Fake Meat as Cleantech Investment

The New York Times today has a fascinating feature about a new crop of businesses developing better-tasting meat substitutes. According to the Times, Demand for meat alternatives is growing, fueled by trends as varied as increased vegetarianism and concerns over the impact of industrial-scale animal husbandry on the environment. The trend has also attracted a host of unlikely investors, including Biz Stone and Evan Williams of Twitter, Bill Gates and, most recently, Li Ka-shing, the Hong Kong magnate. It goes on to say that the sustainability boon of veggie-based protein over animal protein has also attracted venture firm Kleiner Perkins Caufield & Byers to the category. Since I write about cleantech start ups and food, I figure this is an interesting market niche to examine. But my first question reading the story was, would I eat this? That is not very analytical. The companies featured in the story are Beyond Meat, which makes a veggie protein chicken that apparently is indistinguishable from the real thing in a dish like chicken salad, Gardein, which makes products including – amazingly to me – fake fish, and Hampton Creek, a start up that has developed a versatile and healthy egg substitute made from Canadian yellow peas. Setting aside my selfish question of whether these products would appeal to me, a non-vegetarian, I’m going to try to set the stage for an analysis of the likely success of these ventures. The companies state they are hoping to attract mainstream eaters. That means they will have to score a win on the three most important qualities for mainstream grocery shoppers: 1) Taste 2) Cost 3) Convenience. The point of the Times story is that these up and comers are aiming to beat out today’s fake meat brands on taste and texture. Many fake meat products are easier to store and prepare than raw meat, so that’s a plus. That leaves cost – if they can sell the products for just a bit less than the real thing that would make a huge difference and would expand the market for fake meat. To get the costs down while they scale production, firms like Beyond Meat will first have to appeal to the early adopter/healthy eater/vegan/vegetarian/flexitarian who is willing to try something new. But while some shoppers may be swayed by sustainability claims, these technology-based firms will have to navigate the growing tide of shoppers of all types who eschew mystery products, high-tech food processing, and food additives such as colors, flavors, preservatives and even texturizers. Shoppers know that even natural flavoring additives may be chemically similar to MSG (particularly flavors derived from yeast). This crowd...

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Green Business Plan Competition: Start your engines

The ACS Green Chemistry Institute will be hosting a business plan competition on June 18, 2014 at the 18th Annual Green Chemistry and Engineering Conference, which will be held outside of Washington D.C. The competition is for early stage ideas – but not ideas for renewable energy production or biofuels (there are no shortage of competitions for those). If you have an idea for a green innovation that only chemists would truly understand, this is your chance. The first deadline to be aware of is April 25 – that’s when to submit your 10-15 slide PowerPoint presentation and optional YouTube video. Just aim to be done by Earth Day and you’ll be right on schedule. The competition website includes a host of great links to advice on how to communicate and advance your start-up idea. And don’t forget to review (memorize them!) the 12 Principles of Green...

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Gates Invests In KiOR, Elevance Coming to U.S.

Bill Gates (yes, that Bill Gates), through a fund called Gates Ventures, is investing $15 million in advanced biofuels firm KiOR. Gates is not a huge cleantech investor generally (though he has backed other firms such as the young MIT spin-off Liquid Metal Battery). So it’s rather interesting that he’s decided to invest in KiOR, which is not at all an “early stage” tech firm – in fact, it is a public company. Vinod Khosla, a tech pioneer who is much more well known as a cleantech investor with deep pockets, has committed to putting in another $85 million to KiOR in debt and stock. Khosla was instrumental in the founding of the company and has been an unusually loyal and generous benefactor. With this $100 million infusion, KiOR says it will be able to build out its capacity-doubling project at its Columbus, Miss. facility (see Khosla, Kior Double Down). If we go back in time a bit to the end of the second quarter, we see that KiOR had started shipping its drop-in fuels (gasoline, diesel, heating oil) made from wood. But the amount of production was behind schedule, and its cash position was delicate, to say the least. At the time, analysts suggested that the firm should bring in a corporate partner such as a refining company. But that’s not what happened. It is clearly good news for KiOR that it has a few friends who are willing to keep dipping in to their own pockets to make sure its first facility can reach the point where it generates enough cash to fund operations – and presumably prove out that KiOR’s next commercial facility (planned for Natchez, Miss.) will be profitable. And its only fair to note that the same analysts who suggested KiOR get an additional large investor are also very bullish on the company. So what is there to like about KiOR? KiOR has significantly increased uptime at the Columbus facility It has produced and shipped actual product Yields are rising Drop-in biofuel is considered a much more desirable product than ethanol KiOR’s technology can accommodate cheap feedstocks (the expansion will use waste railroad ties) The main negative, in fact, was the near-term need for additional capital. And even back in August – before both recent investment announcements – analysts at Credit Suisse and Raymond James had an outperform rating on KiOR’s stock. Does all of this mean that KiOR is a guaranteed win? No, of course not. But I find it interesting how far KiOR is poised to go with the help of a few true believers. Elevance comes to the U.S. Elevance is...

