Chemical StartUps Series #20: Radisurf

Please introduce the value proposition of your company. How will your company disrupt or dramatically change how things are currently done?

RadiSurf is the leading expert and provider of coating solutions based on the high impact and versatile polymer brush technology. With our breakthrough patent protected RadiSurf? Process, we are the only industrial operator utilizing polymer brushes for the broader markets at competitive cost.

Polymer brushes are essentially nanometer-thin layers of plastic chains chemically attached to a substrate, which provides unique tailorable surface features. These features include everything from unmatched bonding to plastics to unique surfaces functionalities such as super-hydrophobicity, friction control and antifouling. Features that are highly sought for in almost any manufacturing industry. With our process solution, mass utilization of polymer brushes has finally become a reality, bringing a revolutionary manufacturing tool to the industry that enable production of safer, more sustainable products with superior performance.

Few direct competing technologies exists that exhibit comparable performance and none with similar versatility, but we primarily aim for the high-performance adhesive and nanocoatings markets, facing the competition from actors operating in these industries. These actors include household names such as 3M, Henkel, Bostik and Huntsmann, more niche players such as Permabond and Masterbond, and a handful of other smaller companies as ourselves developing disruptive joining or nanocoating technologies – although few at similar cost level.    

We have run countless industry projects for our clients, that includes everything from niche innovators to Fortune 500 companies, providing unique adhesive or coating solutions to detrimental challenges unsolvable with available options. One client case to highlight in this matter, is how we provided the Danish sensor manufacturer Unisense A/S with a tailored solution that secured bonding for a critical polystyrene component to a thin glassfiber thread. Our solutions improved the lifetime of the sensor device, with a market price of hundreds of US dollar, from minutes to months of repeated use – and we put the solution on the market within 4 months from initial contact with the customer.     

Who are your customers and how large is the addressable market for your products/services?

Our solution applies to manufacturing industries across all fields where there is a need for high performance bonding or for specialized coating solutions. No need to say, this provides an enormous pool of potential customers and our clients come from almost every possible industry segment ranging from automotive, electronics and energy, to medico and chemicals. Further on, our clients include everything from small innovators still in development phase with unique products to industrial giants with hundreds of thousands of employees.  

Our main addressable markets are the high-performance adhesive market worth 10.5 billion USD and the fast-growing nanocoating market worth 6.6 billion USD. However, over time we expect to grow a unique billion USD market for polymer brushes alone. Current focus in our commercialization strategy is on less regulated, but high-end niche markets, which allow for a shorter route to market and a higher willingness to pay premium price for our coatings. Potential worth of these markets is still several hundred million USD, providing room for growth until we are ready to address the larger markets.

How scalable do you believe your company is?

Our solutions are global, versatile and industry agnostic. Currently we service our customers with an inhouse coating service conducted professionally, but still by mainly manual operations. Our capacity is nearly reached, so we aim to scale up our coating service in 2020 with automated flexible coating systems, both to increase capacity and to cut coating costs. Two factors that will open new larger markets, increase profit margin and allow for revenue growth. Our next target is licensing of our coating technology with supply of chemical mixtures for customers requiring inhouse production. The license option provides a global and highly scalable revenue model dipping into a huge pool of customers in the manufacturing industry. We are also targeting launch of our own unique products based on components coated polymer brushes, directed towards the global market, which provides another scalable revenue model.

In sum, we are in a position to reach huge markets with a superior product and we have a strategy to rapidly scale our business into these markets to over time become a major player.

Can you summarize the journey of your company up to this point?

The company was founded in 2015, based on a unique technology for bonding of dissimilar materials with polymer brushes developed through a decade of research at Aarhus University, an epicenter for polymer brush research. This technology was highly impressive but not market-ready, so the period from founding until early 2019 was committed to arduous but exciting technological developments. Now, our formulations and coating procedures are matured and ready for scale up to the larger industrial market. We have since 2018 provided a coating service for customers requiring smaller series for high-end niche application, while we continuously conduct industry projects for clients targeting larger markets and series with implementation of our coating solution in their own manufacturing facilities. Our main growth focus now is on expanding our production capacity with flexible automated coating systems. With increased capacity of 20 times current level and projected drop in coating costs of at least 5 times, we can address larger market segments with better profit margins while simultaneously demonstrate our coatings at industrial scale – reducing the perceived risk for our larger clients.       

We completed a seed investment round in 2017, securing 648 000 USD from Borean Innovation A/S for our development activities and early product launches. This has been supplemented with around 2.5 million USD in soft funding raised together with our partners for the technological development. We are now targeting a funding round for Series A in 2020 for financing the scaling up of our technology and business to bring our solutions onto to the larger market.   

What is pivotal for your success going forward?

As mentioned previously, scaling up of our inhouse coating service to increase capacity and decrease costs are vital to increase revenue and move towards the larger markets. Simultaneously, we need to grow our organization by hiring critical new employees in operations and engineering to keep up with growing demands and support the scaling activities, while more resources in sales is of special importance. We currently have a very good traction with our technological development and growth in industry projects, so keeping up this momentum will be top on the agenda for the next years.

Can you provide some KPIs that helps understand the size and growth of your company?

Revenue from sales of our coating services and industry projects was 170 000 USD in 2019 (estimated by November), which represent a growth of more than 220% from last year and 430% from 2017. In the same period, we grew our staff from four to eight highly educated employees. With our scheduled increase in coating capacity, we project a growth in revenue to reach 640 000 USD for 2020. By 2021 we project to be profitable, and will this year also roll out our highly scalable license model and begin distributed sales of chemicals mixtures. Our unique highly valuable product solutions of carbon fibers sized for thermoplastics and functionally coated nanoparticles will reach market in 2021/2022. Long-term, we project a revenue of around 24 million USD already by 2024.

We are targeting the global market and already have many clients in Europe, North America and Asia. While the European market certainly is more addressable in short term due to geographical proximity and cultural similarities, we are already planning to establish smaller sales offices in North America and Asia within the next few years.

How can strategic partners from the chemical industry or financial investors contribute to your success?

We are targeting a Series A funding round in 2020 with a goal of securing 3 million USD, to support the scale-up of our production capacity with a line of automated flexible coating systems to service our growing list of clients. The funds will also be allocated to develop our business, hire new critical employees and set up sales offices.

From the chemical industry we are right now searching for bulk suppliers of our base chemicals, or even for more intimate partnership for joint production of our chemical mixtures.

However, we are also looking for strategic partners in other areas, including co-development for improved coating techniques, suppliers of industrial-scale coating systems – and certainly for potential customers of our technology. 

Who is the primary point of contact for investors and strategic partners?

• Mikkel Kongsfelt
• CEO
• [email protected]
• +45 91 91 91 10
• www.radisurf.com
• https://www.dhirubhai.net/company/radisurf-aps/

Disclaimer: The sole responsibility for this content is with the company profiled.

If you would like to profile your Chemical StartUp in this series, please reach out to [email protected]