While completing a gap analysis of the New York State climate tech community, we identified several funding gaps for hardware companies at pivotal points in achieving commercialization. MEIR helps to fill these gaps.
Globally, climate technology companies face unique challenges in accessing funding to develop and commercialize their products. Many of these companies are engineering new technologies and operating in emerging markets, which can present some uncertainty for risk-averse investors.
As the climate tech industry is still in its infancy, some investors may also lack the expertise to assess a product’s market potential or be discouraged by the prospect of long development time frames. This is why alternative funding sources and tailored support for scaling impactful climate technology is crucial.
Through its Manufacturing & Expertise-in-Residence program (MEIR), our initiative supporting climate technology, Scale For ClimateTech helped 42 startups advance their hardware from the prototype stage to manufacturing in volume. Together with NextCorps, in addition to providing grants, we engaged our technical expert community to solve emerging challenges and accelerate the launch of the recipients’ products.
MEIR has been instrumental in improving the production and commercial development of the participating startups’ products, which 85% of the companies attested to. The impact of these projects has had a ripple effect, including $12,978,010 in new funding, $527,242.16 in additional spending, the creation of 48 new jobs for additional employees, and a reduction in time-to-market by an average of 7.6 months.
SunThru and Folia Materials, two of the climate tech startups engaged in the MEIR program, have gotten closer to the tipping point by participating in the program.
SunThru: The future of energy-efficient windows
SunThru is a startup that develops transparent aerogel inserts for energy-efficient windows. Aerogels have been used in space travel since the 1960s by replacing a gel’s liquid component with gas while ensuring the gel’s structure is maintained. They have the lowest thermal conductivity of any known solid material and are also the lightest, which allows insulating things to keep them very warm or very cold depending on what you need, as well as strong enough to support a lot of weight even though its a lightweight material. This benefits the environment by reducing the need for gas, fuel oil, or electricity to power heating and cooling, which decreases emissions in general.
When used as window insulation, Sunthru’s aerogel inserts allow double-panel windows to exceed the new ENERGY STAR specifications, which at the moment, only triple-pane windows can meet the specifications. Triple-pane windows are too thick and heavy for existing buildings, require a major overhaul of existing manfuacturing lines, added labor for installation, and will further constrain the limited glass supply. SunThru technology solves these issues providing triple-pane performance at double-panel windows, as well as able provides cheaper and better insulation to low-income communities in colder climates.
(Photo source: sunthru.biz)
Scaling up with MEIR
Prior to joining the MEIR program, SunThru had manufactured highly transparent 5”x5” aerogel inserts using hydraulic hot press technology. To meet the dimensions required by the residential window industry and begin industry-standard testing, it needed to produce larger 20”x14” inserts but to do so using the existing technology would have cost approximately $600,000.
To increase production capacity while also reducing costs, SunThru invented scalable manufacturing technology called Supercritical Oven for Monolithic Aerogels (SOMA). To build out the first prototype, the company had planned to use its National Science Foundation (NSF) Phase I Award but could not access the funds immediately.
A MEIR grant enabled SunThru to build its SOMA400 prototype, a $30,000 device capable of manufacturing the larger inserts, representing a cost saving of $570,000. The company can now meet its customers’ short-term needs, increasing the likelihood of them providing Letters of Intent to use SunThru’s product, increasing the company’s chances of securing NSF Phase II funding. If successful, it will build SOMA5000, a device that can produce 15ft square aerogel inserts.
“Scale for Climate Tech and the MEIR program has provided crucial support to SunThru during a time where it traditionally would have been difficult for a hard tech company to bridge the gap between feasibility and scale up,” said John Costa, the company’s CEO.
Folia Materials: Turning paper into a supermaterial
Folia Materials is a materials science company that has developed a low-cost, highly effective antimicrobial finish for paper and textile materials to reduce plastic consumption. With its point-of-use water filters, antiviral face masks, and sustainable food packaging, the company is positively impacting the environment and public health. One of Folia Materials’ Fortune 500 pilot partner companies has called its food packaging “a game changer in the food packaging industry.”
With just a small team, Folia managed to manufacture industrial-scale rolls of coated paper for water filters and PPE by mid-2022. In September of that year, the company secured funding to manufacture pilots of two new products. The first was coated paper and industrially-made packaging for microwave food packaging with American multinational company. The second was coated paper for air filtration with the world’s largest tool company, for its nationwide sales pilot.
This presented the company with an opportunity for transformative growth, but it also presented a serious challenge. Folia’s small team would need to repeat industrial-scale manufacturing pilots and create prototypes before the end of 2022, which at the time was not feasible in terms of funding and capacity.
(Photo source: foliamaterials.com)
Reaching product and fundraising milestones with MEIR
By joining the MEIR program, Folia Materials could repeat manufacturing of all its products in just three months rather than delaying to raise sufficient funding.
The grant reduced the company’s downtime by 50%, lowered its material costs by 20-40%, and allowed it to add a full-time team member. It also enabled Folia to continue its product development efforts and attract further investment of $600,000 — a remarkable feat for an early-stage company.
“The Scale for ClimateTech program provided Folia Materials with the tools and resources we needed to streamline our design and manufacturing process and the freedom to address multiple use cases of our innovative technology,” said Teri Dankovich, the company’s co-founder and CTO. “Without the support of the Scale For ClimateTech program, we wouldn’t have been able to achieve product and fundraising milestones so quickly.”
For ClimateTech is an initiative administered by NextCorps and SecondMuse, supported by New York State Energy Research and Development Authority (NYSERDA).