Sweetwater Energy Closes $9 Million Series A Funding Round
Sweetwater Energy, Inc., a Rochester, NY-based cellulosic sugar manufacturer, announced today it has oversubscribed and closed its Series A funding round. The company sought $5 million in initial funding, but investor response was greater than expected, leading CEO Arunas Chesonis to close the round at $9 million.
“As anyone trying to start a business today knows, the economic climate is very difficult for fundraising right now, but we received an incredible response,” says Keith Wilson, Sweetwater’s Chief Financial Officer. “This funding is already launching us into our next stage of development, which includes Sweetwater’s first commercial contracts and the design and fabrication of the first wave of facilities for 2013.”
Sweetwater Energy uses a unique technology to produce low-cost sugars from non-food plant materials. The company’s sugar solution is sold to refineries, which use it to produce biofuels, biochemicals, and bioplastics. Unlike petroleum-based technologies, Sweetwater Energy’s process uses renewable plant materials that are not only grown domestically, but significantly reduce greenhouse gas emissions.
Sweetwater’s initial $1.2 million seed round closed in February, 2010, financed in large part by Chesonis and Jack Baron, Sweetwater’s President and Chief Operating Officer. That funding, along with grants from the New York State Energy Research and Development Authority and early revenues from Department of Defense research sales to produce jet fuel for the U.S. military, allowed Sweetwater to develop its novel decentralized sugar platform technology. That technology and other recent advances in the Sweetwater laboratories are now being engineered into Sweetwater’s first commercial facilities.
“Ultimately, it’s the economic and cost drivers for lower-cost petroleum substitutes that are fueling the remarkable demand for Sweetwater’s technology,” says Chesonis. "We're excited to raise this capital and move into the next stage of growth; commercial contracts to fulfill that remarkable demand."
Earlier this year, Sweetwater began operation of its pilot-scale cellulosic sugar processing facility at its location at 500 Lee Road, in Rochester, NY. Sweetwater’s chemists and engineers are using the pilot system in conjunction with Sweetwater’s laboratory to test new ways to quickly optimize the extraction of useful sugars from a wide variety of plant materials. Sweetwater is currently constructing a demonstration-scale facility at the same location later this year, which will allow final vetting of the Sweetwater technology at commercial scale.