Søborg-based Cellugy, an industrial BioTech startup, is creating novel, natural, biofabricated cellulose-based solutions, to replace fossil-based materials in a variety of industrial applications. The company has raised €4.9 million in seed funding to expand the production of its EcoFLEXY dry cellulose product to industrial volumes.
Along with new U.S.-based investment Joyance Partners and returning investors PSV DeepTech, The Footprint Firm, and EIFO, the round was led by ICIG Ventures of Germany and Unconventional Ventures of Denmark.
Accelerating EcoFLEXY:
The money will hasten the commercialization and implementation of EcoFLEXY, which is presently in the pilot stage. This entails a significant rise in manufacturing, from kilograms to several tons per year. With the money obtained, Cellugy will be able to increase its manufacturing capacity and start producing commercial products to meet the growing demand from customers. Additionally, the money will enable new product co-development agreements that will broaden EcoFLEXY’s application scope and increase the company’s IP portfolio and workforce.
Many of the top personal care brands on the market promise to create formulas that are more ecologically friendly and sustainable, which drives up demand for natural, biodegradable materials like cellulose. The scientific team at Cellugy has created a novel platform technology that uses bacteria to make cellulose, allowing microorganisms that produce cellulose to be converted from sugar into high-purity crystalline cellulose. The platform develops completely biodegradable and biobased substitutes for petrochemicals that are high in carbon.
Cosmetic compositions widely employ petrochemical compounds derived from fossil feedstocks because of their desired functional qualities. These substances, however, may be hazardous to the environment due to pollution, increased carbon emissions, and potentially microplastic intake by humans. Certain petrochemical compounds may pose health hazards. Therefore, ingredient makers must bridge the gap between safety, application, and sustainability.
Related Content: Sustainable Textile Upcycling startup Re-Fresh Global snaps €1.1M
CEO and co-founder of Cellugy, Dr. Isabel Alvarez-Martos, stated:
“Using petrochemical components derived from fossil fuels is currently the most important sustainability concern in the manufacturing of personal care products. We genuinely see a future completely free from these polluting ingredients with our technology. Our goal is to create sustainable solutions for common products; therefore, collaborating with impact-driven investors makes sense to us. Together, we can accomplish those objectives.”
The rapidly expanding worldwide cosmetics market is on track to reach a value of USD 415.29 billion by 2028. Customers are looking more and more for bio-based substitutes as health and sustainability become more important concerns. At a compound annual growth rate (CAGR) of 9.76%, the market for natural and organic cosmetics is expected to reach USD 50.46 billion by 2027.
Alvarez-Martos stated:
“This investment round will be instrumental in scaling up EcoFLEXY’s production and distribution, allowing us to meet the surging demand for high-performance, sustainable beauty ingredients. Additionally, it will support additional collaborations on product co-development for EcoFLEXY, enabling us to realize the full potential of the technology and create new application domains within this intended market. We see ourselves as paving the way for others’ creativity and opening doors to healthier, more environmentally friendly solutions that are kind to the skin and the environment by supporting sustainable material choices and creative manufacturing techniques.”
Cellugy’s Innovative Solution:
The personal care business lacks readily available alternatives that satisfy the cost and performance criteria of petrochemicals, despite the evident demand for high-quality, sustainable alternatives. The “drop-in” solution offered by Cellugy is especially appealing because it is readily scalable, works with standard equipment, and can be integrated into already-existing infrastructure.
The most recent round of funding strengthens Cellugy’s already robust support even more. Current investors, including PSV DeepTech, EIFO, and The Footprint Firm, contribute nearly half of the investment round, providing both money and experience. Lead investor ICIG Ventures brings extra essential industry-specific connections, knowledge, and direction. International Chemical Investors Group is a privately held German industrial group with market-oriented chemical platforms and enterprises.
Investors Thoughts:
Dr. Pelin Yilmaz, Investment Director at ICIG Ventures, continued:
“ICIG Ventures’ strategic move to invest in Cellugy demonstrates our dedication to supporting ideas that advance sustainability in the industrial sector. Cellugy’s breakthrough in biofabricated cellulose technology not only aligns with our mission to support green technology but also promises to revolutionize the personal care industry and beyond. Cellugy’s effective business model, cross-industry application potential, and sustainable petrochemical substitute make for a powerful combination. We feel very thrilled about the opportunities to support Cellugy’s expansion. Our financial support demonstrates our faith in Cellugy’s personnel, innovations, and industry-changing goals.”
Unconventional Ventures, a new investor, also enters the round. Their emphasis on social effects and sustainability is similar to Cellugy’s long-term goals. Furthermore, Cellugy’s basic ideals of diversity and people empowerment are reflected in Unconventional Ventures’ commitment to maximizing the potential of diverse founding teams and underrepresented groups behind impact digital enterprises.
According to Thea Messel, founder and general partner of Unconventional Ventures:
“Meeting Isabel, Paruntungan, and Deby especially pleased us because they share the goal of developing a sustainable substitute for petrochemical chemicals. Their innovative platform technology has the potential to disrupt industries like textiles and food and revolutionize the personal care industry, which is in dire need of more sustainable alternatives. As impact investors, we feel honored to support the founders on their growth journey. Their unwavering commitment to transforming scientific research into cutting-edge, sustainable commercial products inspires us.”
With a robust portfolio in the BioTech and personal care industries, new investor Joyance Partners offers comprehensive insights into strategies for commercialization and scaling up. Additionally, it benefits from strong CPG ties that make it easier to reach international-branded clients.
