Serious Materials announced recently that it has succeeded in securing another $60 million in venture capital financing, bringing the company’s total capital raised to $120 million from a range of investors.
Company president Kevin Surace spoke with Remodeling about the fundraising efforts, saying that the investment funds will be put to good use in growing the company and its lines of energy-efficient products.
“Most of this is about expansion and bringing new products to market,” Surace says. “We have a big research-and-development pipeline here, and we’re continuing to expand our market. We also have five plants in full production, so some of the money will be put into ramping up those plants and putting money into sales and marketing.”
Surace calls the industry in which Serious Materials operates “clean tech,” a relatively new term for what many building products companies call “green,” Clean tech comprises renewable energies and high-efficiency technologies, which are getting Serious Materials’ focus in its window, weatherization, and drywall businesses.
“We have study after study showing that there’s nothing that brings more energy savings and more payback than changing to high R-value windows in almost any building,” Surace says. “The technologies we’re using now let us offer center-of-glass R-values from R-5 to R-11 to as high as R-20. Windows like these weren’t widely available until the last couple of years, and now they’re a runaway success, not just because of green and climate change, but because they can help you save money.”
Clean Tech to Revitalize Manufacturing
Numerous headlines in recent weeks have identified clean tech as a segment that is not just gaining interest among building products companies and investors, but in the manufacturing sector as a whole. Reuters recently reported that the clean tech sector has “accumulated $1.59 billion across 134 companies,” representing a 10% increase over the $1.2 billion invested in the second quarter. “Investors are saying that up to now, material science had been highly ignored,” Surace says. “Of late, everyone’s woken up to the fact that we have not funded these sorts of technologies – we were funding IT, and not much else. That’s really changed. Clean tech is here and we’re very focused on energy savings.”
While the Reuters report (http://www.reuters.com/article/mnGreenInvesting/idUS281263756020091002) notes that a surge in clean tech investment in clean tech does not translate to immediate economic recovery, Surace believes it does signify a re-emergence of American manufacturing.
“Everything is up for reinvention – the next industrial revolution,” he says. “A lot of old-line manufacturers won’t survive the change. There will be some companies that lag behind and have to protect their investments in their products, but they’ll end up yielding to new manufacturers that are part of clean tech manufacturing.”
As opposed to “survival of the fittest,” Surace calls the reinvigoration of manufacturing a “survival of the newest” situation. “Dual-pane windows were invented in 1865, and we’re still calling them ‘energy saving,’ even though there have been so many advancements,” he says. “The horse-and-buggy suppliers didn’t turn around and start making cars, and we can’t expect old-line manufacturers to be able to make a drastic change either.”
Moving forward, Surace says the manufacturing sector has a lot of work to do, but the opportunity for success is there. “Renewables haven’t been able to make a dent yet, and the country has been shedding manufacturing job,” he says. “Serious Materials is taking this opportunity to lead the world in this space, and we have to do that as manufacturers to help the economy recover.”