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Cellulosic sugar producer Sweetwater Energy closes $9M Series A round
29 July 2012
Cellulosic sugar manufacturer Sweetwater Energy, Inc. has oversubscribed and closed its Series A funding round. The company sought $5 million in initial funding, but investor response was greater than expected, leading CEO Arunas Chesonis to close the round at $9 million.
Sweetwater Energy uses a novel technology to produce low-cost sugars from non-food plant materials. The company plans to sell its sugar solutions to refineries, which use it to produce biofuels, biochemicals, and bioplastics.
Initially launched in 2006 under the name SweetWater Ethanol, LLC , the company originally was pursuing a decentralized business model to allow farmers to produce ethanol from crops right on their farms. The company refocused on producing sugar—which can be a key precursor for ethanol as well as for many types of other biofuels, biochemicals, and bioplastics—and changed its name to Sweetwater Energy.
In the spring of 2011, Sweetwater Energy’s team of scientists, led by Dr. Sarad Parekh, devised a way to increase significantly the efficiency of the extraction and fermentability of extracted sugars from a variety of biomass types. The technology generates separate and concentrated individual streams of C5 and C6 sugars.
Sweetwater’s initial $1.2 million seed round closed in February, 2010, financed in large part by Chesonis and Jack Baron, Sweetwater’s President and Chief Operating Officer. That funding, along with grants from the New York State Energy Research and Development Authority and early revenues from Department of Defense research sales to produce jet fuel for the US military, allowed Sweetwater to develop its novel decentralized sugar platform technology. That technology and other recent advances in the Sweetwater laboratories are now being engineered into Sweetwater’s first commercial facilities.
Earlier this year, Sweetwater began operation of its pilot-scale cellulosic sugar processing facility in Rochester, NY. Sweetwater’s chemists and engineers are using the pilot system in conjunction with Sweetwater’s laboratory to test new ways to quickly optimize the extraction of useful sugars from a wide variety of plant materials. Sweetwater is currently constructing a demonstration-scale facility at the same location later this year, which will allow final vetting of the Sweetwater technology at commercial scale.
In April, Sweetwater and BioGasol ApS, a Danish biotechnology company, entered into a strategic partnership through which Sweetwater will use BioGasol’s pretreatment technology—Carbofrac—as part of its overall solution to maximize the amount of sugar that can be extracted from plant-based feedstocks.
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