Energy Tech Startups

0:00 Transform your startup journey with the energy tech nexus. Connect with fellow founders, access critical resources, and be part of a community shaping the future of energy and carbon tech. Your

0:10 path to building a Thunderlizard starts here. Learn more at energytechnexascom. Welcome back to

0:16 the show. I'm excited to be

0:19 here with Zimri Hinshaw. Last time he was here, he was a founder and CEO of Bucabio. But wait, it's the same company. It's a real materials. The company has a mission to empower a sustainable

0:28 future by creating innovative, bio-based materials that seamlessly replace also fuel-based plastics. So Zimri, tell us a little bit about what you guys do and then we'll get into the rebrand 'cause

0:41 that is a fascinating exercise that every founder needs to go through. Yeah, most definitely. So yeah, we're real materials. We're creating bio-based alternatives to petrochemical plastics. But

0:52 here in Houston, we're using the exact same infrastructure, the same machines that plastics use to scale. create any factories or toll manufacture, everything out to create our materials. We have

1:04 two materials today. One is show rye, which is our bio-based leather alternatives. So think of like your interior of your car, your wallet, your handbag, your upper on your shoe, that kind of

1:16 thing. And then our second product that we're just coming out with is Benry, which is our 100 bio-based injection molded resin, which you can use for things like zippers I brought some sunglasses,

1:30 and they're a little too small for me, but - Like hard, like, that's the hard part. That's a hard part, so it's hard. It's a hard part. OK, exactly. Whereas show rise is more of a soft, and

1:39 it's more about the texture, I imagine. Exactly, the texture, the properties, how it holds up in a car, I think. And this is biodegradable. So the purpose of our materials, that what we're

1:53 designing them towards is that they can biodegrade at the end of life that, at least, hopefully. all the way, but at least partially biodegradable. But it's also biobased. So it's not even like

2:04 it's derived from like a fossil fuel, right? And Shurai is 93 biobased today and the goal was to get to 100. Benry is already at 100 biobased. And go ahead. Yeah, no, 'cause the problem you're

2:19 solving is like plastic waste, right? And one of the reasons why we wanna get away from plastic is one because it's produced from fossil fuels. And a lot of fossil fuel companies have actually been

2:28 lobbying to have us keep on using plastic and like, you know, Exxon recently was sued because they had been telling us that it's recyclable plastic when it's really not. Right. And like getting

2:40 all of, to put these recycling signs everywhere. Yeah. Or even when those plastics weren't recyclable. But then the second part is that you can't recycle, a lot of a plastic, or when you do

2:52 recycle it, it's hard and it's costly So talk to us about that part. two, I guess both of them. Yeah, I guess a lot of the petrochemical companies believe that that recycling is the end all be

3:09 all the final solution for plastics. And that what will make them sustainable, but you're absolutely right. They're hard to recycle, their energy intensive recycle, recycling is not perfect, a

3:21 very small percentage of the plastics that we use are recycled And if once they end up in the landfill, it takes what 500 plus years for them to biodegrade or finally degrade. Yeah. And I think

3:35 when we talk to corporate investors, like the number one thing on their list is to find a way to create like what they call like virgin material, right, to take that plastic and

3:47 make it as good as new. I think that's where the term comes from. So they know, like this is a big challenge. Technically, it's very energy intensive, of like you described, right?

3:58 How do we solve that using the bio-based pathway that you've developed? Yeah, absolutely. So the first and foremost, you can recycle some of our materials back into their own production if you

4:10 wanted to without a lot of degradation. But what we want to design towards is a more realistic end of life, right? A consumer is going to lose their sunglasses in the ocean, happens all the time.

4:23 Or they're going to throw away their items at the end of the use Their car is going to get crunched down. So those things are going to happen, end up in a landfill. What does that end of life look

4:33 like? How can these materials biodegrade, and then how do we certify that? So I think a lot of plastics don't have that. Some petrimo plastics can degrade, but vast majority don't. So first and

4:46 foremost, we focus on high-biobase content to get that carbon out of the production of the materials That's kind of our first and foremost focus, but then later. as well, the end of life and what

5:00 the biodegradation plan is for those biobased materials. So it's a more holistic approach and more holistic way of looking at materials than I think most petrochemical plastics do, which focus just

5:10 on cradle to gate or cradle to the customer. We're focusing on cradle to grave. Yeah, and I think importantly you said, we're using a lot of the same processes that already exist in the downstream

5:23 industry today, which the investor had in me says, oh, this means low capex, right? You don't have to go out and build your own factory. I think you said you put on a tolling arrangement. Did I

5:34 hear you say that first? Yeah, we just signed a big contract. Okay, good. And it's a toll manufacturer in Massachusetts to produce these materials at scale. So for someone who doesn't understand

5:44 how this part of the supply chain works, what does that mean and take us through the different players? So, I think first and foremost, like the strategy of it is that innovation happens you

5:57 change, you know, one thing. So what's like the, if you change like 10 things, that's a very complex company that's very hard to create. If you're building your own product, doing RD, also

6:08 designing and building a factory, you've got a higher a team that's 10 times as large and you have to have 10 times the amount of money. So for us, we needed to focus on what we're really, really

6:19 good at, which is creating custom biobased materials for specific applications and focusing on the technology, the research The proc development, what we're not good at is building a factory. We

6:30 didn't need to be good at that. So designing our materials from melt extrusion, which is how plastics are created, I'll walk you through the process.