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Khosla, KiOR Double Down in Mississippi

When the second quarter ended, drop-in cellulosic biofuels maker KiOR was in the process of ramping up production at its first large-scale (eventually 13 million gal per year) plant in Columbus, Miss. The company told investors that it hoped to double the capacity at the Columbus location, at an estimated cost of $225 million. The company had cash reserves of just under $12 million. But, it had one asset that is incredibly valuable – the backing of venture capitalist Vinod Khosla. Khosla has agreed to fork over $50 million – half of it likely to come from his own personal funds – to seed an investment strategy that may bring in other deep pocketed parties such as an industrial partner or traditional lender. KiOR makes gasoline and diesel (not ethanol) from cellulosic feedstocks (wood) via fermentation. Khosla was there at the company’s beginning – he helped midwife it into a startup in 2007 and invested in it before – and now after – its IPO in June 2011. The company went public at $15 a share in its pre-production, pre-revenue era (it is now trading around $2.50). With the Columbus plant, KiOR is in the very first crop of producers of cellulosic biofuels. Investors love that the company’s output is not subject to blend walls the way ethanol production is. But getting steady-state, high levels of output from a first-of-its-kind facility is pretty much unheard of in the second-gen biofuels industry. And so KiOR is hoping it will produce 1 million gal this year, as it does the start-stop-fix-start thing. That’s why it is interesting that rather than hold out to generate revenue from Columbus I, KiOR plans to use what has been learned already to literally double down on its bet. Interestingly, part of the motivation to build the Columbus II plant is the availability of cheap railroad ties at that location. In the press release Khosla (who owns a majority stake) stands by his company: “While KiOR has faced normal start-up issues at the Columbus I facility, I believe that the Columbus I facility has proven that KiOR’s technology can meet and over time exceed the technology performance metrics of approximately 80 gallons per bone dry ton I expected for 2015, driving toward the ultimate goal of producing 92 gallons of hydrocarbon fuels (or over 150 gallons of ethanol equivalent) per bone dry ton of biomass, particularly given the Company’s continued progress in research and development. I believe that KiOR’s proprietary technology platform is substantially better, and can produce hydrocarbon fuels at lower cost, than any other currently visible biofuels fermentation technology, cellulosic or otherwise, that I am...

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There’s Still Hope for Energy & Materials Start-ups

Funding for cleantech and related start-ups can be feast or famine. Government, venture capital, and corporate backing ebbs and flows. One constant, though, is that technology entrepreneurs should never miss a chance to get in front of investors. On February 25, start up executives will pitch to investors at the ARPA-E Energy Innovation Summit in Washington, DC. An event run by Future Energy will provide the space, a slide template, and a panel of experts for Q&A. In the audience will be people from corporations and other kinds of investors who will be attending the ARPA-E gathering to hear from the likes of Michael Bloomberg and the folks who dispense money from DOE. Future Energy is a part of a larger organization called Ultralight Startups. Shell, through its program Shell Game Changer, is the main sponsor. Future Energy founder Graham Lawlor tells Cleantech Chemistry that unlike internet startups which are legion and fill to overflowing many investor pitch events, his events are specific to energy and cleantech and he has to go out and find tech start-ups for the slots. But he’s not worried, because the scientists and engineers are out there with good ideas. In 2012, Future Energy held two events in Boston and two in New York. This year they’ll head also to Silicon Valley. At the ARPA-E event in DC, two of the companies pitching won their slots through an online voting mechanism. You can go to their website to apply for future events through the first half of the year (tell your friends!). You can see a video of United Catalyst at an event last year pitching technology for inorganic catalysts designed for cellulosic ethanol production. The pitches are only 3 minutes long, so its good to pare down your story to bare essentials. Also investing seed money in energy start-ups is Lux Capital, which today announced commitments totally $245 million for its third venture fund. The fund is fairly broad- the firm is looking for unusual opportunities in energy, healthcare and technology. The ever-enthusiastic Josh Wolfe, Lux Capital co-founder and managing partner, describes his strategy this way: “At Lux, we are sticking to our knitting to build a concentrated portfolio of extraordinary companies in unconventional areas,” says Wolfe. “Many of the themes and entrepreneurs we’re excited about—in 3D printing, metamaterials, robotics and breakthroughs in solid-state electronics—are non-obvious, and that’s by design. We believe the combination of brilliant entrepreneurs and deep scientific innovation drives immense industry shifts and profits. Both at Lux and our companies, we’re growing rapidly and calling for the boldest and brightest that want to invent and invest in the future.”...

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Thin film solar maker Miasolé bought by China’s Hanergy

Hanergy, a China-based renewable energy company, announced today that it has completed its acquisition of thin-film solar firm Miasolé. The buyer first reached a purchase agreement with Miasolé’s investors in September. Of the many photovoltaic manufacturers out there – and/or recently bankrupt – Miasolé is one of the most elegant. And not just because of its attractive-sounding name (news reports online have stripped it of the accent aigu — it’s pronounced MiasolA). Miasolé makes thin film solar cells of the copper indium gallium selenide variety. This is an attractive technology because it is possible to make CIGS as efficient as heavier traditional polysilicon solar PV. The first thin-film technology was based on amorphous silicon (a technology that Hanergy plans to abandon), which was much less efficient than traditional solar cells. In theory, CIGS can be manufactured in long, flat, flexible sheets and installed in places that cannot support other kinds of solar panels. For now, CIGS material on the market has an upper-bound efficiency of about 12% or so, while traditional solar starts there and goes up a bit. CIGS are more expensive, and are much more difficult to manufacture. For Miasolé’s part, in May the company reported that NREL confirmed a 15.5% efficiency on its newest commercial, flexible CIGS cells. It is not clear what the efficiency of a fully installed system would be. But it shows that this firm has been pushing the technology. Back in 2011, it worked with semiconductor maker Intel to help it ramp up its manufacturing. At the time, the company said it was using a low-cost sputtering technology for materials deposition. News reports have estimated that Hanergy spent about $120 million to buy Miasolé’, a company that was valued as high as $1.2 billion in 2008. Hanergy makes most of its money by generating power from hydroelectric installations. Last year it also snapped up Solibro, a unit of Germany’s solar manufacturer Q-Cells. Hanergy says it will keep the Miasolé CIGS manufacturing operations going in California. Meanwhile, another CIGS start-up, SoloPower, recently began production in Portland,...

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