Tag Archives: SoyWorks

The boom in bio-based materials and chemicals is really a boom in synthetic biology

Venture capitalists (VCs) invested $3.1 billion in bio-based chemicals and materials developers since 2004. As many of those start-ups reach megaton scales and launch IPOs, Lux Research analysts sought to find which technologies venture investors favored. This week’s graphic comes from their just published report (client registration required), in which analysts tracked 177 venture transactions involving 79 companies operating in five technology categories – biocomposites, bioprocessing, thermochemical processes, crop modification, and algae. In short, they found:

Bioprocessing developers brewed up $1.89 billion in 96 deals. Bioprocessing developers – especially synthetic biology companies – landed more than half the total venture capital invested since 2004. Encompassing technologies like fermentation, phage display, natural breeding and synthetic biology, all bioprocessing platforms employ some sort of organism as a “factory” for creating products as diverse as sweeteners and catalyst supports. Intrinsically flexible, these platforms enable the likes of Amyris, Codexis, LS9, and Solazyme to produce multiple products from multiple feedstocks, thus ensuring a relatively low-cost route to high-value compounds and providing a hedge against feedstock and product price volatility.

Thermochemical technologies raked in $577.0 million in 31 deals. Thermochemical processing encompasses technologies like gasification (Enerkem), catalysis (Avantium, Inventure), and acid hydrolysis (HCL Cleantech, BlueFire) that sometimes convert biomass to an intermediate like sugars or syngas, and sometimes go all the way to an end product. (e.g. Virent’s paraxylene is used in Pepsi’s famed 100% bio-based PET bottle

Crop modification companies harvested $371.7 million in 28 deals. IPOs are less common fates for crop modification companies which, as you may have guessed, modify crops to be more amenable and economical for use in bio-based materials and chemicals. Instead, companies in this category, like Athenix and FuturaGene, usually end up being acquired by the likes of Syngenta, Monsanto, DowAgro, or Bayer CropScience.

Algae developers saw $190.5 million in 13 deals. Notably, that figure only encompasses start-ups developing algae strains, cultivation systems, and processing equipment for creating industrial chemicals. Representative developers include Bio Architecture Lab, a macroalgae developer, and Israel’s Rosetta Green, which had raised $1.5 million in venture funds, but more recently brought in almost $6 million in an IPO on the Tel Aviv TASE. Excluded from this category are companies primarily developing fuels (which we cover in our Alternative Fuels Intelligence service), and companies like Solazyme and Green Pacific Biologicals that use algae for fermentation (and, thus, are categorized in bioprocessing, above).

Biocomposites developers brought in $108.9 million in a mere nine transactions. This category includes bioplastic blends, some starch plastics, and bio-based foams, from the likes of Cereplast, EcoSynthetix, Ecovative Design, and Entropy Resins. Because of the relatively simple nature of these technologies, VCs often don’t see them as investment opportunities – forcing companies like SoyWorks and Biop Biopolymer to find other sources of funding.

Source: Lux Research report “Seeding Investment in the Next Crop of Bio-Based Materials and Chemicals.”

Ranking advanced material delivery developers on the Lux Innovation Grid

Graphic of the WeekFollowing this blog’s recent comparison of companies developing bio/chemical targeted delivery platforms, this week’s graphic looks at a more experimental class of players: those developing advanced material delivery systems.

Advanced material delivery systems are based on novel substances to control placement and function of active ingredients. They rely on innovative approaches ranging from solid polymer shapes, alternative materials like cyclodextrins, and even blood cells harvested from the patient and loaded with drug. As a class, companies in this category are noticeably less mature than other targeted delivery companies, and they have yet to prove the value of their technology and their ability to execute.

The clear leaders are Monosol Rx and Capsulution Pharma. The former’s thin-film formulations of prescription and over-the-counter actives have led to steady growth in product development, partnerships, and sales revenue of around $10 million. Monosol also scores highly on technical value due to its product’s patient-friendly form factor and low cost compared pills or injections. Capsulution Pharma scores high technical marks for the bioavailability and loading of its solid polymer nanoparticles and polyelectrolyte-based drug delivery systems in targeting grave indications like glioblastoma. A strong management team drawn from corporations like Merck as well as start-ups helps boost Capsulation’s score on the business execution dimension.

Soy Works’ comparatively high technical score derives from the versatility and apparent effectiveness of the biodegradable plastic resins it’s developing based on soy protein. Representative applications include nutrient-releasing pots for houseplants and drug-loaded feed granules for animal medicine. The small founder-funded company is growing organically, but without partners or a cash infusion it struggles on business execution.

Source: Lux Research report “Ranking Targeted Delivery Technologies on the Lux Innovation Grid.”