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31: Synonym's Mission to Create a New Green Asset Class - Using bioeconomy to replace 50% of petrochemical products with Co-Founder Joshua Lachter

As a self-proclaimed biological maximalist, Joshua Lachter is dedicated to finding solutions to our earth's challenges through biological or synthetic biological processes. This is what brought him to co-found Synonym in 2022, a company dedicated to supporting the biological revolution by collaborating with both big and small companies to promote the use of bio-based products.

Joshua is currently the Chief Business Officer at Synonym, where he used his background in finance to help support the company scale-up. Synonym's mission is to create a bioeconomy asset class to enable the commercialization and manufacture of bioproducts. They envision a world where the bioeconomy can replace over 50% of the petrochemical products, and aim to develop this world by accelerating the transition to better, more sustainable materials through bio-production. Synonym is working toward this aim with funding support from groups such as Andreessen Horowitz, Blue Horizon, Thia Ventures, and other venture funds. They closed $6.3 million in pre-seed capital in October 2022, only 9 months after launch.

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What are biotechnologies?

Biotechnologies are technologies based on naturally occurring biological processes, which exist on the molecular, cellular, and organism level. These technologies aim to replicate and scale up the natural processes, to implement the biological solutions on a wider level. The applications of biotechnology are incredibly broad, from textiles, energy production, medical care, agriculture, and more! (Source: Processes commonly used in biotechnology includes fermentation, biocatalyzation, and more.

What is does Synonym do?

Synonym works with companies to scale and commercialize biotechnology products. They aim to support both new companies in the biotechnology innovation space, as well as existing companies who are looking to increase their use of biotechnology. Synonym provides companies with developmental and financial services, and works to match companies with existing production facilities and contract manufacturing organizations (CMOs).

In addition to this, Synonym has launched two free online tools to help companies with their journey: the first is Capacitor, a directory of the available bio-manufacturing infrastructure, and the second is Scaler, a techno-economic analysis and life-cycle assessment calculator that generates insights designed to help companies optimize their paths to market. (Source:

They recently released a report with the Boston Consulting Group (BCG) that sheds lights on the path of biomanufacturing in a few specialty markets to explode to $200 billion in the next decade. The full report can be read here:

The aim of Synonym is to grow the built infrastructure for the bioeconomy, making it more affordable, more accessible, and bigger. This is being done with the hope that it will shift worldwide production away from ineffective and unsustainable methods.

In this episode we address the following questions:

  • What is you mission at Synonym? 2:45

  • What are examples of how biology can replace petrochemical products? 4:40

  • How is fermentation used? 7:00

  • How is Synonym scaling up? 10:20

  • What does Synonym do? 13:20

  • Can you give an example of your work? 16:25

  • How do you de-risk for asset class comparison? 22:00

  • How do CMO's function in this process? 25:00

  • How do you finance this operation? 29:40

  • How did you end up in this sector? 39:00

  • How do you secure funding? 43:00

  • How long will your current funding last? 45:00

  • What does your next 24 months with Synonym look like? 46:00

  • How can people contact you? 47:00

  • What is your personal motto? 47:30

Memorable quotes from the episode by Joshua:

"The hope is to take the best of nature and scale it in ways that we simply can’t today, to create products that are simply superior to any chemical alternative."  

"We really believe that biology has the potential to satisfy a wider range of human needs and make us healthier and happier and just meet our needs in a better and more efficient way." 

"Today, we want these assets to be standardized and productized and marginalized so that they can they can grow and they can perfuse throughout the world." 

"I am a biological maximalist. I think that biology is the cause and solution to all of life’s problems."

"When we're looking for something better, when we're looking to say something in a different way or do something in a different way, we look for a synonym in the same way, we think that for the products we have today, we're going to look for synonyms. We're going to look for things that kind of look the same but better and we think that so many products that we use today are going to have bio manufactured synonyms created with synthetic biology."


Transcript based on AI and beta- status:

Narrator: 0:01

You are listening to Sustain Now. In this podcast, you will learn from successful entrepreneurs and scientists about the newest climate change solutions to address the climate crisis, from food and agri-tech over energy material innovation to circular economy. This nonprofit podcast is hosted by Frederica. She is a tech entrepreneur and climate enthusiast. You can find show notes and background information on wwwSustainNowch. Enjoy the show.

Friederike: 0:35

Welcome back to the Sustain Now podcast. I'm excited to be your host once again, and in today's episode we will explore the world of scaling bioeconomy to replace 50% of petrochemical products in the future. That is the bold vision of Synanim, a company dedicated to accelerating the transition to better, more sustainable materials through bioproducts. Joining us today is Joshua Lachter, co-founder and chief business officer at Synanim. With a background in finance, joshua brings a different perspective to the world of bio-manufacturing. He's here to shed light on the potential of fermentation and his role in revolutionizing our daily products, from food over chemical products such as lubricants or fibers, to special chemicals like enzymes or plant-based proteins. Synanim's mission is to create a new asset class, a bioeconomy asset class, to enable the commercialization and manufacturing of bioproducts. Joshua will walk us through the company's vision, the challenges they're addressing and the partnership they're developing to scale bioproducts on industry scale.

