Addressing two global environmental challenges – a surplus of carbon dioxide (CO2) and a deficit of clean water – is at the heart of technology being developed by a pair of Lower Mainland companies.
Surrey’s Mantra Energy Alternatives Ltd. has produced an alternative to carbon sequestering by using an electro-chemical process that turns carbon dioxide into formic acid, which has commercial and industrial applications.
Meanwhile, Abbotsford-based Aquavive Technologies has developed a system that the company says could address water shortages in arid nations and clean up polluted effluent from industry and sewage treatment using a method that’s cheaper than other purification processes.
But as the companies’ founders have discovered, even great innovations don’t get far without capital. The bones of great ideas litter what clean-tech investment consultant Dallas Kachan called “the valley of death between great idea and widespread market acceptance.”
Taking companies like Aquavive and Mantra to the next level was the idea behind the April 5 Northern Cleantech Showcase. Aquavive, Mantra and five other Lower Mainland clean-tech companies were selected to attend the boot camp.
Co-sponsored by Gowlings law firm and Deloitte, the Vancouver workshop gave the seven companies’ executives a crash course in wooing angel investors. On April 14, they headed to Silicon Valley to make 10-minute pitches to venture capitalists.
“Canada has no lack of innovation,” said Kachan, a 13-year veteran of Silicon Valley who led the boot camp. “There’s a wonderful entrepreneurial, scientific, research-and-development culture in Canada. What Canada lacks is large sums of investment capital and connections to large multinational corporations.”
The companies returned to B.C. last week. Kachan said he was pleased with the reception they received from 25 institutional investors in Silicon Valley.
“There were a lot of business cards exchanged. Every one of our companies left there with a lot of really good leads.”
Realistically, he said it might take three to six months before the participants learn if the investors are willing to put money into their companies.
Meanwhile, Peter Yew, CEO of Aquavive Technologies, said his company has already raised the initial investment needed to develop its technology – about $4 million. But he added that getting to market will require another $7.5 million.
“We have developed the science, but we do not have a proper commercial process yet.”
Aquavive uses a highly charged absorbent particle that, when put in water, attracts suspended and dissolved solids. The process promotes water purification without the expensive membrane systems used in reverse osmosis. Yew said its main applications are desalination and toxic effluent decontamination.
Like Aquavive, Mantra raised an initial $3.5 million for research and development locally through equity financing. Larry Kristof, Mantra’s founder and CEO, said the company now needs $4.5 million to finance a demonstration project in partnership with Lafarge Canada and Kemira, a Finnish chemical company.
Mantra will tap the gases coming from the Lafarge cement plant in Richmond – 14% of which is CO2 – and turn it into formate (formic acid), which has a range of commercial and industrial uses. Kristof said that one environmental bonus is that the process replaces the petrochemicals that are usually used to create formate.
But Ross McKitrick, a Guelph University economist who specializes in environmental economics, said companies like Mantra could face an uphill battle in the U.S., where recent government decisions – and indecision – make carbon sequestering or recycling unappealing to industries that can buy carbon offsets more cheaply.
“I suspect they’re now about two years too late to get much venture capital interest.”
McKitrick added that had the U.S. implemented a cap-and-trade scheme, there would have been demand from U.S. industries and power producers to reduce CO2 emissions through carbon abatement processes like sequestering.
“The companies that are trying to sell actual emission abatement technologies are going to be competing against offset credits,” McKitrick said, “and offset credits tend to be pretty cheap, at this point.”