Team:FCB-UANL/Entrepreneurship

 

FIREFIGHTING FOAM
BIOSURFACTANTS
UP-SCALING
FINANCES
FUTURE
IP
COMPETITIONS
REFLECTIONS
REFERENCES

In the context of raising concerns towards seemingly uncontrollable fires and the huge risk involved with polluting surfactants not only found on the firefighting foams used to combat them but in other products as well, we noticed that our project could lead to potential benefits for both society and the environment. Backed by our stakeholders' perspectives (for more information go to our Human Practices section), and the global trend on the migration towards more environmentally friendly products, we decided to develop entrepreneurial activities for the potential introduction of our product into the market. Such activities include the development of detailed business models and upscaling planification, participation in entrepreneurship mentorships and competitions, and, last but not least, events where we shared our reflections on bio-entrepreneurship.

The initial step on the path of constructing a solid entrepreneurship is the development of a detailed business plan. Alongside the business plan built for firefighting foam market by the iGEM FCB-UANL 2020 team (1), and based on feedback we received in several events, we decided to initiate further investigation on another market to which our project could potentially fit to diversify our scope: the biosurfactants market. Thus, in the following section you can find a summary of the firefighting foam business plan developed by FCB-UANL last year’s team and the further section directed towards understanding our potential entry into the surfactant market.

FIREFIGHTING FOAM BUSINESS MODEL

Our proposal aims to generate a first-of-its-kind, environmentally-friendly firefighting foam for AB type fires, obtained through synthetic biology techniques. The foam’s components are inspired by nature, since they consist of a series of proteins called Ranaspumins that come from a local species of frog, and of natural metabolites produced by the soil bacterium Bacillus subtilis. Further details related to the laws and application methods can be both seen in our safety and proposed implementation sections, as well as in the Business Plan found at the end of this section.

Considering a few, minor modifications based on the continuous feedback obtained from our stakeholders, the following Business Model Canvas shows a summary on the analysis and proposal the FCB-UANL 2020 team (1) did considering the firefighting foam market, which was continued to work on during this year. For a complete analysis including market trends, customer segments and other aspects, please consult the business plan elaborated by the iGEM FCB-UANL 2020 (1) and continued by us attached in the following document.

BIOSURFACTANTS FOAM BUSINESS MODEL

In addition to the research performed within the firefighting foam market, we decided, based on some feedback we received at different points throughout our team’s journey and also on the fact that many surfactants are petroleum-derived, to also conduct research on the biosurfactant market to determine whether our project could potentially adjust to this sector.

This decision was made due to the idea of being able to adapt our project to the current necessities it could cover. During our participation in several mentorship sessions (further described in this section) one of the most repeated questions was “what are you going to do with the technology if your foam is not a successful product?” Hence, we noticed we had to be prepared with an alternative plan to have a more complete scope of our business possibilities. Next, you can learn more about this alternative business plan.

MISSION AND VISION

Mission: Our mission is to develop and optimize the industrial production of biosurfactants and distribute them to the main users, to achieve a replacement of chemical surfactants that cause damage to the environment.

Vision: Our vision is to be one of the leading companies producing biosurfactants, in this way being a paramount example of migration towards eco-friendly products and new applications of biotechnology.

VALUE PROPOSITION

Value proposition: Synbiofoam aims to industrially produce biosurfactants, which tend to be more environmentally friendly and effective than chemical surfactants, using a novel approach through synthetic biology and bioprocess optimization. The value proposition is further illustrated in the following diagram.

MINIMAL VIABLE PRODUCT

In this case, the MVPs would consist of a series of biosurfactants whose presentation would depend but would mostly in the form of a dry solid material, often powder-like. Its production would comply with the appropriate normativity, such as that indicated in the safety section and other norms such as the NMX-Q-901-CNCP-2016.

CANVAS MODEL

SWOT ANALYSIS

S	W	O	T
Environmentally friendly products found in nature	Expensive research & development process	Migration toward environmentally-friendly society	Difficulty competing with chemical surfactants
Personalized customer service	Use of other equipment for industrial production	Gradual increase in biotechnology industry	Already established companies with greater capital power
Beneficial use of wastes from another industry		New legislations favoring less-harmful chemicals	Additional regulations to deal with when working with microorganisms and products derived from biotechnology techniques.