Friederike: 1:47

But before we dive into the details, let's take a moment to understand the magnitude of the problem Synanim is trying to tackle, from the high cost of production to the limitation of available current fermentation infrastructures. Joshua will guide us through the complexities of bio-manufacturing landscape and highlight the urgent need for scalable solutions. So if you're curious about the future of sustainable materials and the pivotal role of bioproducts in driving this transition. You won't want to miss the episode. With further ado, let's jump into the conversation with Joshua of Synanim. Happy listening, hello Joshua, welcome to Sustain Now. Podcast.

Joshua: 2:32

Hi, thank you for having me.

Friederike: 2:34

Today we will talk about replacing 50% of petrochemicals with biology by 2050. That was a astonishing quote I found of yours in one of the previous interviews. Can you maybe explain to my listeners how do you want to make that possible?

Joshua: 2:49

It is a bold vision and it sounds a bit ambitious. And it is a bit ambitious. There are hundreds of thousands of chemicals in use today across a very wide range of industries. The room you're sitting in, the room I'm sitting in the room any of our listeners are sitting in, are filled with all sorts of chemicals, often derived from petroleum or perhaps from animal products, but more often from petroleum, and they take so many forms polymers and resins and plastics and things like that and the truth is, a lot of them are fairly new, in the scheme of things, that they've only been around for, depending on the actual product, 25, 50, 75, 100 years, which, in the scheme of things, isn't that long.

Joshua: 3:33

And the truth is that, while these chemicals serve an extraordinary purpose of functional use they act as adhesives and coatings and waterproofing and all sorts of things they're often toxic, and both to us and to in their creation, and they often persist in the environment for hundreds or thousands of years and, worst of all, even worse than from an ecological perspective, they're not even that great at what they do all the time. And so when we talk about transitioning a world off petroleum, it's not only an energy story. It's about moving the stuff that we use, those industrial chemicals and, frankly, lots of stuff of our daily lives, to products that are better, to products that function better, to stick more, to hydrate more, to do all of the things that we need our industrial chemicals to do and that we rely on, but do them better and more ecologically soundly. And the way to do that to give you the answer that we're getting to anyway is through biology. We believe that's an enemy, that the way to achieve these kinds of new age of products is via biology.

Friederike: 4:43

I think most of people know by now biodegradable plastic or other things which may be a partly bio biology based, but I think you're talking about other products as well which maybe you can't imagine that you can replace them by biology. Can you give us some more examples where you think you can actually replace products in this room or in our daily life by biology?

Joshua: 5:08

Sure, there's sort of a bifurcation here in that you can think both of pure one-to-one replacement. So we pick up a cup that's made of plastic today derived from petroleum. There are cups today made via fermented, pha, fermented plastic that serve the same purpose. They're a cup that you can put liquid in but that truly biodegrade in a matter of weeks or months instead of a matter of tens of years or hundreds of years, and so those are one-to-one replacements. There's also products that simply don't exist today. So there's companies working. I'll give you an example on spider silk. So the actual proteins from spiders can be created via fermentation, can be created in a lab and through a series of other processes, spun into yarn and put into clothing. That's a material that previously was never available to humanity. This wasn't a product that you could ever harvest and many others.

Joshua: 6:08

I think part of the promise that we see that's the most exciting is that we'll be, for the first time, able to take the best of nature and scale it to our needs. So it could be the case that some species of endangered penguin actually produces a protein in their saliva. That's the best antifreeze ever. Just giving a hypothetical example, there's no way that we can harvest the saliva of a penguin at any scale. It would be madness. But you could take that protein if you could harvest a little bit. You could take that protein and produce it at scale and get all of the properties that nature has spent millions of years improving and bring it to all of humanity.

Narrator: 6:50


Joshua: 6:50

I think that's the extraordinary piece of this that sometimes people don't realize. The hope is to actually take the best of nature and scale it in ways that we simply can't today, to create products that are superior to any potential chemical alternative.

Friederike: 7:05

Yeah, that's super interesting because I think you mentioned fermentation and most of people who heard about fermentation primarily think about food, and you just mentioned another example where you can use the fermentation process to use protein to alternate into a different product. Is fermentation the core to that solution?

Joshua: 7:26

There are different processes that biology has developed for creating stuff and that synthetic biology is trying to replicate in creating other stuff, and so you've probably heard of cultivation, which is cellular agriculture, which essentially try and replicate whole pieces of tissue, and so these methods are extraordinary when you're trying to create a piece of bone, as certain companies are building or potentially growing organs or growing a piece of steak or a piece of chicken or a piece of fish. Companies are working on all of these extraordinary applications and I think most people believe there are pretty significant milestones scientific and technical milestones to overcome before we really are able to produce that kind of tissue at scale, cost, effectively. Fermentation is another kind of biomanufacturing, and the advantage of fermentation is that you're using and essentially leveraging cellular machinery that has existed for hundreds of thousands and millions of years and that humans have used themselves for many thousands of years. Everyone's familiar and I know you've referenced on the podcast before everything from beer and kombucha and kimchi and all of that. Humanity realized very early on that microbes were their friends and they could leverage them to create beneficial product and precision fermentation.