6:41 That made a lot more sense to be able to scale something more effectively and achieve our mission, which is to replace petri-hemicals at scale. So how this process works and it will work at scale,

6:57 is that we design the formulation so what goes into the material how is it processed we have the processing conditions from these extruders we are going to send those materials to first a compound or

7:12 the compound or is going to take these different EQ and chemistry everything eventually looks like a even if it's a very exotic material it looks like a white powder or a clear liquid so I wish like

7:24 you that you could imagine them like grinding up leaves and feeding in leaves to an extruder but it's just all white powders and pellets and white liquids and so we ship those materials to a compound

7:35 or in their extruder they combine these under high heat high pressure and out of this machine comes pellets pellets of show rye pellets of battery and in the future pellets of bio fibers or whatever

7:50 else you want to create everything starts as a pellet those pellets are then sent up to a In this case of show rye, a sheet extruder, which is going to re-extrude those pellets into a shape, which

8:03 in this case is a sheet of material, which is then put a cotton backing on and sent to our customer. So that's the supply chain for show rye, for example. And so there's a partner you're working

8:16 with at a Massachusetts, which piece in the process are they the sheet extruder, sheet extruder, okay. And how does it work? Are they, are you paying them? Are they paying you for access to the

8:29 IP? Or does that relationship engage? Yeah, definitely. So we are paying them the toll manufacturer. Luckily, they're pretty flexible and they are letting us, they're investing. So they're

8:44 taking, letting us take 75 of the cost against a convertible note on our equity, which is amazing. So they're now an investor in the company. So it's a pretty flexible arrangement.

8:56 And then as we scale, as we hit profitability, as our margins go up, as we drive up volumes, we'll shift that and just pay in cash. And so what this allows you to do is, 'cause you're sitting on

9:08 all their capital equipment that they've already bought and built, and that they will use, I assume, 99 of the time for other customers. And so you get to jump on that fire investment without

9:18 having to build your own billion dollar factory. You know, they've guaranteed and said, with this contract that we have up to like, three million pounds of annual production capacity, which is

9:30 way more than we'll need in the near term, but hopefully in the mid-long term, we can hit those kind of volumes.

9:38 So in this particular example, then you are just providing that feedstock for them to create this kind of vegan letter type sheet.

9:52 And then are you concerned with like, where it, you know, selling this at, at the end, or is that something then? your customer takes care of. So,

10:00 yeah, it's a little bit of a combination actually. So, and we do the formulation. We send that formulation to them. We send the raw materials to them, the compounder and the sheet extruder. But

10:12 we also are giving them processing instructions. That's also part of our intellectual property is, how does this work in extruder? What the temperature is, how does it flow? This grew

10:22 configuration is, there's a lot of very technical extrusion related things that we have to include in that as well. So intellectual property kind of covers both of those things.

10:33 What was the second part of your question? How does it get to an end customer? Right, so absolutely we facilitate a lot of relationships with end customers. We work with European automotive

10:44 companies that we would then sheet extrude and sell directly to our customers. But as well, our sheet extruder, excuse me, our sheet

10:53 extruding partner also has a huge list of their own clients, and so they're interested in taking the formulation and purchasing volumes of it to resell to their own customers as well. So that's

11:06 another kind of perk of having that partner.

11:10 So you got a shoe here. I got a shoe. I got a lot of stuff. Do you want to talk us through like what is the show riot on the entire top there? Yes, the show riot is the top of this shoe. So the

11:22 upper, the back, the tag on the back, that's made out of an earlier version of show riot. As well, the handbag is also made out of a bigger version of show

11:36 riot. And so let's say we want a pair of Nike's would show right on it. I got in a little bit of trouble trying to do that

11:44 So they get this sheet, right? Like what does Nike like process it from there? Or does it have to go to another of other, I guess, partners to get prepped?

