Friendly competitor LS9 congratulates Amyris on $25M raise

The race is on to see who can commercialize next-generation renewable biofuels the fastest.

But with the global biofuel market predicted to surpass $280 billion by 2022, there's room for friendly competitors Emeryville, Calif.-based Amyris Biotechnologies and South San Francisco, Calif.-based LS9 to share in the potential profits.

Amyris, which makes biofuels from synthetic microorganisms, said today it edged a little closer to the finish line, acknowledging a $24.7 million first close of a potential $62 million Series C to ramp up its synthetic biology platform.

Both Amyris and LS9 are looking to lock in Series C rounds to help them meet aggressive production deadlines.

Amyris spokeswoman Annika Jensen told the Cleantech Group the company is expecting subsequent closings this fall.

“This first close of this Series C will be used to accelerate the development and scale up of Amyris’s synthetic biology platform and supports the commercialization of our renewable fuels and chemicals, which is targeted for 2011,” she said, without providing specifics.

The company has previously raised $120 million, she said (see Amyris pulls in $70M for unique biofuel and Amyris Biotechnologies evolving ethanol).

She also confirmed today’s latest round included existing investors Khosla Ventures, Kleiner Perkins Caufield & Byers, TPG Biotech and Votorantim Novos Negocios.

Unlike traditional biodiesel from lipids and fatty acids, Amyris produces renewable products by applying a proprietary synthetic biology platform. By altering the metabolic pathways of yeast, Amyris said it is able to engineer “living factories” that convert sugar cane into chemicals and renewable fuels, which it said have performance attributes comparable to petroleum-based products.

LS9’s CEO Bill Haywood told the Cleantech Group today that his company’s strategy and process is very similar to Amyris, with both companies using metabolic pathways in a host organism.

“They have been raising money to scale their technology just like we have been doing,” he said.

LS9 says it has demonstrated the ability to modify the genetic makeup of its microorganisms and tailor its products to have improved fuel properties, such as cetane, volatility and cold flow.

Also a Khosla Ventures-backed company, LS9 has raised $20 million in two rounds that included Lightspeed Venture Partners and Flagship Ventures (see LS9, latest Khosla investment, gets $5M). LS9 has a Series C round currently open, where it is looking to add $10 million to the undisclosed amount raised so far and is contemplating a follow-on.

LS9 has a pilot plant in South San Francisco that’s been operating for more than a year now, Haywood said. The company has been working to prove its technology, wants to build a demonstration facility next and then move into commercialization.

“Both companies have very aggressive agendas,” he said. “It has never been done before. It’s cutting-edge stuff. You have very disciplined milestones on the scale and the technology,” he said.

LS9 has said it’s going to be at commercial capabilities in 2011, with commercial quantities being produced in 2013.

“I’m behind what Amyris is doing," said Haywood, in a supportive way. "I hope we both make it along with two or three others.”

Amyris, spun out from the University of California, Berkeley in 2003, opened a demonstration facility for its bio-based diesel in Campinas, Brazil in June. The facility, located in the midst of the sugar cane processing industry, is the first of its kind in Brazil. It is designed to execute in-country scale-up and demonstration of all Amyris fuels and chemical manufacturing processes, Jensen said.

Amyris has a pilot plant in Emeryville, which houses two 300-liter fermentors producing thousands of gallons of Amyris product a year for testing (see Microbes drive new Amyris biodiesel plant). Amyris opened its larger demonstration facility in June in Brazil, which includes a pilot plant similar to the one in Emeryville plus two 5,000-liter fermentors, which have the capacity to produce 35,000 liters of product a year for testing.

The company's subsidiary Amyris Fuels is building U.S.-based product distribution, generating current undisclosed revenue from an expanding distribution and customer network, she said.

Established in March of 2008, the company's other subsidiary Amyris Brasil oversees the company’s final scale up, production and distribution in Brazil. It was established when Amyris acquired the outstanding stake in a venture it had with Brazil's Crystalsev, a sugar and ethanol production company (see Amyris, Crystalsev in sugarcane biodiesel venture).

Amyris Brasil has approximately 40 employees and facilities in Campinas, including labs, a pilot plant and demonstration facility.

LS9’s business plan also includes making its fuels in Brazil, where sugar cane is inexpensive and there’s good biofuel manufacturing capabilities. LS9’s biofuel product has exceeded both American and Brazilian testing specifications (see LS9’s clean diesel meets U.S., Brazilian requirements).

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