Joshua: 8:49

What you're referring to as fermentation has way wider applications than just food, though In the same way that you can think of, if you think of biology as a programming language, if you think of DNA as a kind of thing to code, then you can code microorganisms to basically make anything that the idea of fermentation in this generation is to say, hey, living things need to consume stuff, and then they metabolize and then they could spit something out again. To grossly oversimplify, we have a lot of stuff, we have lots of carbon, we have lots of biomass, we have things that microbes are already eating. Can we leverage those microbes to make things that are beneficial to us, that are value added? And so some of those things are food, but they could be things like spider silk, like polymers and resins, plastics, all sorts of surfactants, all sorts of things that are ubiquitous in our daily lives but that you can program microorganisms to produce. And so it does go way beyond food, and it should, because we use lots of stuff in our daily lives that isn't just food.

Friederike: 9:58

It's exactly like when I just had a podcast with no one who's creating synthetic methane with microbes and it's very fascinating that you can have, like I was very surprised to fertilize this and everything like that is based on fossil fuels and how much you can create already based on biology that you can recreate what biology is already doing. But I think the biggest challenge what I've seen so far speaking to a lot of different other companies is scale Like how can you really make that to this 50% of petrochemicals with biology? That's a bold statement and maybe then we come to that what problems you are solving, which is a lot about scale, I hope interesting. What is synonym doing to actually help to help that transition to biology producing a lot of our daily goods?

Joshua: 10:53

We believe that more and more of our stuff will be bio manufactured. We hope that it's 50% of all chemicals and a meaningful percentage of alternative proteins. So much of the stuff that we use should be bio manufactured, for not only ecological and sustainability reasons but, as importantly, for functional reasons. Humanity has always and continually tried to replace the stuff it uses with better stuff. That's just sort of what we do as humans. We're always looking for a better way of doing things to meet our needs, and we really believe that biology has the potential to actually satisfy a wider range of needs and make us healthier and happier and just meet our needs in a better, more efficient way. So we believe that we're on the cusp of so many of these products needing to be produced at scale that will be in the stuff that we use in our daily lives, and the infrastructure to produce that simply doesn't exist today at the scale that's needed to produce those economically, and so synonym is building that infrastructure. Synonym is building the physical infrastructure to bring those products to market, the actual bioreactors and facilities to bring those products to market. Of course those facilities are expensive. More importantly, it's sort of presumptuous to build those facilities without first making sure that the companies that will be using those facilities have hit all the milestones that they need to hit in order to produce at scale economically. And so synonym works with any company wanting to bring a bioproduct to market.

Joshua: 12:33

Sometimes these are very small companies several folks in a room as a lab spinout who have a strain that makes a lipid or a protein that does something Amazing To very, very large Fortune 1000 companies who realize that their supply chains need to change. Whoever wants to bring bioproducts to market need to understand the products that can affect their supply chain, need to plan from a techno economic perspective what production will look like and then need to sort of hit milestones and benchmarks as they scale up in order to hit a steady state where they could produce industrially at scale. And synonym wants to be their bioproduction partner at every stage of that to bring those products to market. We know that as the industry matures there will be lots of players at various stages of that scale, but that's healthy, that's a sign of a maturing market. But for right now there's lots of companies knowing that they want to do something in biomanufacturing but not sure where to start or how to do that, and we want to be there, sherpa.

Friederike: 13:35

So it's kind of a mixture between consulting them like what kind of milestones and what kind of KPIs you need to hit to actually make it on scale and at the same time, helping them to find production facilities or help them to build them. Is that a good summary?

Joshua: 13:52

When we first started the company, we launched two digital products as a way, as a service to the market. The first was called Capacitor, which is the most comprehensive global directory of existing fermentation capacity. It's a way for companies who need to find capacity to understand what's out there and what's available. And the second product we launched was called Scaler, which helps companies understand their basic technorachonomic modeling, some lifecycle analysis of their product within a very back-of-the-envelope way to begin to sort of understand the milestones that they need to hit as they grow. And so we launched these two products and it became clear that there was a real need for the industry to level up, if you will, to really go from lab stage, where people were talking about visions and prospects, to actually building things at scale.

