Innovation has always been the lifeblood of green chemistry; without innovation green chemistry could not possibly thrive let alone advance. Some green brands may be able to rely heavily on their “enviro-cred”—catering to the small percentage of “dark green” consumers that purchase green at every opportunity. But companies focused on green chemistry and engineering understand that any green product they make must also be a better performer and cost-competitive. Achieving this is difficult at times but certainly not impossible. And, achieving it is an all-around win for companies, consumers, and the planet.
So why isn’t it that easy to do? Any new entry into commodity products, whether it is green or not, must compete with a highly sophisticated petroleum-based infrastructure, a high-volume marketplace, and low margins. Scale-up costs can be high, and markets uncertain. Entrepreneurs seeking venture capital find that investors believe there is too much risk in funding a company that isn’t offering the golden ticket—a stable, established supply chain, comparable but preferably improved product properties for half the cost, and large market opportunity. So how can an entrepreneur approach this situation?
Recently I interviewed Adam Malofsky, President & CEO of Bioformix, Inc., a company that is producing high-performance sustainable polymers. Malofsky is a serial entrepreneur and chemist who’s passionate about a market-driven approach to green chemistry. Prior to starting Bioformix, Malofsky did extensive market research to understand what a successful sustainable and green chemistry would require. What he realized is that a green chemistry inspired platform molecule would have to have a supply chain that looked just like a petroleum platform molecule, where 5, 10 or 15 chemicals produce 95% of all the chemicals we use in the world. It would also need to be able to fit into a system of traditional unit operations and processes, and it would need to enable a new capability.
Malofsky calls it “enabling chemistries,” which he describes as “products sold for what they allow you to do versus what they are.” In other words, are you creating something that can help someone do something they couldn’t do before?
The solution that Malofsky “rediscovered” and is now developing was methylene malonates—first discovered in 1877 but no one had ever managed to produce on an industrial scale. Bioformix refined the malonates to achieve stability, and in doing so found a polymer platform that cuts the cost of production, eliminates solvents, and can be used at room temperature. For example, using this new platform Bioformix estimates that their solution could cut up to 60-70% of energy costs in a traditional automotive plant by eliminating both the heating and curing time for coatings. To date Bioformix has raised $24 million from industrial users and venture capitalists. The industrial users total revenue represents well over $500 billion, representing a sizable chunk of the global economy. Few companies can claim that level of support.
Today, Bioformix is manufacturing their first product Nexabond™, a fast curing wood adhesive, and has plans to expand across a variety of markets.
Interestingly, while Bioformix innovations achieve the green chemistry principles of reducing waste, conserving energy, eliminating solvents, and are biologically benign, they are not bio-based. The economics of purchasing bio-based feedstocks for a small company like this just isn’t there—although the company hopes to be able to switch when bio-based pricing becomes attractive.
“Too many chemists have no business training,” Malofsky says. “You have to start from the business case. A customer has to want the product very badly. You have to be able to say, ‘I’m going to solve this big issue. I’m going to eliminate this big cost.’”
To Malofsky, drop-in products are a real risk. Manufacturers are wary of changing their inputs, larger competitors can decide to undercut you, or buy you out and discontinue the product. “I would never do a drop in product in my entire life,” states Malofsky. “It’s a bad investment.” The idea behind enabling chemistries is that you can sell your products at a higher price because they have better capabilities.
Malofsky isn’t the only CEO encouraging this approach. Mike Knauf, CEO of Rivertop Renewables, also recently wrote, “We have the capability – today – to fundamentally reshape the future of chemistry, and in doing so, positively shape the future economic, social and environmental sustainability of the planet. But to do so, we need to move beyond drop-in replacements to the development of novel chemicals.”
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