11:56 Yeah, so once the finished show right, which, you know, it can look like this, it's got a backing right now. It's got a cotton backing that can be done at the sheet extrusion site. So that'll

12:08 be done in Massachusetts. It'll be a finished product coming out of their facility in Massachusetts sent directly to the customer. So in your example, and I'm not making any claims, but Nike would

12:22 take that sheet to their factory, and they would then sew it and cut it into a shoe. Yeah. And I think Nike is famously kind of fabulous as well, where they are working with a lot of distributors

12:35 or a lot of manufacturing partners to assemble the shoes we have today. So it's like this big supply chain of pellets to peril, right? Yeah, definitely. I'm kind of set up in this way. And then

12:47 the point of sale for Benry is a little bit different In this case, we would sell. pellets. So we're not going to sell combs or guitar picks, even though that would be pretty cool. We're just

13:04 going to sell pellets. And these customers have their own injection molders, these molds that they work with. And because, you know, if you're Ray band sunglasses, you're going to have a Ray

13:17 band sunglass mold that's going to be the cast or the the shape exactly. So

13:24 we're going to sell

13:27 you the Ray band in this case, the pellets. And then they're going to have usually a toll OEM that works with them frequently. And but the point of sale would be to Ray band, they send it to their

13:40 OEM and get those sunglasses made. So a bit of a different point of sale And what is this really made out of? Like what what what are you using as your raw material? Yeah, absolutely. So.

13:57 We're starting with a base polymer in the case of Benry and Shoray, it's a fermented polymers. So it's a bacteria that's being fed sugar and then producing this bioplastic that has pretty good

14:14 properties and is biodegradable. Then we're modifying that with, 'cause we have a very specific industry grade, like the kind of Benry you have to make for a pair of eyewear is very different than

14:28 the Benry you have to create for a comb or for a zipper. They have different specs. Like any different strengths or elasticity or color. Exactly, all of the above. In the case of eyewear, we are

14:42 partnered and we're working with a company here in Texas and they said, Oh, we're gonna shoot the material. And I thought they said, like, Bap up I meant like, yeah, we're gonna shoot it in a

14:53 mold, like injection mold it. No, they meant like shoot it with like a rifle and a handgun. Yeah, they want to know how it shatters, right? Yeah, exactly. They shot the material said I didn't

15:02 pass ballistics try again. I said, okay So like in some cases like the requirement is ballistics resistance And so we might have like five different grades of venery for these very specific

15:15 Applications as well. Mm-hmm. And so when you're getting to that even is like just how long the chains are and and how they fail right just so We're taking these base polymers and we have to modify

15:29 them to hit those all those complex specifications so we're using things like minerals clays we use like Nut and seed oils derived in Greek additives to increase the flexibility cellulose to increase

15:49 the strength So that's like the plant fibers and the wood fibers and things like that And then on the end, we're thinking about color. And in the case of show-ride texture, but texture is a process

16:03 color is a pigment. Those pigments can come from things like algae and seaweed and also minerals. So those are some of the things that are going into these final materials.

16:16 And how are you keeping this cost competitive with the alternative? Yeah, so we're definitely going to be more expensive in petrochemicals for petrochemicals

16:28 I've had like 150 years to become as cheap as they are. And they're wildly complicated to engineer in that process to go on time. And let's not forget they're derivative of like the main thing they

16:40 want, which is jet fuel and gasoline, right? So they already got that kind of, I don't wanna call it a subsidy, but that's where the most of the value is unlocked. Yeah, totally. So we're

16:48 looking to replicate a lot of the properties without the environmental damage If you think about the cost of petrochemicals, it's actually a lot higher than you think if you include the environmental

16:58 damage, the space in landfills, and we're not taking that into account at the consumer, but we're certainly feeling that cost at a high to more holistic level. And if we can frame the relative

17:11 cost of plastic, so I'm just gonna put the water bottle in front of you. I feel guilty, yeah. If we say this is a dollar, right? The plastic value, for the fossil derived plastic, if you had

17:21 to swag it, what do you think it would be on this, versus if you had it with a Benry resin? Yeah, so when we're right now pricing Benry around1293,

17:33 it's a 100 biobase, that's cost-competitive with even semi-biobase nylons. And that's12 per ton pound, or? That's per kilogram. Oh, per kilogram, okay. Yep, and so those are at14, 15, so

17:47 we're already undercutting that petrochemicals for like a1 or they're like dirt, dirt cheap. we're looking to decrease that to like, you know, 9, 7, we're still gonna be a slight magnitude more

17:59 expensive. And so that's why our materials, which are designed for more durable products, and they have more ingredients in them, which of course is gonna drive up the cost slightly. You know,

18:12 that's why our solutions are better for more durable products, sunglasses, you know, zippers and things like that. It can have a little bit of more flexibility in the margins Like I don't think

18:23 our materials currently, maybe in the future, would be as good for packaging or this water bottle, but there are solutions for those. Even in the scheme of things, like you said, it was like14 a

18:36 kilogram, the plastic in this bottle is, I don't even think I can measure it in grams, right? Like it's, for an end customer, it's kind of incidental. If you use your material versus the

