[Posted on May 6, 2008 - 5:08 PM]
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DiggAs enthusiasm for corn ethanol wanes and demand for biofuel rises, cellulosic ethanol developer Mascoma Corp. said Tuesday it has raised $61 million from key strategic partners and previous investors. The company will use the funding to finish testing its technology before seeking alternative funding strategies to develop commercial production facilities.
Marathon Oil Corp. [MRO} led the round with a $10 million investment, joined by General Motors Corp. [GM] and previous investors General Catalyst Partners, Flagship Ventures, Kleiner Perkins Caufield & Byers, Khosla Ventures. VantagePoint Venture Partners and Atlas Venture.
The round brings total equity investment in the three-year-old company to more than $100 million, matching the amount Mascoma has landed in federal and state grants supporting its proprietary biotechnology processes for breaking down a variety of energy-intensive woody biomass and waste materials into low-cost ethanol.
Mascoma president Colin South said the new funding comes as the company prepares to launch its first demonstration facility in the next few months in Rome, N.Y. The company is also preparing to build larger scale research and production facilities in Michigan and Tennessee, supported largely by research partnerships with the U.S. Department of Energy and state agencies.
The company expects these facilities to prove that its technology is capable of scaling up to industrial capacities and increasing the amount of self-generated enzymes in the production process to reduce costs.
"The challenge in the industry has been the cost of processing, and the long-term effort and outcome of research would be to produce enzymes as the feedstock ferments," South said. "Initially, we won't be at that goal and will have to purchase enzymes, and that is not cost-effective." -- Clifford Carlsen
See May 6 press release from Mascoma
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