Title: Pitchbook US template
1N O V E M B E RÂ Â 2Â 0Â 0Â 8
S O L A R I G E N E A P L A T F O R M F O
R B I O F U E L S A N D C O M M O D I T I E
S
Inventing Breakthrough and Commercializing
Science Harvard Business School Team Autumn
Klein Phillie Silverman Ali Wasti
Silver Labs, Department of Systems Biology
Harvard Medical School
SÂ TÂ RÂ IÂ CÂ TÂ LÂ YÂ Â PÂ RÂ IÂ VÂ AÂ TÂ EÂ Â AÂ NÂ DÂ
 C O N F I D E N T I A L
2Executive Summary
Intellectual Property
Market Opportunity
Competitive Landscape
Recommendation
Backup Slides
3Executive Summary
Photosynthetic Cyanobacteria
CYANOBACTERIA Photosynthetic AND genetically
modifiable
High Quantity Outputs
Few Inputs
Sunlight
CO2
CO2 Fixing Process
4Intellectual Property
Current Patent Status
No Existing IP on Cyanobacteria making Palm Oil
or Biodiesel
Genetic Engineering of Algae/Microbes other than
Cyanobacteria
- Genetic Engineering of Cyanobacteria
- Pathways to manufacture Isoprene, Biodiesel,
Ethanol - Large Scale Production
- Patent applications to manufacture large
quantities of Isoprene and Biodiesel
No Existing IP on large scale Cyanobacteria
production from Photosynthesis
Exiting Patents to Cyanobacteria producing
Ethanol and Isoprene, BUT different pathways and
small scale
5Market Opportunity Biofuels
Large, growing, addressable market
- Higher costs of gasoline versus ethanol are
driving market demand for biofuels - Corn ethanol producers suffer from feedstock
pricing volatility, food versus fuel debate - Alternatively, Cyanobacteria based Solarigene
- Does not need feedstock
- Has potential to produce more lipids (plant
oils) per acre than other terrestrial plants --
potentially 10X to 50X - Has been engineered to directly product
biodiesel, ethanol or lipids - Cultivate on marginal, non-arable land and use
non-potable water - Reduces worlds carbon footprint by sequestering
CO2
Higher costs of gasoline versus ethanol are
driving market demand for biofuels
6Comparison of biofuel yields from different
feedstock
Obstacles with Exiting Technology
- Todays biofuel producers face increasing margin
pressures and sustainability concerns around
feedstock - Corn ethanol producers suffer from significant
feedstock pricing volatility and scrutiny from
the food versus fuel debate - Traditional biofuel production facilities have a
much lower yield. Corn ethanol biorefineries and
soy biodeisel refineries require layers and
iterations of separation processes to arrive at a
marketable energy source. Solarigene entails a
direct path to manufacturing without the waste
produced in traditional biofuel production.
Source NREL
Solarigene Solutions
- Cyanobacteria have potential to produce more
lipids (plant oils) per acre than other
terrestrial plants -- potentially 10X to 50X - Lipids are the preferred starting point to make
diesel or jet fuel - Cyanobacteria cultivation can utilize
- Marginal, non-arable land
- Non-potable water
- Large waste CO2 vent resources (e.g. flue gases
from coal electricity plants) - Minimal competition with food, feed, or fiber
7Commercial Viability
Market Assessment for Commodities
- Analyzing historical and forward prices, and
yields and extractability of various commodity
products, our team has selected Palm Oil as an
alternate commodity to develop using the platform - Customers will include dependent manufacturers
of food, chemicals as well as palm oil based
biofuel producers and suppliers - Future development may include developing
products for companies exposed to commodity risk
Selecting Commodities
Source Silver Labs . 1YIELDS of product aim to
be 40-60 g/m2 per day 50 of Cyanobacteria is
lipid (membrane)
8Industry landscape
- No direct competitor in the photosynthetic
Cyanobacteria space
Competing Technologies
Solarigene Proposition
- Superior production economics with product
diversification and flexible technology. - Mitigates commodity risk and single product
dependence. - Avoids reliance on quality of feedstock
composition for yield and value - Separation, purification and conversion
technologies down the value chain. - Genetic manipulation for increased product
portfolio, efficiency and yield potential in
less than ideal conditions. - Profit maximization by targeting and optimizing
for higher value commodities and bi-products. - Monetization through partnerships with existing
commercial biorefineries, suppliers, purification
platforms and separation platforms. - Ability to address the need for high value
compounds from advanced bacteria.
- Competitors are small scale engineering firms
- No winner in quest for high yield and scalable
biofuels - Small, fragmented and specialized firms
- Natural Algae Engineered
microbes - Engineered Algae Traditional biofuels
Competitors have limited flexibility in product
proliferation and feedstock Exposed to
cyclicality risk of single commodity
9Solarigene solution and differentiation
Flexible platform
Yield
- Solarigene has the capability to manipulate the
cyanobacteria to produce maximum yields, beyond
the limits of competitive algae technology. - In order to achieve high levels of conversion
from sunlight in to biomass, feasibility relies
on the ability of Solarigene to engineer highly
productive bacteria. - However, even with aggressive assumptions about
Solarigenes productivity, estimated costs to
produce biodeisel are twice that of current
petroleum deisel fuel costs - Resource availability remains a hurdle to scale.
While cyanobacteria uses much less land and water
than traditional corn and oilseed crops and
produces a higher yield of biodiesel, surface
area to maximize exposure to sunlight is a going
concern. - Since sunlight can only penetrate to limited
depths, harvesting the cyanobacteria in storage
vessels with maximum surface area is imperative
to achieving yields.
