Seaweed-based straw maker Loliware scaling up with new financing
A company that uses seaweed-derived pellets — on conventional plastics processing equipment — to make what it calls plastic-free single-use products such as straws and utensils just got another boost from a big venture capital platform.
Atlanta-based Engage selected Loliware LLC this month as one of eight companies in the 2023 class of its Enterprise Go-to-Market Program. Engage helps startups learn to integrate customer data, marketing and brand development to become competitive and connect with customers.
Engage is located at Georgia's technology business incubator, the Advanced Technology Development Center. Engage works with the Georgia Institute of Technology to connect startups with established companies and university researchers.
Some of Georgia's biggest businesses back Engage's efforts, including Home Depot, Coca-Cola Co., Goldman Sachs, Chick-fil-A, Delta Air Lines, Georgia-Pacific, Honeywell, Invesco and others.
Loliware has been fundraising since it appeared in 2011 on crowdfunding site Kickstarter, back in the days when co-founders Chelsea Briganti and Leigh Ann Tucker called their agar cups "bioedible." (Tucker is no longer with the firm.)
The company has since been through several iterations and product name changes, appeared on the TV show Shark Tank and received funding and accolades from numerous green and venture capital sources including the Clinton Global Initiative and now Engage.
In January, Loliware said it had raised $6 million in a recent round of pre-series A funding, bringing its total to $15.4 million.
Loliware said its pellets are made of a proprietary blend of sustainably farmed seaweeds, minerals and natural colors. The material isn't a conventional bioplastic like polylactic acid or polyhydroxyalkanoate. The company claims it degrades in about the same amount of time as a banana peel, which can take anywhere from two months, if composted, to two years.
"We started with edible cups made with red algae, fruit extracts and vegetable colorant," Berlin said. "We now blend various species of seaweed together to achieve the desired physical and mechanical properties for our resins and finished products."
Plastics processor Sinclair & Rush Inc. of Arnold, Mo., makes Loliware's seaweed straws on its existing extruders, using what it calls 100 percent plastic-free pellets. Loliware said S&R is producing 100 million straws per year
Sinclair & Rush, a unit of Sinclair & Rush Ltd. of Kent, England, also does thermoforming, injection molding and dip molding. The company makes tubes and other protective packaging. Its business units include VisiPak, StockCap, GripWorks and Indepak.
"Many of our corporate partners are eager to collaborate with Loliware … in building a globally transformational sustainability company," Engage partner Bill Nussey said in a news release.
Because the material works on existing plastics processing machines, production is "instantly scalable, depending on how much need there is," Doug Richard, communications specialist with The Future Reference, said May 4 by phone. "The infrastructure's already in place."
The Future Reference is a sustainability agency that provides advice and strategy. In addition to Loliware, its clients include BMW, Marriott hotels, Nike, and various federal and local government entities. It has offices in California and Washington, D.C.
Loliware is seeing demand for its product in Canada and the United Kingdom, he added, and is researching seaweed's use in other items. The company has 15 customers with 28 locations using its straws and expects this year to add 20 more clients "with hundreds of new locations" requiring hundreds of millions of straws, Debriana Berlin, managing director of The Future Reference, said via email.
Some current clients include 1 Hotels, described as an "eco-chic" luxury chain, Fordham University in New York and Invesco Ltd. in Atlanta. PM Hotels is coming on board this month with its 70 locations and 60,000 rooms, Berlin said. The company also will be announcing new customers at the National Restaurant Association Show, set for May 20-23 in Chicago, and it plans to unveil a line of utensils in London later this year.