Welcome: Guest | Register | Login |

Startup looks to clean up with compostable diapers

Awardee Story Startup looks to clean up with compostable diapers
Date: Nov 04, 2018
Author: Kurt Nagl
Source: Crains Detroit ( click here to go to the source)

In a tank in Ann Arbor, bacteria and yeasts are hard at work creating something that eventually could change what happens to diapers after they've done their duty.

The company that owns the biopolymer is a University of Michigan spinoff that's working on materials that can absorb 300-400 times their own weight in liquid and also break down quickly in compost, which the diapers of today mostly don't.

The potential applications are wide-ranging -- from cosmetics and beauty products to soil erosion prevention. Eco-friendly diapers, though, are the end game for Ecovia Renewables Inc.

"I think the big pot of gold at the end of the rainbow is super-absorbents for hygiene just because the market is enormous," said Andrew Hertig, 32, co-founder and chief business officer of Ecovia.

Its business pitch for compostable diapers is grabbing investors' attention.

The company has raised $3.6 million in investment and grants since forming in 2014, including a $500,000 investment earlier this month from the University of Michigan, where it all started. In a recently expanded 5,500-square-foot lab at the Michigan Innovation Headquarters coworking space, a full-time team of six is ramping up efforts to commercialize years of research pioneered by a student and professor.
ADVERTISING
inRead invented by Teads

The startup traces back to the graduate work of Jeremy Minty, 34, company co-founder and CEO, who earned undergraduate and doctorate degrees in chemical engineering at UM. From 2008 to 2013, Minty worked alongside Xiaoxia "Nina" Lin, company co-founder and associate professor of chemical engineering at the university, on ways to produce the absorbent material.

The business is based on the engineering of microbial co-cultures for the production of superabsorbent biomolecules -- basically, making absorbent, biodegradable material.

The research was originally conceived in the framework of biomedicine, until the founders began to realize the commercial potential of their lab-grown material. The difficulty of the health care market, a time-sucking and expensive tangle of regulatory approvals, turned them in a different direction.

Around the time Minty spun his research out from the university and started seeking ways to jumpstart his company, he met Hertig, who had recently earned an MBA from Boston University and was looking for work. Hertig helped write a commercialization plan that earned the company its first grant -- a $225,000 Small Business Technology Transfer federal grant -- and joined the company shortly after.

The name Ecovia came from "via microbial eco system," which is the essence of its technology -- "engineering synthetic microbial communities for novel functions," Lin said. During a science entrepreneurship event hosted by Michigan State University in 2015, the team was dubbed simply as the "diaper guys." Rather than balk at the moniker, the company owned it.

"In truth, we take pride in being called the diaper guys because our mission is to reduce waste and make the world a more sustainable place," Hertig said. "I incorporated that theme into our presentation, having the audience close their eyes and visualize the great mound of diapers that we will save from entering the landfill."

That mound saved could also create a mound of money.

Revenue generated by diaper sales in the U.S. is expected to be around $6.2 billion this year with a compound annual growth rate of 1 percent, according to market research company Statista. Worldwide, the market is more than $50 billion.

While companies such as Irving, Texas-based Kimberly-Clark Corp., which makes Huggies, and Cincinnati-based Procter & Gamble, which makes Pampers, have the lion's share of the market, Ecovia is after a niche it believes will grow as companies and consumers try to curb environmental impact.

Around 20 billion disposable diapers, or 3.5 million tons, are thrown into landfills each year in the U.S. alone, according to the U.S. Environmental Protection Agency. The synthetic material of most diapers takes an estimated 500 years to break down completely.
Ecovia
Ecovia's biopolymers (top left and bottom right) are engineered through a complex process involving teams of microbes and turned into its signature superabsorbent material called AzuraGel (top right and bottom left), which the company intends to market to downstream diaper manufacturers as an eco-friendly alternative to synthetic diapers.

At full production, Ecovia estimates its diapers would be within 25 percent of the cost of conventional synthetic diapers, with the same absorption quality, company founders say. They believe consumers will be willing to pay more for the environmentally friendly alternative.

Ecovia also claims to have products superior to companies it would be competing against, such as Raleigh-based Tethis and Chicago-based Archer Daniels Midland Co., which also manufacture bio-based superabsorbent products, but with polymers based on modified starch.

Ecovia's diaper material, which it calls AzuraGel, is made up of an amino acid-based polymer that it says has a stronger chemical backbone, i.e., is more durable, and composts into carbon dioxide with no toxic footprint. The polymer is made in fermentation reactors, in which bacteria and yeast turn a waste product into a polymer that is then purified. Unusually, the process is completed by engineering a team of microbes rather than a single microbe, which is more common.

"Microbes live in diverse communities, working together to achieve something that any one alone cannot do," Lin said in a written statement. "The idea is to basically recruit specialists like in human society. By having each specialist do really well in their own job but also coordinating together, we can achieve something that is much bigger."

Producing the absorbent gel is a lengthy, complicated process on which the company's success depends. Since the technique was developed at UM, the university owns the patent.

Jeremy Nelson, senior licensing specialist at UM, said the school granted the company a license for research and development on the engineering process, and plans to issue a license for commercial rights once the patent is approved. The school is helping Ecovia through the application, typically a five-year process, which the company hopes to complete in the next year or two.

Ecovia's motivation is, of course, going to market, while UM strives to "close the loop on taxpayer-funded research," Nelson said.

He said that compared to the hundreds of patents he has worked on in his 10-year career, Ecovia's ranks near the top in terms of viability for a business.


Ecovia
Ian Graves, research and development engineer for Ecovia Renewables, works out of the company's lab at Michigan Innovation Headquarters in Ann Arbor, where a team of six develops polymers with several applications, including superabsorbent diapers.



For now, diapers are still a few years out. The plan is to focus on the higher-value cosmetic application of its material. Paris-based chemical manufacturer Seppic Inc. recognized the polymer's moisture retention capabilities and bought a minority share of the company with a $1 million investment in the spring. Hertig said as part of the multiyear deal, Ecovia's polymer will be used in the company's topical creams.

The company is in talks with hygiene companies to form a similar agreement. Hertig declined to say which ones, but he did say several of them are Fortune 500 companies active in the hygiene industry, and there's also international interest. He said the company aims to start prototyping the biodegradable superabsorbent diaper by the first quarter of 2019.

"The limitation will be on the supply side until we're able to build up infrastructure to reach scalability," he said.

With funding secure for the next couple years, Ecovia expects revenue to be minimal in 2019 before sustainability and industrialization in 2020, Hertig said. It will still apply for grants during that time. It's eyeing a $600,000 federal grant early next year, for example. Owners do not plan to raise more venture capital funding until 2020.

At its peak, Hertig sees Ecovia churning out 80,000-100,000 metric tons of its superabsorbent material per year at an asking price of $5 - $200 per kilogram, depending on use. That wouldn't be a bad haul for the diaper guys.

"If people remember us, they remember the mission," Hertig said.

Contact information

Innovation Development Institute, LLC

   45 Beach Bluff Avenue, Suite 300
     Swampscott,  MA 01907-1542

  Tel:  (781) 595-2920

  support@inknowvation.com