BASF Venture Capital and Aqua-Spark invest in Sea6 Energy

The investment will support the project to offer red seaweed biomass and products on a large scale, both sustainably and reliably.

BASF Venture Capital, the corporate venture company of BASF SE, Germany, and Aqua-Spark, a Dutch investment fund focusing on the global aquaculture industry, are investing in Sea6 Energy (the company) as part of a Series B round. Sea6 Energy was founded in 2010 and is located in Bangalore, India. The company is a leader in the production and processing of tropical red seaweed. Other existing investors include Tata Capital Innovations Fund. With this investment, Sea6 Energy will complete its Series B transaction of INR 1402 million (about $18.5 million). 

Red seaweed grows mainly in tropical waters in Asia, which have constant, high temperatures conducive to year-round growth of seaweed. Biomass from the fast-growing red seaweed is suitable as a raw material for a variety of applications, for example in animal feed and crop protection products, as an ingredient in cosmetics or a gelling ingredient in the food industry. Only a small proportion of the commercially offered seaweed comes from wild collections. Most of it is grown in farms, particularly in Asia, and since 1950, the quantity produced worldwide has increased a thousandfold. In 2019, nearly 35 million tonnes of seaweed were produced, about half of which is red seaweed.¹ The market volume for seaweed products was almost $17 billion in 2020.² However, commercial offshore cultivation on a large scale is complex, and the technical systems must withstand adverse weather conditions, such as storms and waves. 

Helping crude industries transition renewable feedstocks

Sea6 Energy has adapted its cultivation technology to withstand deep-water and adverse weather conditions and covers both parts of the value chain with its integrated business model. To identify the right locations with the right conditions for its farms, Sea6 Energy uses satellite imagery, for example. Under suitable conditions, at least six harvests per year are possible. 

Although the company is headquartered in India, it has established a fully owned subsidiary in Bali, Indonesia, which carries out commercial seaweed farming. Sea6 operates various plants in Tuticorin, India, for further processing red seaweed for different applications. For example, the company produces bio-stimulants for use in agriculture and shrimp farming that increase resistance to disease and stress. Sea6 Energy is also developing bioplastics and biofuels based on red seaweed. It has developed a proprietary process that increases the shelf life of red seaweed from one to two days to up to 60 days. This facilitates the transport of fresh red seaweed, which can otherwise only be transported over longer distances once it has been dried. 

“Sea6 Energy’s integrated business model is convincing,” said Markus Solibieda, managing director of BASF Venture Capital. “With its extensive experience in the field of biotechnology, the team has created very good upstream conditions for the large scale cultivation of red seaweed as biomass while demonstrating success downstream through its bio-refinery. This opens up opportunities for transitioning traditionally crude-dependent industries such as the chemical industry to renewable feedstocks.” 

Game-changing seaweed cultivation technology

“Our vision is to be able to offer red seaweed biomass and products on a large scale, both sustainably and reliably. Thanks to our patented mechanised cultivation technology, we can produce high quality biomass on a large scale at competitive pricing. This can also enable products such as bioplastics and biofuels,” says Shrikumar Suryanarayan, CEO and co-founder of Sea6 Energy. “We look forward to having experienced BASF partners at our side and are happy about the renewed commitment of Aqua-Spark.” 

“Sea6 has made great progress over the past year, and we are excited to continue to support the company. We believe Sea6’s seaweed cultivation technology is a real game-changer in the industry, making a variety of applications of red seaweed possible on a commercial scale,” said Aqua-Spark managing partners Mike Velings and Amy Novogratz. Aqua-Spark has been an investor in Sea6 Energy since June 2021. 

The transaction also provides partial exit and liquidity to Tata Capital Innovations Fund. 

References:

1.  Global status of seaweed status of seaweed production, trade and utilisation, FAO, 28 May 2021  
2. MarketsandMarkets: Seaweed Cultivation Market, October 2020