Genecis BioIndustries

Genecis Bioindustries Inc. ○

Offering Description

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Genecis is an innovative cleantech company that recycles organic food waste into high-value biodegradable PHA (polyhydroxyalkanoate) plastics. Both organic waste management companies and traditional petroleum plastic producers are facing increasingly tough regulatory and economical challenges. Genecis’s technology is an environmentally and economically greener alternative to current organic waste recycling methods, and outputs products that are seven times more valuable within a third of the time.

Genecis' mission is to “up-cycle the waste of today into the platinum of tomorrow”.

Investment Highlights

Investment Overview:

Genecis Bioindustries is offering a security structured as $1.5M, with up to $2M allowable, in Class A Common Shares in Genecis, which will represent fully diluted 25% ownership in the corporation post-investment based on the maximum raise of $2M. This investment is eligible for accredited investors only. 

Use of Proceeds:

Genecis will use approximately $1.5 million of funds raised to finance the design and construction of a small pilot facility next year, with capacity for processing 150 tons of organic waste per year. 

Product Description

Organic Waste Collection and PHA Bioplastics Production:

Genecis is an early-stage organic waste processing company that turns food waste into biodegradable plastic pellets. Genecis will obtain organic waste from waste collection (or tipping) companies. Their process will then synthesize high-quality, 100% biodegradable PHA plastic pellets from the organic waste. These plastic pellets have comparable material properties to traditional petroleum-based plastics and have the added benefit of completely degrading in nature in 1 year.

SynBio Database and Platform:

In the future, Genecis plans to builds its own extensive database of bacterial DNA sequences. Once DNA is sequenced and analyzed, it will be stored in their database. Genecis is particularly interested in collecting a variety of bacteria that can produce chemicals of higher value. In parallel, Genecis will build software and hardware, namely the SynBio platform, which will be capable of creating more than 100 cultures of bacteria a day, which can then be used in production facilities or licensed to other chemical manufacturers, if they meet the necessary requirements. 

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Competitive Advantages

With the newly legislated landfill bans for organic waste, as well as their more environmentally sustainable and economically lucrative organic waste processing solution, Genecis is well-positioned to disrupt the currently established system of waste processing and management.

As compared to time-intensive processing cycle of most composting facilities, Genecis can produce PHAs in 7 days. Genecis also has a massive pricing advantage over these plants, as the end product of Genecis’ process is high-value PHA bioplastics as opposed to cheap fertilizer.

As compared to other plastics on the market, Genecis’ PHA plastics major advantage is that it can degrade in nature within a single year and in a composter within 4 to 8 weeks, thus making it truly biodegradable, while maintaining the same material characteristics as commonly used petroleum-based plastics. The closest biodegradable plastic alternative has a degrading period of 80 years. Other existing PHA bioplastic producers have extremely high costs. By attaining organic waste at a negative cost, Genecis avoids more than 40% of current commercial PHA production costs.

Further, Genceis is positioning itself for future success with the creation of their own bacterial database and platform, SynBio, which will eventually enable them to process organic waste into higher value chemicals and polymers.  

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Impact Narrative

B Impact Score : 103.2 

SDG:  #12 Responsible Consumption & Production; #13 Climate Action

Genecis’ offering is a social, environmental and economical method for not only disposing organic waste, but also up-cycling it into valuable biodegradable plastic products. Genecis will reduce GHG emissions in the following ways:

  1. Diversion of food waste from landfills
  2. Replacement of petroleum-derived plastics with bioplastics

Additionally, by creating a 100% biodegradable plastic that degrades in nature within a year, Genecis will be contributing to the reduction of plastic pollution as well as attempting to reduce the hazards that non-biodegradable plastics pose on wildlife, marine life and the entire food chain. 