Joshua: 14:45

That that is a real chasm. The chasm that is probably most analogous is in pharmaceuticals, where people talk about the valley of death, which is generally described as this terrible gauntlet that every drug company has to go through, where they have a really interesting drug but then they have to go through phases of clinical trials and extraordinary expense and complexity, and 90-something percent of them fail to do that. That's the so-called valley of death. In synthetic biology you have a lot of that same complexity and years of development and refining of a biological process without the prospect at the end of it, like with pharmaceuticals, of selling a life-changing drug for tens or hundreds of thousands of dollars. So you have pharma like complexity with commodity price returns. That's scary and that's really hard to do. And so, to answer your question, we work with companies at various stages, certainly on a kind of advisory basis At first, but also realizing that our goal is always to put them in the most economic capacity, and sometimes that capacity will need to be built, and we want to be building that capacity as well.

Friederike: 15:54

Okay. So maybe let's make an example. Like I'm, let's say, in plant-based egg producer, so I want to create we have fermentation process egg ingredients, egg replacement ingredients for big B2B companies who are creating pastry or whatever like that and I you know so far at least what I read about, and please correct me if I'm wrong that many struggle to even come across like this 1000 liters or bigger capacity, and not only because there's not the tanks or the actual capacity there, but it's also that many of these products don't have the stability of actually creating more volume.

Joshua: 16:39


Friederike: 16:40

How would you help me, like if I would be that company, how? How could you help me to find a scale? So I have a product which is working, which is maybe already in the pilot phase with a big producer, and now I want to scale it. How could you help me?

Joshua: 16:55

It's probably worth starting with the fact of why would we want to create egg protein via fermentation instead of from the chicken? And it starts with this idea that today, when you eat a croissant or a pastry that has egg in it, the idea is that a chicken laid an egg that hatched, that grew up to be a chicken that laid more eggs and eventually, right, you have. You take this, these eggs, and you turn them, you process them in some way and you turn them into a dry powder and you have like protein powder and that goes in various foods. It seems sort of inefficient and the and, truthfully, in our industrial agricultural system, the nutritional value of that egg might not even be that high at the end of the day, and so or maybe even taste that good. And so can a better alternative be created that has all the nutritional and functional properties of egg protein without any of the certainly the ecological and moral side effects but, as importantly, with a better nutritional profile and sort of equal cost profile? And that's really hard. And you're right. You asked sort of how do you, how do you get there? The obvious way to start is in a lab and then you hit, as you say, various milestones. A thousand liters, which you mentioned, is generally considered pilot scale. So that's hey, you're producing at a decent volume, but you're not producing very much actual product. It's enough to have some samples, but you certainly want to move to so-called demonstration scale 25,000, 100,000 liters, where you're producing much more product at a much lower unit cost, and then eventually to true industrial scale, which, again, depending on the product, is several hundreds of thousands of liters, where you're hitting your economic sort of steady state. If you will, or you can, sell at market rate.

Joshua: 18:53

All of these products, including a protein, have a market rate. Egg protein sells for, call it, $30 a kilogram or $40 a kilogram, whatever the market price is, and despite even functional superiority, fermented egg protein, just like any fermented product, ultimately has to reach parity with whatever the incumbent product petrochemical or animal based that it's competing against, and it has to compete not only on cost but also on functional superiority. So, you're right, it's a very ambitious goal, but the idea is that if you can hit these milestones at higher and higher sizes, you can demonstrate that, hey, we can produce at industrial scale. There is a final chasm that you have to cross, which is to say, hey, we can't truly demonstrate that we could produce at steady state at a certain price point. Until we do it.

Joshua: 19:48

And that's a bit of the vicious circle that the industry is confronting. The largest companies in the world for food the Nestleys and Denons and Unilever's and all the rest wanna bring these products to market. And you might have seen briars ice cream in the United States it was always in my freezer growing up. Just released, just released fermented ice cream which is a big milestone for the industry. These companies wanna release these products but they're really large companies and they have to be constantly aware of the quality and also the cost implications of the products that they're putting in their supply chain. And so it's hard for them to take these bats on fermented products until these products truly been demonstrated at true commercial scale for a period of time. Very hard to demonstrate true commercial scale without a bunch of money to put steel on the ground, to produce, to build a facility that's optimized for that scale. And if you can't get the offtake to produce that, to make that facility, you can't convince the offtake that you can do it.

Friederike: 20:51

And so that vicious circle mean the chicken and egg problem.

Joshua: 20:55

The chicken egg, so to speak, as play the industry. And that's where we come in and we wanna say hey, for both the potential off takers and for those producing. The functional and amazing aspects of your product Are awesome, but if you can't produce it at scale and at cost, it doesn't matter. And we wanna work with companies who are at various stages but who really are ready to cross the commercial casin. Help them do that, help them Underwrite the actual facility to produce at scale, and work with also who would say on the other side, financial community who I think is hungry for new green asset classes, who, you know, infrastructure investors and other other kinds of investors who Understand that we need to build new clean asset classes.

Joshua: 21:45

And there's obviously wind and solar and that's great and folks are working on nuclear and lots around the energy transition, but the materials transition is just as important, and the way we're going to bring these products into our supply chains and actually begin to Chip away at our, at our climate goals, not to mention the sort of health Improvements that we want for ourselves, is by building infrastructure to produce these products at scale. And so we want the financial community to view Large scale precision for information infrastructure as an asset class, the way they would you a solar farm or wind farm or a data center. Today, we want these assets to be Standardized and productized and marginalized so that they can they can grow and they can perfuse throughout the world.

