• The demand for PAPTIC material on the market allows for the company's quick transition to industrial-scale production

Finnish startup Paptic to invest in paper machine

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Finnish startup Paptic to invest in paper machine

February 27, 2017 - 08:40
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ESPOO, Finland, Feb. 27, 2017 (Press Release) -Finnish startup company Paptic Ltd is planning paper machine investment to upscale PAPTIC patented technology and material production. The demand for PAPTIC material on the market allows for the company's quick transition to industrial-scale production. Currently Paptic is negotiating the financing of the investment with a number of actors. The investment is scheduled to begin in 2018 and its impact on employment will be more than 30 people.

The capital needed for upscaling is a challenge for bioeconomy startups Bioeconomy is one of Finland's national economy's peg legs, but it is a highly capital-intensive industrial sector. Paptic's goal is to move to industrial-scale production in 2018, less than four years after the company's launch. Paptic's business model is built on strong partnering in the traditional paper industry value network.

The forest industry has closed down a lot of paper manufacturing capacity in recent years. Paptic seeks to take advantage of this existing infrastructure to upscale production with a capital-efficient model. Sharing infrastructure also creates significant synergies when production begins.

“Such an approach is standard practice in many industries, and now we use this model in the commercialization of new bioeconomy products ", says Managing Director Tuomas Mustonen.

Paptic was also selected as one of the ten hottest start-up companies of the year by Talouselämä and is the only one representing the bioeconomy.

There must be a quick response to market demand Plastic waste accumulating in the seas and oceans is a global problem. Replacing plastic with wood-based packaging solutions for short life packaging applications is one of the key ways to meet the challenge. This is reflected in the responsible international brand owners' interest in Paptic.

”The interest in Paptic's products from the international consumer products business sector has been greater than anticipated and therefore now is the time to increase production capacity, "says Business Development Manager Esa Torniainen.

EU funding enables rapid progress The EU Horizon 2020 Programme has granted approximately two million euro project financing support to Paptic for paper machine investment and technical upscaling. Funding will enable a significantly faster and more efficient design project.

”However, funding alone is not enough, we also need good cooperation partners, for example research institutions and equipment suppliers", says R&D Manager Karita Kinnunen-Raudaskoski.

Several options for the investment location

The cost efficiency of Paptic's upscaling model is based on the utilization of existing paper producing environments. In addition to being cost-effective this also allows for starting up production faster than building a whole new plant.

Paptic is currently in discussions concerning investment locations and possible co-operation models with selected paper manufacturers.

”Judging from the number of contacts we have received both in Finland and from around the world there are many factories interested in the possibilities the new product can bring to expand plant operations and strengthen its ability to succeed in the future", says Managing Director Mustonen, and encourages companies to contact Paptic if they are interested in cooperation. The market that Paptic aspires to, flexible packaging in its various forms, is many times that of a single machine capacity.

During the first two years of operation Paptic collected EUR 2 million in private capital. The 10 million euro A series investment round to be collected by autumn 2017 will play a key role in the implementation of the future scaling investment.

“Our products enable the creation of a new fibre-based packaging material brand. The demand for bio-based products is growing rapidly, and that is why now is the right time to bring in a new sustainable alternative to the market.

Together with our partners and investors, we will make Paptic a bioeconomy success story ", Mustonen sums up.

Paptic material:

Paptic's wood-based material can replace plastic in many applications. Finnish Paptic Ltd's patented technology can be used to produce eco-friendly fiber products for many packaging applications. Paptic Ltd began operations in April 2015 and delivered its first products to the customer (Seppälä) in June 2016.

Paptic will be making an investment decision in 2017 and in 2018 move to production scale.