Green Chemistry Ventures

Anieke Wierenga

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Green Chemistry Accelerator -Entrepreneurship in Transition

Tuesday 23 April 2024 – the graduation of the second cohort of the Green Chemistry Accelerator – an initiative of GCNE (Groene Chemie, Nieuwe Economie)

Green Chemistry attracts a-typical entrepreneurs. Those teams did not select a rapidly growing market segment to enter with a scalable business model to get rich fast. Rather, they opt to commercialise technological innovations that enable a transition to a fossil-free chemical industry. They passionately choose ’the difficult route’. 

Classic entrepreneurship classes and startup support programs fall short in preparing these startups and their investors for a successful adventure. But what is missing? How do you develop a solid support structure for startups that can contribute to the transition to a New Economy?

Green Chemistry startups do face at least three special innovation risks at once:

Technology Adoption :The full-scale commercial adoption of breakthrough technology within the chemical sector often takes decades

Fossil -free Transition: The adoption of alternative sources of energy and the use of non-virgin and bio-based materials is still at its infancy.

Circular Business Models: The adoption of non-virgin feedstock requires long-term risk-and-return commitments between various partners within (and around) the value chain

Initially, it may seem attractive to keep things simple and select a straightforward go-to-market strategy, and raise funds for a ‘classic’ scaling model: lab-pilot-demo-full commercial. Research by Gritd. shows that this strategy does not work for green chemistry ventures. To name a few reasons: (1)Venture Capital funds have little appetite for such capital-intense, slow returning investments, (2) the chemical industry is not ready for ‘Green Chemistry’ materials at scale and (3) regulations , for instance around ‘End-of-Waste’, make it difficult to commercialise available products.

Smart entrepreneurs therefore embrace the complexity and develop offerings and go-to-market strategies that fit the current state of the industry. But that alternative approach also  requires new skills. In the Green Chemistry Accelerator we experimented with a few:

1. Discovery Driven Approach: There is no map of a fossil-free circular chemical industry. Startups need to navigate their own route by taking small steps and keep track of progress along the way. In the GCA program we used the OKR methodology to make these steps explicit.

2. Ecosystem Innovation: The value of the technology of the startup can only come to life in co-innovation and co-creation with enabling partners. We worked with Prof. Murat Tarakci at Rotterdam School of Management to support the startup teams in mapping and developing their minimal viable partner network to enable initial sources of commercial income and alternative funding routes.

3. Business Model Transformation:  How to create value with technology in unfolding markets? We learnt that many startups in the program were able to generate commercial income streams through co-development projects and paid research. This initial business model may serve as a launch pad for subsequent models like technology licensing or product sales.

4. Partnerships and Alliances: In circular business models, but also in growth strategies that involve joint research and development programs, partnership and alliance building skills are essential. The GCA program actively supports the participating startups to build a solid IP strategy to enable robust and fair partnerships.

Now the program has come to an end, we can see that this new approach had a life-changing effect on the startups. The majority of participants drastically changed their go-to-market approach based on the new insights gathered. But we also identified gaps in our approach, which we aim to address with the third cohort.

Most venture programs for impact ventures still teach standard startup-methodology. It is time for a next generation of accelerators to fuel truly transformative innovation. 

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