18:45 awesome material, we're talking about a few pennies on the dollar. Yeah, absolutely. Absolutely. when you talk about - When you do it across a lot of people - Huge volumes. Those pennies start

18:53 to add up, so. I did buy 200 bottles last week for an event, and it's, you know, even then it's, but it's a lot of volume in the schema things. I think if I knew you had the option to choose

19:05 the better plastic, like we would, I just don't know where to get it at. Well, you really can't - Which I can't, yeah. Today. Yeah. There are solutions coming for these kinds of more

19:16 disposable plastics, but for now, we're focused on the durable applications. When it comes to packaging, we're are interested in cosmetics cases and things like that. They're a little higher

19:27 margin. Over time, as the biobased industry scales, as our suppliers start to build bigger factories here in the US and closer to us, the cost of these materials is going to come down as

19:42 production increases, obviously, right? As we scale up with our toll manufacturing partners, we're also gonna get better pricing per. kilogram or per sheet on the materials as well. So there's a

19:55 few things that we can leverage economies of scale and the development and growth of the bio-based materials, chemicals, industry that will bring that price point down. Will it ever be price parity

20:09 with petrochemicals? I certainly hope so. We'll see. It might take a few years Then you can look at, like you're saying, where you start, instead of starting at plastic water bottles, you start

20:21 at cosmetics or where people have more willingness to pay more because people, like I buy, I don't want to say this, but I do buy a lot of cosmetics that I come

20:30 in plastic bottles or whatever you use that is part of your toiletries. It comes in a lot of plastic packaging and it's hard plastic.

20:40 We definitely need alternatives for that because we are already using a lot of money on these and if I have to pay10 extra, that's okay.

20:50 Absolutely. You're actually kind of our ideal and new super. Yeah, exactly. I mean, that's how Tesla started, right? I mean, it went into the luxury market first and then it scaled back into

21:04 making a car that's affordable for the general public. So we're doing something similar. We're not necessarily targeting the luxury market, but we are definitely targeting kind of that mid-market

21:15 brand that has a strong sustainability value Yeah, like an affordable luxury. There's probably a way to describe the target.

21:25 Cool, now that's fantastic to see how you're growing and evolved for the last hundred or 24 months since we've had you on. You have gone through kind of a brand change. I noticed you were very

21:39 careful in how you described where the source material is. Do you want to talk about kind of what the old name of the company was? Bucabao and how that has evolved? Yeah.

21:50 like the work you were doing changed as well, in terms of what you thought the core competencies of the business needed to be, and that evolved as you kind of got into market. So take us through

22:01 that journey and how they kind of interacted with each other. So way back when, back when we were starting out in New York City, the Upper East Side, that's when we came up with the name Butchia

22:12 Bio and or Book of Bio, it just really matter. That's fine. Yeah. We don't even, it's the old name anyway Yeah.

22:21 And it was because our primary ingredient at the time was kombucha, the drink. If you didn't know, kombucha grows a layer of thick cellulose, so this thick fiber structure at the top of the brew.

22:39 And we were using that and harvesting that and using that as a textile. So that's why we were a butchia bio, we would then modify it. That process changed to us grinding up

22:49 at cellulose and then putting it into the materials as like a batch process and mixing everything together with other polymers. And eventually we realized that we weren't a bio at microbiology

23:01 company that customers didn't really care where the material was grown or where it came from. They cared about the properties. Is

23:12 it bio-based? Does it biodegrade? Does it have excellent material properties? That's really what they were focused on Whether it was made from kombucha or from another polymer, they didn't really,

23:21 really care. So there was that, and it was going to be really expensive and difficult to scale growing kombucha in larger and larger volumes. We were already shifting away from that and more

23:35 towards formulation-based science. So when we chose to come to Houston, we had already made that shift in our head that we were going to find a new more scalable production reduce our materials and

23:49 then design the materials themselves backwards from that production method. Yeah. What I love about the story is, I think a lot of entrepreneurs go through this for you. You have a science, you

24:03 have a technology that's interesting, but as you peel away the layers of the onion, you realize, oh, customers care about performance, but it's not the performance I thought it was. It's this

24:11 other very rigorous set of metrics. We got to design the business around that. That's okay, because you're the expert in how to make plastics that are biodegradable now, both in terms of the

24:23 science, but also just how to get it to market. That's not obvious when you first start. It's okay to also let go of

24:37 the old name and the old concept because you're embracing the new direction of the company, the new competency. Tell us how does that lead you to real. Are you ready? to lead the decarbonization

24:48 charge. Energy Technexes is your platform for growth, offering unique resources and expertise for energy

24:57 and carbon tech founders. Join us at energytechnexescom and start building your Thunderlisset. Yeah, so we were probably a little overdue. We probably should have done it right when we got to

