Over its 17-year history, LanzaTech has become known for helping big-name brands like Unilever and Lululemon turn factory pollution into everyday consumer products. And now the Chicago company is looking to scale its carbon recycling technology faster with a public listing later this year.
LanzaTech announced last week that it plans to go public in a SPAC deal with AMCI Acquisition Corp. II. The deal, slated for the third quarter, aims to raise $125 million and would value LanzaTech at $2.2 billion.
SPACs, or special-purpose acquisition companies, became increasingly popular in 2020 as a way for firms to go public outside of a traditional IPO. But the SPAC market has cooled considerably in recent months as companies have seen their share prices tumble and others have scrapped planned SPAC mergers altogether.
That hasn't spooked LanzaTech CEO Jennifer Holmgren, who believes her company is in a prime position for a public listing despite what she called a "squirrelly" market.
"My view is if you’ve got the fundamentals and the infrastructure, you weather all of that," she told Chicago Inno. "There’s so much focus on not rebuilding our economies after the pandemic just on the same old fossil economy. Growth is about green (energy) and sustainability."
Holmgren said LanzaTech, which is forecasting $65 million in revenue this year, considered both a SPAC and a traditional IPO. But it opted for a SPAC in part thanks to its blank-check firm AMCI, a group that invests in businesses focused on energy and natural resources. Holmgren called AMCI "additive" to LanzaTech's business.
"When you’re building relationships with someone who can help you grow, then a SPAC is a true merger rather than simply a path to the market," she said.
LanzaTech, which has raised more than $500 million in outside funding since its launch in 2005, also considered another round of private financing, Holmgren said. But ultimately, the decision was made to test the market.
"It's time for us to be public," she said.
LanzaTech has developed carbon recycling technology that converts pollution from steel mills into sustainable fuels and chemicals. LanzaTech can take factory emissions and create ethanol, which is then processed into monoethylene glycol, which is then used to make products like polyester.
The company's technology has caught the eye of several well-known brands, some of which have cold-called or contacted LanzaTech through its website to try to partner. Lululemon was one such inbound request that led to a deal, which saw the fashion brand use LanzaTech to create fabric from recycled carbon emissions. Zara took a similar approach, and its collection with LanzaTech is the first clothing line to come to market using the technology.
Beauty brand Coty works with LanzaTech to create sustainable fragrances, and Unliever partnered with the company to produce a laundry detergent pod.
"Part of (brand interest) is because what we do is new and disruptive," Holmgren said. "Customer acquisition has been just about getting the word out that there is a future where you can recycle above-the-ground carbon and convert it and transform it to product we use in our daily lives."
LanzaTech has grown to more than 300 employees, 200 of whom are in Chicago. It plans to add another 30 to 50 employees this year, Holmgren said.
LanzaTech's goal of meaningfully reducing greenhouse gas emissions will take a step forward when the company goes public, Holmgren said, by allowing the company to scale faster and bring its technology to more customers.
"It's possible to do this," she said. "We just have to go faster. Much, much faster."
