ComBio wants industrial players to use sustainable biomass instead of fossil fuels for heat generation. Check out the 9-slide pitch deck it used to raise $90 million in growth capital.
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- Brazilian company ComBio wants industrial players to swap out fossil fuel boilers for biomass.
- It just secured $90 million from UK-based VC firm Lightrock and Brazilian hedge fund SPX Capital.
- We got an exclusive look at the pitch deck it used to raise the growth capital.
A Brazilian biomass startup that helps mining and manufacturing companies ditch fossil fuels to generate heat just secured $90 million in a round co-led by London-based Lightrock, which seeks impact investments, and hedge fund SPX Capital.
Founded in 2008, ComBio has developed biomass-based systems to remove the need to use oil and gas when generating heat. The company sources biomass from agricultural and forestry waste, which it said is sustainable and would typically have no other use. Biomass is burned to boil water and ultimately create steam. The steam is used in an array of processes across the mining, manufacturing, and food and beverage industries, from creating paper to aluminium.
Renewables made up the bulk of Brazil’s energy mix in 2021, sitting at 84%, according to the US International Trade Administration. As a result, when industrial players measure their carbon footprint, “they realize that at least 70% of their emissions come from thermal,” said CEO Paulo Skaf Filho.
“Changing their boiler is how they get to net zero,” he added.
Biomass is considered carbon neutral because the carbon released when it is burned is the carbon that was absorbed during the plant or tree’s lifetime, making it part of the natural carbon cycle, or because the emissions have been counted elsewhere. Some critics, however, have argued that most woody biomass releases more emissions than coal and gas.
ComBio uses biomass solely for heat generation, not electricity. “Although both are energies, they’re not very well connected in terms of technologies,” Filho said.
Generating heat by solar is possible but requires completely different technology to energy generation, he added. Heat is not easily transported, meaning companies must have the space for vast solar panels on-site. This method is also still expensive, Filho said.
While heat pumps have boomed in popularity in recent years, Filho said they can’t serve the large industrial sites that ComBio does. ComBio is strategically using heat pumps to preheat its water.
“If you look at the energy transition on heat, on thermal, you have quite limited options and by far the best one is biomass,” Filho said.
ComBio uses waste streams and residues from agriculture, the wood industry, and others as a biomass source. For example, in the pulp industry, a tree’s roots and bark are typically discarded and sent to landfill, Filho said. Biomass like this is “abundant” in Brazil, he added.
“The wood industry is very similar to an agricultural industry in Brazil,” Filho said, noting how it centers around fast-growing trees that differ from those that take decades to grow in Europe.
The company also captures the ash left over from burning, which is used to produce compost or fertilizers. The company claims it has already avoided the emission of 2.26 million tons of CO2 through its customers swapping to this method. Filho has a 2025 goal to hit 2 million tons avoided annually.
Having bootstrapped operations for the past decade and a half, the growth capital will be used to scale up.
“We’re still tackling less than 1% of the market,” Filho said. “There are lots of boilers to be switched into biomass and lots of biomass being sent to landfill, so we have to do this matching.”
Check out the 9-slide pitch deck the company used to raise the funds below.