Bham startup creating biodegradable meat trays, aims to scale

A Birmingham-based material science company is gearing up to scale as it nears commercialization.

The Innovation Depot-based company, StenCo, makes a sustainable, biodegradable coating that can be applied to paper or compostable bowls and trays.

How it works

John Brown, CEO and founder of StenCo, used a familiar example to explain what the startup does.

"Chipotle bowls — they completely disintegrate after about an hour, and you're eating a salad or a burrito bowl and it just leaks straight through to the table. If you applied our material to it, it doesn't do that. ... We're applying a coating to those types of materials that gives it the performance of plastic while being biodegradable and sustainable."

The company was founded December 2019 and is now close to getting the green light to commercialize its technology. Its flagship opportunity is with major food corporation Cargill Inc. Through the partnership, StenCo is using its product as a coating for molded fiber trays to extend their shelf life, developing a fully biodegradable ground beef tray.

"We've been working to optimize our product and our offering to the market based on collaboration with various people in the packaging industry. We've been working off of joint development agreements to apply our technology to other people's problems, in particular when it comes to sustainable packaging," Brown said.

In doing so, the company has needed to scale up, buy more equipment and perfect formulations.

"That's a very big technical hurdle," Brown said. "There are a lot of moving parts, but the good news is that we're turning the corner towards commercialization."

Highlights in the past year include getting the technical approval that StenCo was meeting all of the performance specifications and solidifying its partnerships, he said. The company will be working with organizations providing the technical know-how and the chemistry, without doing the manufacturing.

"We're partnering with various organizations to bring the entire product to market," Brown said. "All of those things coming into place has been really pivotal over the last 12 months."

Growth and expansion

Since its inception in Innovation Depot nearly four years ago, StenCo has also expanded its space from a single lab to two larger ones and a dedicated office space. Future expansions or moves will be determined by the needs for the next phase of commercialization, which Brown referred to as an open question.

And the growth is steady. The startup began with just one employee and now boasts a headcount of five full-time employees.

As the company enters the next phases of commercialization, Brown said he anticipates a need to double the headcount over the next one to two years. Those new hires will most likely be chemists, quality control specialists and engineers.

Funding journey

When it comes to the funding journey for the company, it has been a challenge, however.

"It's not necessarily due to the lack of the funds availability," Brown said. "It's been due to the unfamiliarity with what it is that we do. There are not very many people who can readily understand what we're we're doing from a technical standpoint ... I think the more specialized you are, the more narrow your investor base is, and therefore your pool gets smaller, especially locally."

The company has been able to post a lot of short term revenue, however, that has limited the need to raise funds, something that helped existing investors and provided support to the company in the way of paying customers, Brown said.

As for the startups biggest challenge, he said it's that lead times for the conversion of an idea to monetary results is typically measured in years.

"It's not something you can just start selling tomorrow," he said. "There are long trials that need to be run. There's scaling up. There are a lot of things that have to happen. Managing the expectations of both yourself as an entrepreneur and your investors is critical, because what we're doing is not easy."