Dutch startup Vertoro has raised €17m to scale up a kind of green fuel that could help power the ships and planes of the future.
The round, first reported by Dutch financial newspaper Het Financieele Dagblad, combines €7m in debt-to-equity conversions from existing investors with €10m in new capital.
Investors include Invest-NL and the investment arm of shipping giant Maersk, alongside Climate Tech Partners (backed by Qantas and Airbus), Rotterdam Energy Transition Fund, Liof, Shift Invest, and Chemelot Ventures.
Fuel from leftovers
Vertoro, founded in 2017, makes oil from the leftovers of bio-ethanol production. When plants like wheat or sugarcane are fermented into fuel, they leave behind lignin, the tough fibrous material that holds plant cells together. Most facilities just burn it. Vertoro has developed a process that converts it into a dense, energy-rich oil instead.
The trick is doing it gently. Where most industrial processes use high heat and pressure, Vertoro runs its reactor cool and slow, preserving the properties that make lignin useful rather than destroying them. The resulting oil can slot into existing industrial pipelines without major retooling, which the company says makes scaling significantly faster and cheaper than building new infrastructure from scratch.
Towards a commercial plant
The fresh capital will go first toward upgrading the demonstration plant at Chemelot industrial site to run reliably for 1,000 consecutive hours. Co-founder Michael Boot told FD that hitting that milestone is a prerequisite before designing a first commercial plant, which he estimates could cost around €100m.
"We've learned a lot over the past few years," Boot said. "Now we need to make sure the factory can run for a thousand hours without problems. Only then can you say you really understand what you're doing."
The near-term pitch to customers is fairly pragmatic. Plastics manufacturers making food packaging can blend lignin-oil into existing production processes without raising costs, Boot says. Longer-term, the same oil can be certified for use in coatings, adhesives, automotive parts, shipping fuel, and sustainable aviation fuel.
"This investment fits in perfectly with Invest-NL's strategy for a circular and biobased economy and contributes to reducing dependence on fossil fuels," Elwin van Rooijen, senior investment manager at Invest-NL, wrote in a LinkedIn post published by Invest-NL CEO Rinke Zonneveld.
Tough fundraising
Vertoro has also brought in a new CEO, Dirk den Ouden, hired from packaging company Stora Enso to professionalise the business ahead of its next phase. The funding buys the company roughly two years of runway. It is still in talks with investors for additional capital.
Getting here was not straightforward. The round took far longer to close than anticipated, with Boot pointing to three compounding problems: US rollback of shipping decarbonisation rules, financial difficulties at Raizen, the Brazilian biofuel company Vertoro had named as a scale-up partner, and a broader freeze in ESG investing.
"Responsible investing is in a bit of a mess," Boot told FD. "We hear everywhere that it's hard to raise money for sustainable initiatives. So you have to be patient, cast the net wide, and adapt your story to the times."
Invest-NL’s Zonneveld also commented on the timeline. "The fact that building such a groundbreaking company takes a long time is evident from the fact that this partnership was already started in 2017," he wrote on LinkedIn.
Vertoro originated as a spin-off from a collaboration between Brightlands Chemelot Campus, DSM, Maastricht University, and Eindhoven University of Technology.