25:07 Houston and just like started new city new name. We held onto it for like another year or two years or so. But eventually we made that shift And it was absolutely because our technology was no

25:19 longer kombucha derived. But we also wanted to reflect that the company was releasing molar products, that the scope of the company had expanded. We had just released Benry. We were now a

25:33 multi-product company. That investors, when they invested in us, we're investing in the current products, but also future products. And so we wanted the name to reflect that. I led our technical

25:45 team, pick our name, ended up happening. They chose the combination of rheology, which is how polymers flow and form. So rheology and form become rheome and rheome materials. So that's how the

26:02 name came together, went with it, rebranded, and I think it definitely reflects a multi-product company, a more complex technology platform, and the growth that we've experienced since. It

26:17 almost sounds like an element on the periodic table with like RH, but that already is a sign. I don't know which one that one is. Rheobidium, rheome, rheome, rheome, rheome. But here's

26:34 the, I guess, million-dollar question. Are technical teams good marketing teams?

26:40 Don't worry we also screened it by a while but the marketing is you're selling to a very technical audience and so it it I assume they appreciate the wordplay Yeah Yeah Yeah and I think you know at

26:54 the end of the day that the wordplay is nice but does it does the name itself have that it factor does it sound good does it sound substantive and I think realm does sound it's nice it's substantive

27:09 it feels like it stands for something it feels like a technical company it feels like a science so talk to US about you know you talked about the journey of the product and how that's expanding and

27:20 evolving the material and the process itself but also what you're learning from like going out and talking to customers selling the product getting investors on Board yet because I'm sure you know and

27:31 there are lots of competitors that are maybe at the same stage as you 'Cause a lot of people are trying to solve this problem. So what differentiates you? What are you learning that you need to work

27:41 on that's important for our customers and also investors? Yeah, that's a great question. So we think that one of the biggest things that would differentiate us is our ability to scale. The fact

27:55 that we don't need to build factories, the fact that we can slot into existing plastics manufacturing. And the second is that our materials are very customizable We're able to modify them very,

28:07 very easily to meet new applications. And the sustainability proposition is very good. With Benrie, our closest competitors, when semi-biobased nylon are 45, 50 biobased, we're already at 100.

28:24 For show rye, the vast majority of competitors who

28:31 are in this space

28:33 are combining often plant cellulose Like Banana leaves or pineapple fibers or cactus fibers with in a P E P U petrochemical plastic and so your bio base can really only be up to like sixty seventy

28:49 percent before you start to lose material properties for us we're already at ninety three we have a clear pathway to one hundred and and then the competitors that are at that hundred mark are having

29:03 difficulty scaling and building factories they're having to build custom factories for every custom product and production method so I think that those things are really differentiating us and of

29:14 course are are great smiles and excellent customer service so so from it I Guess proprietary standpoint is this and this no how is that something that is derived internally or is that based more on

29:29 the way you just decide to design the products i guess it's all intellectual property but where where does it live within realm

29:36 Yeah so

29:39 there is the formulations themselves and and the applications that they're serving then there's also the processing conditions of the extrude of the extruder which is is not a simple process that is

29:52 intellectual property that's something that we do file on and and it covers the temperature the speed the configuration of the screw the die that and we send pages and pages of of of directions and

30:08 explanations of how to run these machines better to our our toll manufacturing partners so it's really that combination of like yes there's the formulation about the process that is girl know how

30:20 absolutely both of those things together form our intellectual property patent strategy our our lawyers are in in Chicago and and they're extremely impressive we're right now filing a lied were kind

30:34 of monitoring the space and filing any white space that there is to make sure that we have plenty of freedom to operate and also are a good acquisition target in the future. I went by your factory or

30:47 facility, I should say, in East End Maker Hub. Yeah. This is like a year ago, and I remember you just set up the lab. Yep. It looked fabulous. Thank you. And you had this machine where you

30:55 were testing the durability of

30:58 the show ride. And I assume that was to address some key concerns from customers who had looked at these products before So tell us a little bit about what that test was, what was it verifying,

31:10 what it did for you. So when you came in a year ago, 'cause we have more capabilities today, so I'm trying to remember. There's literally this machine that was just stretching the material. I

31:20 know exactly. I know exactly. It was familiar with something. Yes, that's called the Bally Flex Test. Okay. Yes. And it simulates the toe box of your shoe. But it's also kind of a.

