Why we investedin Material evolution
The decarbonisation of building materials is a critical puzzle piece on the path towards a net zero-carbon economy. Two of the most used building materials — cement and steel — contribute 15% of global CO2 emissions between them. The cement industry produces approximately 4.5 billion tons of cement each year, which equates to around 4 billion tons of CO2 or 8% of global CO2 emissions. If the cement industry were a country, it would be the third largest emitter of CO2 behind China and the US. And yet, cement remains the most widely used building material and sustains a very profitable industry that so far is not really being held to account for its dismal environmental record. Cement producers still enjoy generous exemptions from the European Emissions Trading Scheme, and while industry leaders acknowledge the problem, they continue to adhere to established production methods which are highly energy intensive but deliver healthy profits. If there is an industry deserving to be disrupted, this is it.
Enter Material Evolution. Based in Middlesborough in the UK, the company has developed a revolutionary one-part geopolymer cement with a CO2 footprint that is 85% lower than ordinary Portland Cement (OPC), while delivering superior performance. Geopolymer cement is a relatively new development. It relies on minimally processed natural materials or industrial byproducts instead of clinker and thus significantly reduces the carbon footprint of cement production, while also being highly resistant to many common concrete durability issues. The company’s innovative one-part system means concrete can be produced by simply mixing water with cement. There is no need for additional chemical activators. The product can be tailored to customer specifications using a proprietary algorithm that manages the formulation and complex interplay of the different ingredients during the activation process to achieve consistent outcomes even as input materials from different waste streams are used. These capabilities serve as a strong competitive moat and allow Material Evolution to continuously develop new products including a carbon-negative cement made from industrial by-products that sequesters carbon over its lifetime, and a screed made from >90% waste.
Material Evolution’s product range has experienced strong market pull and the company is now focusing on rapidly increasing its production capacity. In doing so, Material Evolution will also play an important part in the regeneration of the Teesside urban area, a region with a long tradition in iron and steel production which following its post-industrial decline now counts among the most deprived areas in England.
Elizabeth Gilligan’s grit and determination as an entrepreneur, the company’s unique product development capabilities and strong competitive moat, the large addressable market combined with an industry ripe for disruption, and the opportunity to dramatically reduce the carbon footprint of one of the most ubiquitous building materials made Material Evolution an obvious investment for KOMPAS VC. We are beyond excited to lead the company’s Series A and work with Liz and her team to build a global leader in sustainable building materials. We are also very happy to team up with strong partners including Norrsken VC and CircleRock Capital to support Material Evolution during the scale-up phase. The climate crisis creates real urgency to decarbonise the building industry, and we are proud of our role to fund future industry leaders who deliver the change we need to combat climate change.
— by Sebastian Peck, Partner | KOMPAS VC
