Here is a useful “cheat sheet” courtesy of Lux Research on who the ultimate winners and losers could be.
The biofuels and biochemical industries are promising. Developing food-crop or cellulosic-based alternatives to petroleum-based fuels and chemicals could open the door to massive markets. But extracting both a green and a low-cost product at large volume is a scientific hurdle many are still trying to clear.
The result has been what might generously be described as an uneven track record in the public market. Some companies received initial welcomes, but the bloom has largely come off the rose.
Amyris, KiOR, Gevo, Codexis and Solazyme all remain below their IPO prices in this year’s volatile financial markets. A second wave of companies sits in registration, including Myriant, Luca Technologies, Genomatica, Ceres, Elevance Renewable Sciences, Fulcrum BioEnergy and Mascoma. It is hard to imagine investor demand will be a great deal different.
Backers of this second wave of companies include Kleiner Perkins Caufield & Byers, VantagePoint Capital Partners, Khosla Ventures, Draper Fisher Jurvetson, Mohr Davidow Ventures and other firms. There is a lot at stake.
As Lux analysts Andrew Soare points out, biofuels is a market hitting puberty, with some companies reaching scale and other missing targets and laying off employees.
With this set up, here is Lux’s concise breakdown. PeHUB does not endorse the analysis, but considers it a useful addition to a complicated debate:
“Enzyme players Codexis and Novozymes are best positioned to dominate pretreatment. Pretreatment technologies – like enzymes, acid, and supercritical water – “unlock” sugars from lignocellulosic biomass, and are the key to unlocking long-term growth in the bio-based fuels industry. Enzymes are the approach of choice right now, though acid hydrolysis company HCl CleanTech offers opportunity. Unproven Proterro and Renmatix have technical promise but are kept in check by business reality.”
“Bioprocessing companies epitomize flexibility – a necessary trait in this industry. Using synthetic biology and other techniques, developers can design microorganisms to produce compounds chemically identical to petroleum-derived fuels. Amyris, Solazyme, and Gevo are the leaders in this segment…LanzaTech, Aemetis, and ZeaChem wait in the wings, and Qteros and Mascoma are losing ground.”
“Gasification, pyrolysis, and torrefaction produce few winners each. These alternative methods for converting waste or biomass into fuels are less populated, but each does offer a few strong players. In gasification, Enerkem and Agnion dominate, fueled by investments from Waste Management; Agilyx, BTG-BTL, and Ensyn are the dominant players in pyrolysis. Thermya uses torrefaction – preparing biomass and waste for pelleting and co-firing with coal – to earn similarly high marks.”
Here is a link to the Lux report.