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Deeptech December 6, 2021

Meet Reselo: the startup turning birch bark into sneakers

A rising global demand for rubber is threatening our planet. We spoke to Reselo co-founder Thomas Baumgarten to find out how his team is replacing fossil-based plastics with green biomaterials through sustainable chemistry and get his advice for other entrepreneurs.

Reselo co-founder Thomas Baumgarten.

How did you come up with the idea for Reselo?

I’m German and I came to Sweden to do a PhD in biochemistry at Stockholm University 10 years ago. I never thought I’d stay, but it’s easy to get stuck here. I realized I didn’t want to continue in science, but back then it was difficult to get into industry, so I applied for a stipend at the Wallenberg Wood Science Center at KTH as a postdoc. 

That was when I got into sustainability and what the problems are from a material science perspective, which are huge. I also realised that there’s not actually as much progress as you’d think and hope for. Take the tyre industry, for example. Every three or four years when there’s a big event they’d present a tyre that’s bio-based. You think it’s going to hit the streets, but it never does, it’s just more of a PR thing. On the other hand, developing sustainable fossil-free materials is also a huge challenge because the amounts needed are enormous. 

During my post-doc I was playing around with birch bark and at some point I got this rubber material and thought, ‘hey, that’s cool.’ Then I showed it to Gustav Notander who is a business coach at KTH Innovation and he saw some potential and suggested trying to commercialise this technology. It took me a while to come round to the idea because I never thought I’d start a company. So I’m more of an accidental entrepreneur.

What happened next?

First, I did Sting’s Deeptech Test Drive course, which gave me a clearer idea of what a startup journey could look like. Then, I joined the Startup Climate Action challenge by Sting and Norrsken, which was a team competition. Initially, I was concerned because I did not have a team but the platform made it pretty easy to find others with relevant skills and experience. In the end, I got really lucky with recruiting a great team, and when we realized we could work well together, we decided to go for it.

Tell us about your product, Nordic Bio-Rubber. 

Nordic Bio-Rubber is made of birch bark, which is a massive byproduct of the forestry, pulp and paper industries in the Nordics. This residue isn’t refined today, they just burn it to generate energy. But this creates a lot of carbon dioxide and has to stop at some point.

From a chemical point of view, there are some interesting compounds in birch bark and isolating these compounds holds great potential for developing biomaterials. I’m not an expert in material science, I did something very different before, but coming in from the outside you have a different perspective on processes. I was less focused on extracting individual molecules from the birch bark, because this has been done before and yields are too low for bulk applications. I realized that if you take a big fraction of the bark and create a material out of it, you’re much more likely to have something scalable. 

Now, we’ve managed to develop a truly sustainable alternative to synthetic rubbers, which we called Nordic Bio-Rubber.

What problem are you trying to solve? 

The global rubber market is worth around USD 45 billion, which is enormous. Today, rubbers are mostly synthetic, fossil-fuel based materials that are produced using strong chemicals . Natural rubber is also common but it’s plantation causes deforestation of tropical rain forest and competes for land with food production. 

Nordic Bio-Rubber eradicates these issues, and with over a million tons of residual birch bark created each year in Sweden and Finland, we’ve got plenty of it to go around. We’re also looking beyond rubber and exploring ways to create other biomaterials. I believe starting from abundant renewable feedstocks has to be the basis for developing sustainable alternatives to fossil-based plastics.

What can Nordic Bio-Rubber be used for? 

Nordic Bio-Rubber can be used as a sustainable alternative to many synthetic rubbers, as it has similar properties as traditional rubbers. Initially, I thought we could make Lego tires from Nordic Bio-Rubber because back then I spent a lot of time with my son playing with Lego. Now, our customers are mainly fashion brands, because our material is great for shoes, but in the long term we believe that our material can be used in many other applications. You can probably make everything from toys to yoga mats. 

After getting some media coverage, we have been contacted by businesses asking if they can use Nordic Bio-Rubber for other applications too. Such a great demand and interest is very encouraging for us.  

What are the most important things you’ve learned so far from a startup perspective?

Every startup is on a different journey and things can develop in very different ways, so you have to be flexible. For example, other deep tech companies I’ve come across have developed much slower with usually a few years passing by before they could attract seed funding. So first I thought okay, I am prepared to have this as a side project for 3-4 years but then half a year later things got really serious. Basically things can go fast or slow, and you have to be prepared for that. And you need to accept that not everything is in your control. 

What sort of things have you found are beyond your control?

How developed the market is. You can have a great product, but if your customers don’t agree, it doesn’t matter. Everyone was telling us that we really need to convince customers to try our product but soon we realised that for us it was the other way around. Customers were super interested in our material and they wanted to have it as soon as possible. So we were really lucky that the market is much more developed than for most other innovations.

Have you faced any other unexpected challenges?

There’s some personal risk involved when you start a company, like financial security. About five months before founding Reselo, I joined a biotech company as a full-time researcher. But since Reselo developed so quickly, I felt I had to spend more time on it to keep the traction going. So I was very open with my former employer which was a bit risky since I was still within my probation period, but we agreed that I could reduce my hours to 80% and this support was incredibly helpful and mitigated my personal financial risks. 

Many people will tell you that you have to commit 100% to launching your own business, and you’ll have to work 80 hours a week and so on. But I don’t think that’s true. Nowadays, with working from home and part-time contracts we are much more flexible, so you don’t necessarily have to take this risk in the beginning. 

Of course, there’ll be a time when you have to commit fully, but if I didn’t have some kind of financial security, even just for six months, or a year, Reselo wouldn’t have happened. I have a family to support too and that’s something I cannot compromise on. So being able to keep my regular job at the same time as starting Reselo was a really good thing. 

Also in Sweden people generally have a very positive attitude towards starting a company. When I told my family in Germany what I’m doing everybody’s like, ‘did you really think this through? Are you crazy?’, because their mindset is very different. I think entrepreneurship is really encouraged in Sweden, and there are more laws and rules that make it easier than in other countries, like the fact that in Sweden as a researcher at a university you own your technology. In contrast, anywhere else the university owns “your” invention which can be a great hurdle when trying to bring technology to the market.

What is your advice for other startups in a similar space to you?

First of all, enjoy the ride – building your own company is a lot of fun! Second, get external help early on from somebody who’s more experienced than you and get their feedback too. It doesn’t cost you anything and it can help guide you in the right direction. You can always evaluate if you think it’s worth following it or not though, that’s your decision and it can be a very personal decision too. 

Where is Reselo today, and what’s next?

So far, Reselo has been very successful. We’re just over a year old, and customers and VCs are already super interested. We also won startup of the year at the Venture Cup last month. 

We have market verification, which is one of the most important things, and we have technical verification from a third party. Now, we need investment so that we can start scaling our technology with a pilot, a demo production plant and eventually a full size production plant. This will take years, and everybody knows that. However, we also need investors that are patienced enough to join us on such a long journey.  

How has Sting helped you on your journey?

We definitely benefit a lot from the combined experience of the Sting team and the wide network of Sting companies. Opening doors is also something that helps. You get introduced to a lot of contacts and a big business network. And for me the pre-incubator programs, like the Deeptech Test Drive, are really good initiatives to get people out of the lab and evaluate their ideas to see if they have real business potential. It’s a great way to test yourself, the technology, and get feedback from others to see if it’s worth doing.

Would you like to learn more about Reselo?

Head to their LinkedIn or contact info@reselo.se.

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