PEST ANALYSIS

P	E	S	T
Anti-GMO agenda in own country and others	Biotechnology industry yet to become an established industry nation and worldwide	Prevailing stigma around GMOs	Need for better approaches for industrial production to reduce affordability problems
Excessive or ambiguous regulations to introduce product into the market	Increased production costs on biotech products	Raise in awareness on harmful products can favor our proposition	Additional requirements on bioreactor design and steps on the bioprocess
Favoring of the chemical industry over emerging biotech products	Inflation and other aspects that would ultimately affect production costs	Trend in migrating towards environmentally friendly products must maintain	Synthetic systems to produce our products are yet to be tested

MARKET ANALYSIS

With a 4.5% compound annual growth rate (CAGR), the surfactants market is expected to continue its growth in the following years. Its value was established at 42.1 billion USD in 2020 and is expected to reach 52.4 billion USD in 2025. Besides, North America was the region that led the market in terms of value, and Asia and the Pacific in terms of volume (2,3). The following graph, retrieved from marketsandmarkets (2), shows the trend on the growth of the surfactants market.

In addition, due to the increasing demand for more environmentally friendly products, the biosurfactant market specifically is expected to increase at a higher CAGR, 5.6%, growing from 3.99 billion USD from 2016 to 5.52 billion USD in 2022 (4).

COMPETITORS ANALYSIS

The main competitors consist of the surfactant and biosurfactant companies established nowadays. Some of these include BASF SE, Evonik Industries AG, Stepan Company, among others (2), and can be predominant in the Latin American region as well (5). Besides, some of these companies, in addition to others such as Jeneil Biotech and Ecover, have increasingly been related to the production of biosurfactants (2,4).

Still, they are strongly focused on the production of a limited amount of biosurfactants, mainly sophorolipids and rhamnolipids. Thus, we intend to diversify the production of the types of surfactants, which can even achieve greater power such as surfactin, in order to offer a greater array of products which match the customers’ needs.

CUSTOMER DISCOVERY

The customers of the surfactant and biosurfactant market can be categorized as into different industries depending on the products or services they offer. With this in mind, some of the most relevant areas that stand out are the home and personal care industries, as well as the cleaners, food and oil industries (6).

BUSINESS MODEL

A complete business plan, including details complementing the previous information, can be found in the following document.

UP-SCALING PROCESS

DESIGN OF A LARGE-SCALE PLANT

A crucial step in the planning and determination of the feasibility of our project is proposing an up-scaling. Developing a scheme of this process would allow us to consider the financial data for the product production, the safety measures needed, our customers and end-users. Even though biotechnological products and the corresponding bioprocesses tend not to be cheaper initially than the established materials and methods, further optimization can grant our products a competitive price.

Thus, with the help of mentors such as Dr. Katiushka Arévalo, we have improved the previously reported upscaling plan with the objective of outlining the industrial process and estimating the production costs of establishing a production plant in Mexico while using agricultural waste as a way to reduce the estimated costs. To get an initial perspective of the total costs and to simplify the process mapping, only the ranaspumins and the surfactin, and not the biofilm were considered within the scope of this investigation. Still, these and other details are going to be included in a future to obtain a more robust cost estimation.

Following the methodology and considerations mentioned in our model section, and based on previously reported literature (8) and laboratory results, a production plant was simulated with the help of SuperPro Designer, which allows to incorporate some process characteristics such as the materials’ balance. As seen in the following image, the overall diagram depicts the proposed upscaling production process, which includes two production lines:

• A volumetric scale-up of a three stage fermentation system starting with a 10 liter shake flask and ending with a 1,000 L fermentor;
• A second production line based on a math model developed for predicting the behavior of the bioreactor process.

Based on the diagram previously shown, four well-defined stages can be identified in the production lines, similar to what has been described previously (9). First, the bacteria are grown in the appropriate media for them to be later inoculated in flasks of larger volume containing the culture media, which in this case correspond to the volumes of 10 L, 100 L and 1000 L, once the desired cell density was reached. After production of the respective components is achieved, these are purified and mixed to form the foam. Based on the predictions given by SuperPro Designer, the maximum amount of surfactant produced in each batch is 10.7 kg/batch, thus expecting an annual production of 604.11 kg/batch.

FINANCIAL ANALYSIS

Once we established the initial proposal for the production plant, we started to estimate the costs of the production based on the results obtained. With this in mind, the costs shown in the following table regarding the equipment are estimated. Those include the characteristics and acquisition cost of the main equipment used in the production process (2021 prices).