Pharmaceuticals
Nutraceuticals
Rubber
Conversion Platform
Glycerin
Scalability
Biodiesel
Product Value (/ton)
Purification Platform
Food grade oil
Ethanol
Separation Platform
Fuel
Corn
Oilseeds
Algae
Cyanobacteria
Feedstock Productivity (ton/acre) Yield
Scalability
Photobioreactors Or Open Ponds
10Business Plan Options and Recommendation
- Offer Technology Licenses
- Extend licenses based on different applications
to industrial manufacturers, commodity
distributors, energy producers - Benefits
- Lowest Capital Expenditure
- Considerations
- Do not have sufficient target companies in the
space - Limited return
- Start a Company
- Recruit leadership and scientific team
- Benefits
- Build on existing research to focus on scale and
development of high yield cyanobacteria - Considerations
- Need to raise capital in tough economic
environment
- Fold Technology into an Existing Corporation
- Partner technology in return for equity
participation and governance rights - Benefits
- In house RD funding, resources, expertise
- Considerations
- Relinquish control and direction
11Executive Summary
Intellectual Property
Market Opportunity
Competitive Landscape
Recommendation
Backup Slides
12Commercialization options with funding
Use of proceeds
Business/Commercial Options
- License out the technology to others
- No current market for CB technology
- Invest 140mm to start small scale company using
milestones for staged investment - Spin off the lab/IP to existing competitor or
strategic buyer
- Commercially established cyanobacteria production
and processing facility - Integrated separations, purification and
conversion technology platform - Prototype for purification and conversion
platforms - Large-scale cultivation pond and management
facility - Marketing to off-taker relationships and
networking with renewable fuel producers/suppliers
- Brokering alternative fuels
- Negotiated contracts and partnerships with
chemical, agriculture and pharma companies
140mm to build mainstream infrastructure,
cultivation facility, extraction and purification
systems and distribution terminal
13Production possibilities
Feasible production universe
- By means of photosynthesis, cyanobacteria can
produce 3 main components - Carbohydrates
- Protein
- Natural oils/lipids
- Commercializing these possibilities include
- Vitamins/ pharmaceuticals
- Methane gas/ ethanol
- Rubber
- Cocoa butter/ palm oil
- Glucose
- Food grade oil
- Glycerin
- Nutraceuticals
Production of bi-products driven by demand
specific to customer
Due to Solarigenes flexibility, production of
bi-products can be rotated in order to hedge
exposure against the commodity cycle.
14Harvesting and Extraction
Harvesting
- Centrifugation (Spinning and separating)
- Frothing (Aeration to froth, then separate out
algae) - Ultrasound (In development)
Extraction (fats/lipids/oils)
- Mechanical crushing /- Other extraction
procedures - Chemical solvents (Benzene, ether hexane)
- Enzymes (Degrade cell membrane, release product)
- Expression (Dried and pressed)
- Osmotic Shock (Lyse cells)
- Supercritical fluid (CO2 liquifies and extracts
oil) - Ultrasound (shock waves break open cell membranes)
15Biological mechanics
Cyanobacteria
- Bacteria that are capable of photosynthesis
- Use sunlight to make product (algae and plants)
- Require only sunlight, CO2, water, and minerals
to grow and reproduce - Make sugars, protein, as well as fats, lipids and
oils - Genetically engineered to make large quantities
of a product - Products like Hydrogen, biodeisel, glucose,
rubber - Solarigene scientists and researchers are
genetically engineering CB to make these end
products. - Fix carbon dioxide (CO2)
16Biological mechanics contd
Photosynthesis
- Photosynthesis makes the energy from sunlight
usable in other organic forms to sustain life.
Using a small amount of minerals, sunlight and a
carbon waste (CO2), Cyanobacteria can convert
these inputs into high density forms of energy in
liquid or gaseous forms. (Hydrogen, biodeisel,
glucose, rubber) - Cyanobacteria fixes sunlight and CO2 in order to
produce biomass and other naturally occurring
commodities with much more efficiency than algae
due to their simple cell structure and ability to
be altered to thrive in any environment or less
than ideal conditions - Because of cyanobacteria's ability to be
genetically manipulated, Solarigene has the
flexibility to produce a variety of different
commodities.
Cyanobacteria
- Special bacterial species are altered genetically
to focus on production of one commodity, such as
biodiesel, ethanol or rubber - Cyanobacteria are the most economically viable
due to their diversification capabilities in
by-products and highly efficient productivity - Through genetic manipulation, the metabolic
pathways of the cyanobacteria are altered to
produced the desired commodity in variable growth
conditions - By-products are stored in the lipid membrane and
extracted through an organic process involving
numerous ethanol distillations
17Commodity Assessment historical pricing
Rubber Prices
Palm Oil Prices
Sugar Prices
Natural Gas Prices
18Commodity Assessment future demand projections
Rubber (/metric ton)
Palm Oil (/metric ton)
Natural Gas (Henry Hub- NYMEX)
Sugar (/metric ton)
19Land use for aquatic biofuels
AMOP aquatic microbial oxygenic photoautotrophs
20Biofuels market details Spread between Ethanol
and Biodiesel
21Interviews
- Eyal Gutentag, PrimaFuel
- Rye Barcott, Amyris
- George Church, Founder, LS9, Founder, Codon
Devices - Tod Perry, Technology Commercialization, National
Renewable Energy Laboratory - George Church, Professor of Genetics, Harvard
Medical School - Michal Preminger, Harvard Office of Technology
Development - Pamela Silver, Director, Silver Labs
- David Savage, Silver Labs
- Jeff Way, Silver Labs
- William Coleman, Partner, Mohr Davidow Ventures
- David Silverman, Aragon Partners
- Rob Koltun, RNK Capital
Industry
Technology
Investors