Friederike: 22:33

How do you want to do the risk it if it's like an asset class comparison?

Joshua: 22:38

It's very good question. It's not easy to establish a new asset class. They're not in real estate, they're not established all that often. Our answer is is largely about standardization of the facilities. So when you think about, when we talk about fermentation and I know you've had others who you do synthetic biology on the podcast, talk a little bit about this you from a very broadly, there are two steps. There's so called upstream, which is the actual fermentation, so you have a Easter bacteria eating some feedstock often it's glucose or dextrose and then producing something, say, an egg protein or a dairy protein or a resin or a polymer, whatever it is that fermented. That's so called upstream fermentation process is pretty standard as it happens in very large what are essentially that's bioreactors, and they vary in size, but industrial ones are, say, a hundred fifty thousand liter, so quite large. They sit outside and they can sit outside. And that's pretty standard as, regardless of what you're making and again, you can make everything from their protein, protein to drugs ozampic, which is the most famous drug, I think, probably in the world at the moment, is precision fermented and made in roughly the same way.

Joshua: 23:55

What happens then? And is very dependent on what you're making with a pharmaceutical alternative protein or whatever it is Is the so called downstream, the dsp, the downstream processing, and that involves a whole bunch of steps that are very dependent on the product and specifications, for the product Tends to include things like filtration, spray drying, other kinds of processing steps, but ultimately that's what you get it and at the end of that you get the product that you can sell, and so the upstream piece of it. When talking about standardization and financing, the upstream piece of it is fairly standardize, it's that's, and that looks pretty much the same wherever you are and whatever you're doing. The downstream is is obviously much more bespoke, depending on the specific process, and part of what we think a lot about is how you create the right Array of downstream equipment to satisfy the largest potential user base and that's.

Joshua: 24:55

That's a hard question. There's several different approaches to it. Are is essentially to try and make design decisions that Really do cover the largest percentage of synthetic biology companies possible and create mechanisms to accommodate either new and improving technologies or when different tenants in that facility, different users of that facility, and so there's a degree of over design, you might say, or thoughtfulness about new users that factors into our design and ultimately will result in fermentation facilities becoming Asset class, that you can have an asset class if it's not Somewhat standardized. That it's not an asset class, that it's a what, it's a one off, and we very much know that this needs to become an asset class so you would like, coming from you know my, my background in retail etc.

Friederike: 25:53

It sounds like a lot like you want to be like a white label manufacturer, like saying, okay, what kind of Production over what kind of products you can produce, and whatever it is for whom, is long as it's caters, let's say, 95% of the same specifications. You can, of course, use the same facilities and scale it over that and it's to be customized at the end of the supply chain. Is that to simplify it for that, or is that kind of where you want to head to?

Joshua: 26:23

In food, for instance, there's a very, very mature market globally of so called copacers who do exactly as you say. I want to make an energy bar or A certain kind of drink or a frozen meal. I can go to any number of them who specialize in frozen meals or energy bars and who could work with me to develop something to my specifications. That doesn't really exist in synthetic biology. At the closest analog is so called cmo's or cmo's, which are essentially the co manufacturers who have facilities, who work with the technology companies to produce a scale as contract manufacturers and we're not necessarily ourselves a contract manufacturer that Contract manufacturers are extraordinary partners for us. They are such an important part of the ecosystem where, if you're scaling, growing as a symbiocom, and you need to, you need to produce a contract manufacturer. You need to produce at at one of these facilities in order to Prove out your technology and learn and improve and all of that. So, so those exist that there aren't that many new ones coming online. Mark or the ration labs and his team are doing an amazing job. Bring one online, indiana, hopefully later this year, early next, but there aren't really that many new ones coming online and I think that there's, in general a dear of cmo's synonym wants to sort of be a step removed from that.

Joshua: 27:55

As you, most often companies graduate from CMOs. So again, because CMOs serve a very wide variety of customers, you tend to sort of produce it CMOs for a period of time and then want to move on to your own facility where you can get better economics. And again, it depends on the product. Certain fermented products you don't need to produce very much of and you don't need very much product that, given the value of it. And so for those kinds of products CMOs are great. But there are certain kinds of products you mentioned egg protein you need to produce a lot of protein at the scale of tons and tons, and tons.

Joshua: 28:34

And it's very hard to do that economically at a CMO, and so you have to look to building a facility that's optimized and that can really operate at the scale to hit your targets. And that's really where we come in, at the true commercial scale, where you say, okay, there's demand for tens or hundreds of tons a year of my product. It's been proven out it could produce. At this stage it's ready to go. It's a true industrial process and we need a true industrial facility to get it done.