31:34 a step in or a stand in to understand the durability of a material. How many times can it be deformed before it breaks down? So it's also a great test that we usually perform for our partners in

31:48 automotive, for testing the seat. 'Cause every time you sit down in a seat, you're deforming it, every time you stand up, you're coming back and slipping back into this original shape, that's a

31:59 similar test. So in that case, we were testing for automotive and they want, you know, 100, 000 cycles and we're looking to be able to improve that metric and meet their standards. So that's

32:10 kind of what you were seeing. Yeah, no, it's impressive. I have a car from 1991, the seat's still still return and it's amazing. They probably passed. They're a ballet flex test. it's got to

32:24 last that long. It's got to last that long. We're trying to create, it's a little bit of a catch-way to you, right? Because you want to create materials that biodegrade at the end of life in the

32:33 right circumstances with lots of bacteria or in soil. But you don't want them to break down during the products in intended lifespan. And in the case of a car, your car is from what, 1991? Yeah,

32:48 so that's - Might be older than you. Yeah, 33 years old.

32:54 So it's got to last, potentially, 33 years. In the Houston heat, outside, in the humidity. Yeah. It's no small feat. And that's why our formulations are so specific to the application that

33:06 they're serving.

33:08 And that's kind of the biggest challenge of why this problem hasn't been solved yet, right? Because there's all these things that plastic is just so good at, Or we've gotten it to the level where

33:17 it can meet all these other standards that we need. I talk to US about you know you said you moved here to Houston what drove that decision and Yeah let's start with that so I surveyed like thirty

33:31 different cities it came down to three places San Diego California Houston Excuse Me Texas and the Research triangle North Carolina Houston One out obviously because I won it's very affordable so we

33:47 knew that the money we had raised in New York was going to go a lot farther here the second thing is is that the business environment the tax environment was really favorable in Texas there was no

33:57 income tax which meant what we were able to afford to pay our employees and our our team members they would take all of that home and that would go a lot farther here so that we could afford a good

34:10 life for our team our people I met always been important to me as a leader

34:16 the the next thing was The talent here we have amazing engineering chemistry polymers towel plastics talent here in Houston because of the oil and gas industry and so we love recruiting from oil and

34:33 gas and those kind of companies and we really do see ourselves as kind of the part of this transition part of this evolution of the industry here which made that was probably the biggest reason and

34:43 then the last two reasons one is that people in Houston the culture here is very unpretentious it's very friendly it's very let's get it done what do you need how can we do it fast cars without our

34:58 culture shock coming from New York it definitely Aligned more with my Valley like I like that's why I'm really excited to be part of this community be to be a houstonian because of that attitude that

35:11 I can really relate to and that's the kind of attitude I have when I build companies having that same attitude in all of our team members was, maybe like a culture refresh or like a culture like - I

35:23 guess you're from San Antonio, right? Well, you're all from all over again. All over, San Antonio, but I did grow up in Texas. I just grew up in Texas and then you moved to New York. Is that

35:33 where you started your company? So that's where we incorporated the way we're in SOSV's indie bio program in New York, which is if you're not familiar with your SOSV is like the world's largest

35:44 investor One of the best. One of the best, yeah. So also talk to us about like what would you find in places like New York that Houston doesn't have

35:56 that we need to build? So Houston is an amazing place to scale your company. However, I think that still places like San Francisco and New York City are beating Houston and in terms of places that

36:14 are good to start. a company have an idea because there's large concentrations of investors. There's attitudes about early stage ventures that I think that we don't have here as much. They

36:27 understand the value of an idea, the potential future return of something.

36:33 And there's ecosystems like lots of accelerator programs, like S2SVs, Indibio, like Y Combinator in these kinds of places that we don't really have the infrastructure here Now that's changing,

36:46 also we're doing a lot more hard tech in Houston, so the attitudes are very different. But now we've got programs like the Energy Tech Nexus, like activate. So we're starting to get some of that

37:00 really early stage capital here that will catalyze companies to get from 0 to 1. But Houston is an amazing place to go from 1 to 10, or 1 to 100 Yeah, and then they're, you know, 'cause. That's

37:14 what they said when it comes to climate tech or like Heartache I think in general it's like the zero to one is hard but we've also seen there is a lot of an interest in venture capital going to early

37:24 stage companies that are dealing are going to tackle climate change and then there is like that infrastructure funding project finance funding that comes later that you know solar and renewables are

37:36 benefiting a lot from but then there is like the valley of death in the middle raid like going from zero to one

37:44 is hard to find capital for that 'Em and so what has been your experience like when you're talking to investors so if the early stages I think like when no one knows who you are attaching yourself to

37:58 an accelerator program or a brand like SSP and India bio is really really great and so that definitely helped us get on the map and raise that initial rounds of of seed and pre -seed capital so I

38:14 would definitely recommend that to founders is to apply for those kinds of programs for sure and and then you're right there is another kind of value of death when you're trying to scale a Pi can

38:25 reach park market fit for the first time and for that I would say I look for grant funding look for a kind of that next or like venture capital groups that are willing to invest a little bit earlier

