coin-counting brands. The company has approximately 30,200 DVD kiosks and 18,900 coin-counting kiosks in supermarkets, drug stores, mass merchants, financial institutions, convenience stores, and restaurants. For more information, visit www.coinstar.com.