Friederike: 29:08

And I think you mentioned before, like you know that, exactly that green premium. In the end, you need to have exactly the same price as an industrial scale or an you know, let's say, produced by a chicken, which is extremely cheap, produced in that sense, the egg protein and the end state needs to be that you are having priced parity between the original and the actual plant based or from intended product. How do you like I think you mentioned that before is you have to finance that coming from the pilot one to a demo plant or like even a bigger one? How do you do? How you do that that you can pre finance together with a startup or together with a little bit more mature company? How do you do that? Then, actual this financing to make sure that this plant is actually getting built, and then you know, of course, needs to need to run as well. How does that look like? How do you, how do you finance that asset class?

Joshua: 30:07

We haven't yet built a facility, so I'll caveat. I'll caveat this with. This is how we're operating and this is the strategy we're taking, but it hasn't been fully proven out yet. We intend to finance, as we would, other asset classes. So the last 10 or 15 years have seen the profusion of many novel and new facilities being built across primarily the energy sector. There's in the United States there's a very mature infrastructure and asset class around ethanol facilities. There's something like 150 ethanol facilities in the United States as a result of congressional measure in 2005 to to catalyze that industry. And so we would hope to take a similar playbook as has been used for the development of other classes. Which is to say, if there's a degree of, if there's offtake, if there's demand for the product being produced and a technical de risking, so if process being described is technically feasible and technically proven at that scale there's demand for it, then we can project, finance that facility. We can get the kinds of investors who invest in other real assets to invest that facility and see a return from, essentially, these payments from the users of that facility. Those these payments are being paid from the sales of the product being produced. So it's not a totally novel structure. It's never been successfully applied and scaled in biomanufacturing and it speaks to the masonry of the industry. It's just it's early and we're trying to bring this industry to a place where that can happen.

Joshua: 31:48

The good news for Drige, which I think some people forget, is that we only need a couple of milestones for there to be an overcoming of that kind of vicious circle that I described. So if the vicious circle that I described is, it's very hard for companies to get offtake because they can't prove that they could produce at scale and so they can't get funding for the actual infrastructure to help them produce at scale and hit cost parity, the opposite can also be true, in the sense that, or the solution to that can also be true in the sense that if a few large companies make these commitments, as we think they will in the coming months and years, and say I want you mentioned egg protein, but I want collagen or a resin or polymer, these are huge, huge companies that are making the products that we use in our daily lives and again, a lot of these products are petroleum based or toxic to a degree. If those companies start saying, hey, I want to make a commitment to a fermented product in my supply chain. At scale, and because I'm a Fortune 1000 company, that equates to thousands and thousands of ton the next day. The thing that happens is all of those companies, competitors, feel like they have to make a similar commitment, and so on and so on and so on.

Joshua: 33:01

And once you get that kind of domino effect, you can see that the demand side, the actual offtake side, begins to crystallize. And once that happens, our hope is that and our belief is that as these companies start making these commitments and make firmer commitments to offtake, the technical milestones are being hit and improving every month and quarter and year and so we'll have what we need to actually get facilities financed. And again, once you have these products more ubiquitous in the market, once there's egg and collagen and PHAs on the market people are using and become the default and prefer for the functional superiority, for the health reasons then they'll just be a kind of virtuous circle instead of a vicious circle, where it becomes really easy to finance facilities because there's lots and lots of demand for the product coming out of those facilities and there's lots of money for companies to improve their strains and improve the yields on their strains and so the whole typical industrial process of functional improvement and price falling begins to kick in, and then we're off to the races.

Friederike: 34:19

Yeah, interesting. I think in the last two years, or let's say the last few years, there has been quite a run on alternative protein companies. I've seen a little bit of cooling down now that some investors lost faith in alternative proteins and fermentation. Do you see that similar or do you think that's just because it has been so high valuations and now reality kicks in and now we are ready to scale on a healthy level?

Joshua: 34:47

Certainly in 2020 and 2021, maybe some of 2022, there was certainly a frenzy in a euphoria around all things tech, but synthetic biology was a huge beneficiary of that, and there were large funding rounds and very high valuations that companies are still trying to get their heads around. I think the funding environment has obviously changed and some of the excitement about fermentation has abbed along with valuations coming down, but I don't think the underlying excitement around fermentation's promise and the ability to get into supply chains has gone away. If anything, it's only accelerated, and so there's a couple of factors behind that. One is a lot of government support. So only in the last couple of years has the US government and lots of other governments UK, china, brazil, singapore, saudi Arabia there have been lots of countries that have signaled their commitment to bio-manufacturing, and only in the last few months really have there been meaningful financial commitments behind that. So I think one of the really wonderful tailwinds that we're seeing is, yes, there's been perhaps a little less investor appetite, but some of that's been supplanted by government stepping up, as they should for this kind of new technology, to support this technology. The second tailwind that we're seeing, which is very excited for the industry, despite the macro trends is that corporations are finally waking up. Large corporations are slow moving in general, and it takes them time to wrap their heads around new technologies and disruptive technologies, but once that shifts, once someone in an organization on an executive level feels like they need to be responsible for something or else they'll lose out to a competitor, then the whole framework begins to come together. That once corporations begin to make these commitments and I think we'll see more announcements in the coming months and years the investors will follow and so there might be a momentary pullback from investors that mirrors the larger pullback. But I think that we're in the very, very early innings of companies realizing how important this is to them.