38:43 that at combination to an early since you can rely on Angel investors but you Gotta find venture capital groups that are are family offices that are a little more flexible so there is definitely

38:52 capital out there for every stage

38:56 where you know from all the conversations that you've had with an investors in what are you learning from them like how is that mindset also changing because I can imagine a lot of these investors I

39:08 have kind of matured and grown up in the digital era and used to funding those kinds of technologies and heartache is different Yeah definitely luckily we are not as deep tech or as hard tack as a

39:25 company that's having to build a new kind of reactor right we have products we have a clear line of sight on product market fit on the markets that we're approaching and so I think that we do have

39:40 that advantage versus may be other companies that are a lot more hard tech it might need more grant funding or more government support to get to that pass that valley of death I think we have clear

39:51 lines of sight on products and that we're producing so it's not been been kind of as challenging but certainly

40:03 we've relied heavily on our investors and definitely grown up alongside and growing up because of the mentorship of our investors become thinking like a bigger company, thinking like a more

40:15 sophisticated, more professional company, having regular board meetings, reporting and making sure that we have the right organizational structures. Doesn't sound super exciting, but it's a big

40:26 part of that. It's necessary. Yeah. I was totally as an aside. I was talking to folks at Crunchbase this week. Uh-huh. And 'cause they're just curious about how people use their investor

40:38 database. Yeah. And they

40:43 were very well-meaning but knew very little about how HardTech

40:46 looked at signal. So in many ways, if you log on to Crunchbase, they have a lot of these metrics for like website visits and who's there and what's the ranking in HardTech. It's like, what

40:58 contract do you have with a manufacturer who is ready to supply product or who has the off-take for it. And in some ways, like, the -

41:07 stuff they're collecting is public data, so they have a way to identify early. But when it comes to what we're doing, there's a lot of nuance that maybe a climate-type investor just kind of knows,

41:19 but it's not like on the internet. No. And so it was just reinforcing that idea. There's a reason why software investors are software investors. Yeah. The metrics are kind of straightforward and

41:33 you need those investor partners who

41:36 are going to care about the right things within heart tech and

41:41 especially like performance materials. They're just certain things that just matter. Yep. And website visits is not one of them.

41:49 No. Yeah. Not in the same way as a web-based app would be. And there is a lot. I think it can be hard to determine the stage of a potential climate tech company where they're at. Everyone says,

42:04 you know, we're about to scale,

42:07 but you did to quantify that what does that mean what can you do so when I talked to our production team every single week and and our technical team I ask what's our production if someone placed an

42:17 order today what's the maximum order that we could fulfill day and then unable to have that conversation with investors and give them a more clear and honest picture of where we're at in terms that

42:30 scaling journey and then also show them the potential we have this agreement with this whole manufacture now in ink signed we now have the potential for millions of pounds of production volume within

42:44 three five years so they see kind of where we're at today mid term long term and they get a better picture of where we're at but that is certainly more unique to every common tech startup where like

42:58 that scaling how that fits in and and harder to to kind of quantify than software still but I think that it's coming up, and I think we're getting more and more investors are moving into this space.

43:13 Hopefully not getting too distracted with AI. We still have a planet to save, guys. Yeah, now we're gonna spend 10 minutes on Rheum's AI strategy. No, it's in our pitch tag, it's got to know it,

43:25 it's not. Yeah, where's the AI element here? If you can do this again, I mean, I'm sure there's a lot of lessons that you've learned, but what do you think is the most important? What would you

43:37 do differently? What kind of advice would you give to kind of new entrepreneurs? Yeah, well, what advice would you give to baby Zimmer? Yeah.

43:46 Well, what would I say to 19-year-old Zimri?

43:51 There's kind of two things that I think I would say. One is to find, to build a diverse team, to find older people who have

44:03 the experience that you don't have, with Babies Emery had was an amazing level of energy and optimism and drive and ambition and and that's maybe only possible because he didn't have that experience

44:17 he didn't know how hard it was going to be to do this but I would encourage him to also surround himself with older more experienced people who had been through that journey who had who knew how to

44:29 get from a to B to C in in the journey and then bring that energy and pair with I think we have that now we've had we have a more experienced team we have Robbie powder our CEO who is previously the

44:42 VP of operations as the G plasmonics who as you know decades of experience building hard tech and deep tech companies and and before that I mean so I'm Glad you brought up Robbie Yeah I mean he's one

44:55 of the few people on your team cause I haven't met everyone yet but sharing a Robbie had a whole career even before says agee or he was building heartache and he was at Baker Hughes Baker Hughes

45:03 that's right and And I think when you were speaking earlier to some of the strengths of Houston it Yet you would not find a Rabi in another city in My Opinion Nah no and it definitely not and you get

45:16 that ability to kind of recruit people in like that but I

45:22 I remember when Robbie was considering joining the team what what was that recruitment process like in terms of you getting him to jump in your two feet first so Robbie's the actually the second

45:33 person from oil and previously oil and gas the first was our Chief Science Officer DR Alex Caitlin and to convince him T T E at the time quit a job at Halliburton was was a process you know yes this

45:48 is higher risk but this is our business plan this is what we're looking to do it definitely and I liked those interviews I love it when I'm convincing the candidate to join because then I know that

45:59 there are good one right that and we convince him to come on he was the first Robbie was a bit of a different journey.

