RWDC Industries, a Singapore-based company that produces biodegradable plastic, has raised US$133 million to ramp up production and research and development (R&D).
The two-stage Series B funding round was co-led by venture capital (VC) firm Vickers Venture Partners, US-based energy and resources firm Flint Hills Resources, Swiss pension fund CPV/CAP Pensionskasse Coop, and Luxembourg-based alternative investment fund International SA.
Other participants in the round included existing investors Eversource Retirement Plan Master Trust, the pension fund of Fortune 500 company Eversource Energy, and WI Harper Group, a pioneer of US-Asia crossborder VC investing.
Some investors in the round are limited partners of Vickers’ fund. Vickers previously led RWDC's US$22 million Series A3 round, together with Eversource Retirement Plan Master Trust.
RWDC was founded in 2015 with the aim of replacing single-use plastics with cost-effective biopolymer material solutions – particularly polyhydroxyalkanoate (PHA). The startup’s PHA is certified by agency TÜV Austria to be fully biodegradable within weeks in soil, water and marine conditions. It leaves no toxic residue. PHA can be used in consumer goods such as straws, utensils, cups, plates and lids.
Co-founder and chief executive Daniel Carraway specialises in biopolymer development and commercialisation, having invented and commercialised more than a dozen new bio-based polymers.
Executive chairman Roland Wee, who co-founded RWDC with him, is an engineer who has worked with companies such as DuPont and Procter & Gamble. Mr Wee also founded MEI Project Engineers in 1973, which provides engineering, procurement and construction services for a variety of projects in Asia. A team at MEI has since moved over to RWDC to work on solutions to eliminate single-use plastics.
Mr Wee told The Business Times: "I've been in business for 47 years, and I've never seen anything like this. That's why I brought my whole team in, to dedicate them to this business alone. We were doing big plants and big contracts in China, but we dumped all those things to focus on this."
Some suppliers and sub-contractors that RWDC works with are long-time partners, he said.
The fresh funds raised by RWDC will go towards setting up a 4,000-tonne production facility in Athens, Georgia, in the US. The site will support the initial product launches of the first set of clients, who are likely to launch products that incorporate RWDC’s materials later this year.
RWDC is repurposing an idled factory originally constructed in the late 1960s for its new facility, which is expected to create 200 jobs. The startup currently has an R&D facility on the campus of the University of Georgia, which can produce a few hundred tonnes of the material a year to support its clients' validation trials.
The firm will start construction of a commercial-scale plant with a production capacity of 25,000 tonnes in the second half of this year, to be based in Athens, Georgia.
Mr Wee said the company has about a dozen contracts in the pipeline, and at least six "very big clients" in industries such as food packaging and quick-serve F&B.
While the Covid-19 pandemic and the resultant lockdowns have hit its clients, validation trials are still ongoing.
As the RWDC scales up production, plans are underway to build a team in Singapore that will serve the Asian market. Mr Wee suggested that the demand in South-east Asia might even surpass that of the US because of the region’s heavy use of plastic products.
The startup has about 70 staff in the US in R&D and marketing. A team of 10 in Singapore is responsible for administrative work, finance and fund-raising. The headcount in Singapore will be expanded by a few dozen more to support the development of plants; hundreds of employees will be needed to operate these facilities across Asia.