Carbogenics, the spinout that turns difficult-to-recycle paper waste including disposable coffee cups into a carbon product that boosts green energy production, has raised nearly £500,000 in an investment led by Techstart Ventures.
Techstart is joined in the seed investment round by Old College Capital, the University’s venture fund managed by EI, and private investors.
Carbogenics takes low-value paper waste and turns it into CreChar®, a proprietary carbon-rich porous material. The company’s first application of its product adds CreChar to the feed material of anaerobic digestion (AD) plants.
This significantly increases the plant’s output and can reduce feedstock costs. At the end of its life, CreChar is returned to the soil to work as fertiliser and lock away carbon for hundreds of years, offering significant carbon savings.
Variants of CreChar targeted at other applications will be launched in 2020.
The fundraising supports the first phase of an ambitious growth plan. Carbogenics will build a pilot production facility in Perthshire, seek to prove its first product in industrial AD plants, and expand its team.
“The seed investment is a major milestone for Carbogenics. We will now accelerate our progress towards launching CreChar on the anaerobic digestion market and we look forward to growing our team and product range over the next year.
“There are billions of tonnes of waste out there that our technology can turn into new sustainable carbon products to create value for our clients and the environment.”
– Carbogenics co-founder and CEO Dr Jan Mumme.
Techstart, which specialises in seed investment for ambitious early stage companies based in Scotland and Northern Ireland, provided considerable support to the company during the investment process. Carbogenics is the ninth investment from Techstart’s new Scottish fund, which was launched earlier this year.
“Carbogenics’ ambition is to be the market leader in carbon upcycling and we’re delighted to support the company with this investment.
“We’re excited about the scale of this opportunity and have enjoyed working with the Carbogenics team, the University, Edinburgh Innovations, Old College Capital and the other investors at this round.”
– Robert Richmond, Investment Director, Techstart Ventures.
EI has provided extensive business support to the Carbogenics team since 2015, including regular in-house advice, introduction to external advisers, help to secure grant funding and support with the company formation process.
“We’re delighted to join this investment, which is the first time we’ve worked alongside Techstart.
“The investment shows our joint confidence that Carbogenics holds great promise for carbon sequestration and green power generation, and is the latest affirmation of the credibility of the innovations pipeline from the University of Edinburgh.”
– Dr George Baxter, CEO, Edinburgh Innovations.
With support from EI, Carbogenics has won awards including the top prize in Converge 2018 and major awards at Scottish EDGE and Shell Springboard. The company is also a part of the EU-funded Climate-KIC Accelerator programme at the Edinburgh Centre for Carbon Innovation.
Carbogenics was launched by co-founders Dr Jan Mumme, Franziska Srocke and Lidia Krzynowek on the basis of work by Mumme in the University’s School of GeoSciences. Formerly a researcher in Germany, he relocated to Edinburgh to work at the University’s UK Biochar Research Centre and to establish his specialist spinout company in Edinburgh’s vibrant ecosystem.
The company uses pyrolysis to convert waste such as plastic-lined paper cups, low-grade recycled paper, cardboard and papermill sludge into gases, bio-oil and CreChar. The gas and bio-oil can be used to produce energy or can be upgraded for the recovery of valuable chemicals.
The production of CreChar reduces carbon dioxide emissions by up to half when compared with incineration of paper waste, and every tonne of CreChar produced and added to the biogas production process could save a total of 10 tonnes of CO2 through increased biogas generation and reduction of emissions.
Europe’s 20,000 AD plants present a potential market of 1 million tonnes of CreChar a year, which would reduce emissions by 10 million tonnes of CO2 equivalent a year, equal to a quarter of Scotland’s annual CO2 emissions, and would sequester carbon into the soil equivalent to 1 million tonnes of CO2 emissions per year.
The UK currently exports 4 million tonnes of paper waste for incineration in other countries, which is more than enough to produce sufficient CreChar to supply Europe’s AD plants.