46:09 He first was our investor. So he came on and became an investor in Realm. And we had that relationship for a few years. And then he was looking for his next venture. He really enjoys early stage,

46:24 early

46:27 scale something from that one to a hundred kind of level So this was a challenge that he was very up to. Robbie called me and said, Hey, I'm looking for what I'm looking to do. And next, and I

46:39 said, Oh my God, let's do it. We can partner out, we can do this together. We can take this a lot farther faster. So it was a no brainer. I called our investors and said, Hey, how can we make

46:50 this happen? How can we bring on someone like Robbie? Yeah. And the reason I want to go down the stairs, I think there are a lot of

46:58 mid-career, a career entrepreneurial people who want to get involved in a really stage start up. and I don't think they know how and they assume I know how I'm never like I'm always just starting

47:09 Stuff I don't actually know how to get floyd into a company and I guess for some for for people like Alex and Lee Robbie Lee What's what is that path and is it just to reach out to the company they're

47:20 excited about and what what's your perspective being on the other side so

47:29 join you know make a linkedin profile look at the startups in your in your space definitely have that mission for yourself start applying for different startups I think the most important thing is is

47:41 is as someone who may be coming from industry or academics look at a culture of what you're going to be into look at the professionalism because there is a lot of risk in early -stage startups I look

47:52 at the integrity of the founder look at the track record really understand that person and the culture that they're trying to build and see if that's something that you will be part of because it's

48:02 You're going to have shaped that culture and it's going to be much more intense journey than than joining a larger company you know at an earlier stage so Yeah Yeah get on Linkedin do follow your

48:12 local innovation news like innovation map and enter detect Nexus you know look at their startups look at the startup scene in your area and look for companies that might match your skillset and then

48:27 don't be afraid to reach out and find those founders and asked to talk to them even if they don't have a job for you today certainly after they raise seed funding or series a funding opportunities

48:40 open up and then I would also say be flexible take equity equities great that's ownership Yeah that's exciting that's the risk that's the reward that's the reason that you're in the game to play the

48:52 game is to own what you're building an end to to have that be part of who you are so Yeah You know you would have not called Robbie because you wouldn't have thought you know he's available rates as

49:07 IkE and right it's also just calling that person and seeing like if there's if there's an opening if there's a way for you guys to collaborate and being flexible and we have a whole other pipeline of

49:19 of people who we weren't able to hire now but are on our list to have to call as soon as we Raise our series A

49:30 yes or tell us what's next for you on your Journey HMM Yeah So we're looking to interview to grow to continue expand we're looking to raise a series a that's something that we're very excited about

49:45 with that money which could take a little bit to raise but once we have that capital in our accounts we're looking to increase our product development speed so take out right now it takes US about

49:56 thirty days to get a formulation from idea to you know full testing and analysis done we want to bring that down to ten days say will increase our in -house capabilities build a nuke have new

50:10 equipment to do off pride development and more testing internally so we want more bally flex testing so when you see the lab next time I want a similar pose material apart not just you know you want

50:23 to have machines that shoot the material with bullets now we might soak opted to dallas for that one but we definitely want all our capabilities to be able to iterate faster and find product market

50:35 fit in each market segment that we're approaching faster and we're also looking to hit you know larger manufacturing volumes you have logistics and warehouses to be able to produce up to fifty

50:50 thousand pounds within two to three years of raising that series a which is well past what we would need to break even as a company and become profitable And then on the sustainability side, we want

51:05 to map up to 70 of our supply chain and have data to show our customers. Full life cycle analysis is full biodegraduation studies. These studies are really expensive, but we need to have a full

51:18 portfolio of them. And then speaking of portfolios, our IP past the Series A, we're looking to file 10 or more international patents on our technology, which also includes the start of a new

51:31 material venture, which is going to be bio-fibers. So think of fibers for textiles, like your coat, your shirt, woven textiles like that.

51:43 And I assume that's a very technical challenge, and that's why you haven't pursued it yet.

51:48 We could get started. If you know some, like, we calculated it out, and it's like, I'm gonna cost about half a million dollars to launch, like, initial bio-fiber division.

51:59 call me the next thing on the roadmap the next thing on the roadmap exactly

52:04 and some will look forward to hear how that goes I am excited for your growth and well being thank you thank you for having me