Traction

Grants and Awards: 

  • Genecis has secured approximately $300,000 in grants and awards from various sources including Fierce Founders Pitch Competition (BDC, Deloitte), UofT Hatchery 1st place, Bioenterprise Seed, Onatrio Centres of Excellence - Voucher for Innovation and Productivity I, and others.
  • Luna Yu, CEO of Genecis, has been selected as one of six finalist award winners for the Women in Cleantech Challenge, which includes a $110K stipend per year as well as business and research support for the duration of the 30-month accelerator
  • Genecis is currently in the process of applying for a $2 million+ matching grant to support  commercialization from Sustainable Development Technology Canada

Partnerships: 

  • Genecis has secured a 2 year partnership with Sodexo, who will provide their processing plants with organic waste and purchase PHA plastics 
  • Genecis also has three other LOIs with plastic purchasers, organic waste suppliers and their organic waste processing demonstration plant 

Advisory Board Members

Business Advisors:

  • John Rothschild (Former Executive Vice Chairman - Cara Operations Ltd.)
  • Peter Halsall (Former CEO of Halsall Associates)
  • Greg Stewart (Principal at Green Sky Capital Inc.)
  • Christine Tovee (Former Chief Technology Officer of the Airbus Group, North America) 

Technical and Scientific Advisors:

  • Dr. Roberta Fulthorpe (Professor in Microbiology at the University of Toronto)
  • Sonnia Sennik (Current Executive Director at the Creative Destruction Lab)
  • Dr. Torsten Meyer (University of Toronto Biozone)
  • Dr. Elizabeth Edwards  (University of Toronto Biozone)
  • Richard Hill (North American Leader at Radici Group)
  • Truman Wu (Wastewater engineer at Xogen) 
  • Shane Harker (Former District Manager at Waste Management Inc.)
  • Paolo Macarrio (COO of the largest solar manufacturer in Canada – Silfab Solar)

Risks

All private securities listed through online investment platforms and Exempt Market Dealers (EMDs) like SVX are likely to carry more risk than those available on the public markets. Our goal is to make you aware of those risks before making an investment. For further details on the risks in the private markets, refer to the SVX Risks section. Some of the offering specific risks are identified below:

Liquidity Risk: This investment has substantial liquidity risk. As this is an early stage private equity investment in a pre-revenue, pre-commercial venture, there is no reasonably expected exit event in the near-term future.

Intellectual Property Risk: Genecis relies heavily on its IP for product success and protection. This is particularly crucial given Genecis uses bacteria for its growth multiplier.

Business Risk: As Genecis is a pre-revenue and pre-commercial biotech venture, with most of its performance to date related to R&D, there remains uncertainty in confidently estimating how Genecis will perform once out of pilot phase.

Market Adoption Risk: Genecis will not begin commercial sales of its PHA product until 2020. There is lower market adoption risk in its organic waste collection and PHA production revenue stream, as it has lined up multiple industry partners and LOIs.There remains significant R&D to bring its SynBio platform to market, as the business model, potential sales list, and software/hardware components have yet to be clearly identified.

Management Team

Luna Yu

Luna Yu

CEO

Luna Yu, the founder and CEO of Genecis, is an experienced founder and manager. She has previously founded and grown three startups. This includes a software company where she managed over 20 IT specialists. The other two companies were formed in partnership with professionals from both Canada and China. She holds an Honours Bachelor of Science and a Master of Environmental Science from the University of Toronto.

David  Zhou

David Zhou

Chief Business Officer

David has experience in sales, project management and accounting in firms including Rogers Communications and Sunlife Financial. David attained his Bachelors of Commerce, with specialization in Accounting from University of Ottawa. He is currently a final year MBA candidate at Rotman School of Commerce, UofT.

Vani  Sankar

Vani Sankar

Director of R&D

Dr. Sankar holds a PhD in Biotechnology from CSIR – National Institute for Interdisciplinary Sciences and Technology, India. She has extensive experience in Bioprocess development and optimization. She has more than 5 years of experience in biofuel production from lignocellulosic biomass. Vani has worked on several big research projects involving multiple international collaborations and has several peer reviewed publications to her credit, including 2 years of specialization in conversion of Jackfruit waste to PHA biodegradable plastics.

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*Capital raised figures include amounts raised both on and off platform. Amounts raised off platform or committed have not been independently verified by SVX.