Biotech startup raises €4.9m to “replace petrochemicals in personal care products”
Biotechnology company Cellugy has raised €4.9m in seed funding to scale up production of its dry cellulose ingredient EcoFlexy to industrial volumes.
According to the Danish startup, the natural, bio-fabricated, cellulose-based ingredient could replace petrochemicals in various industrial applications, including cosmetics.
The funding round was led by German company ICIG Ventures (the CVC arm of International Chemical Investors Group, a privately owned German industrial group) along with Denmark’s Unconventional Ventures, and a new US-based investor Joyance Partners, as well as with existing investors PSV DeepTech, The Footprint Firm, and EIFO.
The company said it planned to use the funding to “accelerate the deployment and commercialisation” of EcoFlexy, which is currently in the pilot phase, to increase annual production from kilos to several tonnes.
Expand manufacturing capacity
This injection of funds will allow Cellugy to expand its manufacturing capacity to commercial production, form new product development partnerships to take EcoFlexy into new application areas, and expand the company’s portfolio and headcount.
Its team of scientists have developed a special platform technology that uses bacteria to leverage cellulose-producing microorganisms to produce high-purity, crystalline cellulose derived from the bioconversion of sugar.
This creates fully bio-based and biodegradable alternatives to carbon-intensive petrochemicals. These sustainable alternatives are now in high demand, as many cosmetics brands are on a mission to create more environmentally conscious formulations.
Cellugy is providing a ‘drop-in’ alternative, which it said is “easily scalable, fits within standard equipment, and can be used in existing infrastructures.”
Petrochemical reliance a "critical sustainability issue"
Petrochemicals from fossil fuels are still heavily used in cosmetic formulations, but these ingredients cause increased carbon emissions, as well as a variety of environmental and safety issues surrounding microplastics.
“Reliance on fossil-based petrochemical ingredients is today’s most critical sustainability issue in producing personal care products. With our technology, we genuinely see a future completely free from these polluting ingredients,” said Dr Isabel Alvarez-Martos, CEO and co-founder at Cellugy.
“Our mission is to develop sustainable solutions for everyday products, so we’re naturally pleased to partner with impact-driven investors. Together, we can achieve those goals.”
Investment director at ICIG Ventures Dr Pelin Yilmaz said: “This sustainable alternative to petrochemicals, coupled with Cellugy's efficient business model and potential for cross-industry application, presents a compelling combination. We are particularly excited about the synergies in accompanying Cellugy in its scale-up journey. Our investment underscores our belief in Cellugy's team, technology, and their vision for a more sustainable industry.”
According to Dr Alvarez-Martos, this investment round will focus on scaling up EcoFlexy's production and distribution allowing the business to “meet the surging demand for sustainable, high-performance beauty ingredients.”
It will also fuel further product co-development partnerships for the ingredient, allowing the company to “unlock its full potential and develop new application areas within this target market.”
“By promoting sustainable materials choices and innovative production processes, we see ourselves as also enabling the innovation of others, leading the way to healthier, more ecological solutions that are both skin and planet friendly,” said Dr Alvarez-Martos.