Joshua: 37:07

The analogy I would give is in the late 2000s. I hate saying the odds. A lot of people say the odds, but that never sounded good to me In the late 2000s. The late 2000s doesn't sound great either, but with the rollout of AWS, amazon Web Services, there was just the first in clings of cloud. And what happened very soon after I think it was in 2010, the consulting firm Capgemini coined the term digital transformation this idea that any company that wasn't thinking about how to interact or digitize its operations would be left behind. And in the 10 years or I guess 14 years since then, we've seen an extraordinary movement, obviously, towards digital, and cloud has been a huge beneficiary of that, and there's no company in the world that doesn't in some way think about how the internet, or digital broadly, whatever that means affects their operations, regardless of what they do. And that's been a very rapid shift in the scheme of things.

Joshua: 38:01

And we think that a similar kind of a similar kind of realization will happen for supply chains with bioproducts that Only now are we beginning to talk about and spread the gospel of the material transition in bioproducts. But once companies begin to really adopt this and embrace this, we'll see a huge stampede towards putting these products in our supply chain. We just released a report with BCG, with the Boston Consulting Group, that we're very excited about a couple of weeks ago that talks about the very near-term opportunities, particularly in specials to chemicals and alternative proteins, for companies to move these products into their supply chains. We predicted a $200 billion opportunity by the end of the decade. That's a lot of money and I think companies will realize that they need to have, regardless of what they do, whether they make windows or cars or cosmetics. Whatever they do, they'll realize that some part of their supply chain can be improved with the addition of bioproducts, and that will be a really extraordinary moment for the industry.

Friederike: 39:08

I like that analogy, what you just did like digital revolution and material revolution. I think material is not only what you said in the chemical part. It will be one of the most important parts in transitioning whatever energy or food or whether we are, material is going to be the base for every revolution, what's going to go ahead. I think I really like that analogy of you Coming back to you, joshua how did you end up in this sector? Because I think you've done something totally different before.

Joshua: 39:39

I have a background mostly in finance and finance adjacent, and more recently in artificial intelligence, so I never worked in biotechnology before I had invested in several companies in the space.

Joshua: 39:50

I think biology is an extraordinary force and a unique thing in the universe, so we don't have to fear it towards religion, but I do think that there is something just fundamentally extraordinary about biology. I've always been really attracted to it. To me, the idea of being able to enable and empower this new generation of synthetic biology companies, these hundreds and hundreds of companies that are working to bring these products to market, is amazing. And I think my co-founder, ed Chendurovich, and I were actually walking literally walking through the woods a little more than two years ago and talking about the ways that we thought that biology was going to revolutionize so much of industry and we wanted to find a way to be the picks and shovels to provide services and enablement to that industry. And we're more excited today than we even were two years ago when we started the company about the prospects of the industry and where we go from here.

Friederike: 40:46

So that was your pivotal moment walking through the forest and thinking about it.

Joshua: 40:50

That was a pivotal moment. In starting, I was a very, very small angel investor in a company called EpiBone about 10 years ago. It's an amazing company that grows bone, that takes fat cells and grows bone, with an amazing founder named Nina Tandon, and getting to know her and the company for these years as they've progressed has really shown me the power of biology, that here, just from a few cells, you can ultimately grow bones to implant into humans, and that idea was so powerful to me and I just became a believer that biology was going to solve so many of our problems, and I'm so thrilled that there's now a whole ecosystem of companies bringing these products to market.

Friederike: 41:33

Fantastic. So is your co-founder has a background in that, or are you both coming?

Joshua: 41:38

from totally different backgrounds.

Joshua: 41:40

He has a background across a lot of things. He's been an entrepreneur for a couple of decades in the food space, in the technology space. He had actually personally invested in several of these synthetic biology companies. Some of the CEOs he was talking to of companies he invested in were saying hey, we have this big problem where we have an amazing product, we have demand, but we can't seem to find a economic path towards scaled production. This is our big problem that we have to overcome to get our product to market.

Joshua: 42:13

We really sort of that kind of experience informed the founding of Synonym, because it's a weird name. But I should probably explain. When we're looking for something better, when we're looking to say something in a different way or do something in a different way, we look for a synonym in English and we'll often right click in whatever word processing program we're using and look for another word or way to say it. And in the same way, we think that for the products we have today, we're going to look for synonyms. We're going to look for things that kind of look the same but better and we think that so many products that we use today are going to have bio manufactured synonyms created with SYN, Synthetic Biology, and that's why we named the company as we did, and we're very excited about what's to come in the coming years.

