A few years down the road, if you find your wine glasses coming out of the dishwasher spotless, you might have Missoula scientists to thank. And you might thank them if your car is immune to rust from road deicers while you’re at it.
Rivertop Renewables, a local company that produces chemicals such as detergents and corrosion inhibitors derived from natural plant sugars, announced this week it had raised $26 million in capital from several major investors, including Minnesota-based First Green Partners and international agricultural giant Cargill Inc., the largest private company in the U.S. in terms of revenue.
The money will allow the company to hire 20 more employees in the next year, doubling its workforce, and expand its facilities and production capacity.
The jobs will be in sales and marketing, business analysis, accounting, engineering and research and development.
“It takes a startup into commercialization,” Rivertop CEO Mike Knauf said of the money. “It’s not just seed money for us to develop things a little further. No, this is actually to get us into full commercialization. So a year from now, if everything goes right, we should be making and selling nearly a million pounds a month of product. Those are big numbers. With that proof of concept of the commercial viability of the company, then we can leverage that into more growth, more investment and more jobs in Missoula.”
The company was formed in 2008 from the research done by University of Montana scientist Donald Kiely. Now it is the anchor tenant at the Montana Technology Enterprise Center (MonTEC) on East Broadway, a UM business incubator.
Joe Fanguy, director of Technology Transfer at UM, said the money for Rivertop might well be the greatest success story ever for a company spun off from UM’s research.
“To have something advance to this stage, to have outside investors like the country’s largest private company Cargill, it’s a big deal,” he explained. “It’s one of the first times that we’ve had this size of story to tell. It’s a significant deal. It shows the return on investment on research and how that can impact our local economy.”
Every year, UM gets millions of dollars worth of competitive research grants, mainly from the federal government. Kiely was using money from the U.S. Department of Agriculture in the 1980s when he discovered a process that is economical and efficient to produce glucaric acid, which can serve as a replacement for phosphates.
“The university filed a patent family around that technology, and through Technology Transfer, the university licensed that technology to allowed a new company to be formed,” Fanguy explained. “That allowed them to go out and raise money to commercialize that technology. It allowed them to make a product that has an impact around the world. Institutions can transfer technology for the sake of new products and new companies.”
Fanguy said the jobs created by Rivertop will pay two to three times the average Montana wage.
“This serves as inspiration for other companies, and it allows Rivertop to give back as far as research collaboration and sponsoring graduate students,” he said. “It started in basic research, which resulted in a company, which resulted in commercialization.”
Rivertop has patented several of their products, and they have several more pending. They specialize in using a range of sugars and sugar alcohols to produce the corresponding “sugar acids,” which possess a range of properties and have potential uses in the oil and gas, building and infrastructure and agriculture industries.
The company initially plans to focus on developing their two main products: dishwasher detergent and corrosion inhibitors that can be used by road departments.
The company has its own replica “kitchen” inside its laboratories, where several dishwashers run throughout the day as scientists dial up different hard water settings to try to hit the perfect formula for a spotless dish.
Brian Furey, a research scientist at Rivertop, said that places like Phoenix have much harder water than Missoula, so the chemicals have to be adapted for certain areas. The company’s mission is to create an abundant and economical supply of novel, biodegradable and nontoxic chemicals and biological products derived from sugars.
“Rivertop’s technology opens new opportunities in the renewable carbon value-chain by unleashing a platform technology with broad applicability,” said Doug Cameron, co-president and director of First Green Partners, an investment firm that focuses on companies that develop methods of green energy production. “We’re seeing increased demand for bio-based chemicals amongst the major consumer products companies, and Rivertop is well-positioned to take advantage of this trend.”
Knauf said the company’s relationship with Cargill and First Green Partners began to take off about two years ago.
“The company is six years old, and basically lived its first four years or so off angel investors, friends and family, that type of investor,” he said. “It was about two years ago that the venture capitalist type of investor was contacted. It’s taken that long for us to get a large venture firm to lead the investment.”
Knauf said the company has an ambitious vision for the future.
“Five years from now we expect to be building our third or fourth plant and knocking on several hundred million dollars in revenues, which makes us a very significant chemical company,” he said. “There’s a lot of work to do, a lot of work. But that’s what we expect.”
For more information, visit rivertop.com.