Friederike: 43:01

Nice, I like that. I think my husband, who's Swedish, would exactly say the same thing about German language. He's always like when I use a word and then he's like, so what does it stand for? And then I say it's stand for this, but does this? This is, I thought it means this like yeah, it also means this, and it's like okay, german language is very confusing. There's a lot of synonyms, so I think very much like that. You 2022,. You raised money from Anderson Horowitz Congratulations. I think it was over 6 million. Two questions on that. What has been your secret to win them? I think many, many want to like to have them on the cap table. How did you convince them?

Joshua: 43:40

Well, Anderson Horowitz was part of the so many we raised from them and several other investors who were also excited about Giant and Tia Ventures and several others. I think Anderson Horowitz is an extraordinary firm for so many reasons. The partner who we worked with was David Haber, who really sits in the FinTech team and who has been a friend for many years. So it always helps to have a friend. But I think Anderson has a thesis, sort of two theses that were relevant to us. One is a really bold thesis around biology and biology's power to transform the world, and also a thesis around American dynamism that America, for many reasons, should be the engine of creating next generation technologies and domestic manufacturing.

Joshua: 44:30

I think we're all seeing in the last year the consequences of not having domestic manufacturing infrastructure for critical technologies like semiconductors, and certainly 30 or 40 years ago we had that manufacturing structure here. We had the opportunity to scale that infrastructure here and we didn't. We allowed it to move offshore and I think we now, at this critical moment, have the ability to build this critical infrastructure in the United States and we believe that we should. We need to for matters of supply chain resiliency, national security and just. America is a great engine of innovation, and that's what historically been. The chemical revolution happened here. The synthetic biology revolution should be powered here as well. We have a lot of the stuff we need. We have cheap energy, we have a great workforce, we have lots of feedstock in the form of foreign Makes sense for it to happen here, and I think our investors are equally excited about those prospects.

Friederike: 45:28

So you've raised 6 million 2022. How long will it last the money?

Joshua: 45:35

Well, that's the amount that we announced, so we're well funded. We think that we have the money and, more importantly, the team of capital markets and engineering folks that we need to execute on our vision in the coming months and years. So, as we build facilities, as we get to the point of actually building facilities, we're going to need to raise real money in the form of project finance, as we talked about, and that will be hundreds and hundreds of millions of dollars, and those will come from different kinds of investors than the ones who invested in synonym, but ones that really also believe in the power of this new paradigm.

Friederike: 46:09

So what does your next 24 months look like then?

Joshua: 46:12

We hope to announce our first facility later this year and we're very excited about that and there'll be lots of work that goes into that. We're still a pretty small team of fewer than 20 people. We hope to announce our first facility. We hope to announce some of our larger facility designs which we'll be public with, and just to continue to work with customers who, across the spectrum of sizes, if you will, from startups to very, very large companies who want to bring bioproducts to market. So we want to talk to you if you're, again, a small company that has proven your business to bug it a thousand liter scale. Or we want to talk to you if you're Dauer, dupont or Nestle, if you're a huge company that's looking to bring bioproducts into your supply chains, because we want to help you there. So we want to hit milestones in the number of companies we're working with to develop a road.

Friederike: 47:03

Primarily in the US? I guess Primarily in the US, in Europe as well, in Europe as well Okay.

Joshua: 47:08

We're equally excited about Europe. We think that Europe has a huge synthetic biology ecosystem. There's lots of government support. We think that there's a lot to be done in Europe and we're excited about our partners in Europe as well.

Friederike: 47:21

Interesting. So if people maybe listen now into it like either are in the food tech space or producing something interesting or are investors, how can they reach out to you?

Joshua: 47:31

We just launched a new website at Synonym S-Y-N-O-M-Y-M, if I misspoke therebio, and so our website's great. There's contact information there and there is LinkedIn. We have a great LinkedIn presence and would love for folks to follow us there for biomanufacturing news and lots of ways to get in touch.

Friederike: 47:57

So what's your? Do you have a personal motto, like a personal mission you would like to share?

Joshua: 48:03

Relevant to this. I am a biological maximalist. I think that biology is the cause and solution to all of life's problems. Sort of like Homer Simpson and beer.

Friederike: 48:15

Exactly, I know that Beer is the common solution.

Joshua: 48:19

So I sort of believe the same thing with biology and I think it's an extraordinary medium of creation.

Friederike: 48:25

Fantastic. I think that's a very nice last statement to this episode. I really enjoy talking to you and I wish you all the luck for the first infrastructure you're going to build up. I'm very excited to follow you further and I wish you all the luck and thank you so much for joining.

Joshua: 48:45

Thank you for having me. Thanks for the invitation.

Friederike: 48:50

Thank you for joining today's episode. You can find the show notes, background materials and contact details of our guests on our website, so staynowch, follow and share our podcast on any platform available. Do you have a comment or interesting solution to take a deep dive? Please don't hesitate to go to our website. So staynowch and write us an email.



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