Name	Description	Unit Cost ($USD)	Total Cost ($USD)
SFR-102	Seed Fermentor Vessel Volume = 103.04 L	664,000	664,000
FR-101	Fermentor Vessel Volume = 1192.99 L	888,000	888,000
CY-101	Cyclone Rated Throughput = 13.21 L/h	3,000	3,000
CY-102	Cyclone Rated Throughput = 131.03 L/h	3,000	3,000
DS-101	Disk-Stack Centrifuge Throughput = 131.03 L/h	149,000	149,000
V-101	Blending Tank Vessel Volume = 569.59 L	237,000	237,000
BC-101	Bowl Centrifuge Throughput = 128.16 L/h	148,000	148,000
SDR-101	Spray Dryer Dryer Volume = 26.72 L	135,000	135,000
DS-102	Disk-Stack Centrifuge Throughput = 994.56 L/h	445,000	445,000
UF-101	Ultrafilter Membrane Area = 1.43 m2	38,000	38,000
INX-101	INX Column Column Volume = 603.99 L	81,000	81,000
C-101	GFL Chromatography Column GFL Chromatography Column = 22.91 L	229,000	229,000
V-102	Receiver Tank Vessel Volume = 25.46 L	68,000	68,000
	Unlisted Equipment		772,000
		TOTAL	3,860,000

In addition, we considered the total capital investment, which encompasses the direct fixed capital, working capital and startup costs (8). Overall, with the help of SuperPro Designer we estimated the Direct Fixed Capital Cost (DFC), which included the direct and indirect cost of the production plant construction along with other expenses, to be around $ 23M USD.

Total Plant Direct Cost (TDPC)	Cost ($USD)
Equipment Purchase Cost	3,860,000
Installation	1,439,000
Process Piping	1,351,000
Instrumentation	1,544,000
Insulation	116,000
Electrical	386,000
Buildings	1,737,000
Yard Improvement	579,000
Auxiliary Facilities	1,544,000
TPDC	12,556,000
Total Plant Indirect Cost (TDPC)
Engineering	3,139,000
Construction	4,395,000
TPIC	7,534,000
Contractor's Fee and Contigency (CFC)
Contractor's Fee	1,004,000
Contingency	2,009,000
CFC	3,013,000
Direct Fixed Capital Cost (DFC=TPDC+TPIC+CFC)
DFC	23,103,000

We then considered the annual operation costs, which is composed of the following (8):

• Labor Costs, the operator demand was specified for each specific operation with a basic rate of $40/h;
• Costs of the raw materials; wastes from other industries, in this case cane bassage, were incorporated in order to reduce the expenditure in this category;
• Utility costs; which consisted of the total involving standard electricity ($0.1/kWh), steam ($12/t) and chilled water ($0.4/t);
• Facility-dependent costs which included taxes and maintenance, and laboratory costs related to product quality supervision.

Based on the results observed, the following table summarizes parameters of the operation cost and revenue of the production plant, considering solely the surfactants.

Economics
Total Investment	$24,267,351 USD
Operating Cost	$4,527,276 USD per year
Total Revenues	$6,041,102 USD per year
Unit Production Ref. Rate	604.11 kg of Main Product per year
Unit Production Cost	$100 USD/g of surfactant

Despite the previous table showing that each gram of surfactant produced is expensive, it must be outlined that it lies within the sell price could be placed within the price ranges found nowadays in the market(8). Finally, the following table sums up the profit margin, return on investment, and payback time predicted based on the analysis performed.

Project Indexes
Gross Margin	25.05%
Return on Investment	12.79%
Payback Time	7.82 years

If an additional step is considered, where other potential components of the concentrate, such as water, would be added, then the following information corresponds to the case of the foams. As it can be noted, the expected total sell price of the product would approximately be of 400 USD per 20 L, which can fall within the range of the prices found nowadays for the foams.

Economics
Total Investment	$24,267,351 USD
Operating Cost	$4,527,276 USD per year
Total Revenues	$4,757,000 USD per year
Unit Production Ref. Rate	353,464 kg of Main Product per year
Unit Production Cost	$12.55 USD/kg of biofoam

Project Indexes
Gross Margin	37.25%
Return on Investment	36.65%
Payback Time	9.36 years

The construction of this model was useful to predict and understand the main components' production and gave us an approach to the industry. Yet it still largely depends on several factors involved in the demand of the product. Although the total investment needed, which refers to the production plant construction in its entirety, exceed $20M USD, an initial investment of $30,000 USD is needed to continue with the following stages of technology development, which includes additional experimentation, performance testing, entry into initial stages of upscaling, among other expenses.

FUTURE PERSPECTIVES

Having the upscaling process already outlined, the following Gantt Chart was developed in order to set a series of milestones to reach to progress through the different technological readiness levels for our project.

INTELLECTUAL PROPERTY

During our journey, we also started getting interested in the Intellectual Property that could be related to our project. Therefore, we decided to investigate the process of patenting biotechnology as industrial property within Mexican territory. As a contribution to future iGEM teams, we decided to generate a document in which a broad perspective of biotechnology in relation to intellectual property, and the procedure to follow to obtain a patent in Mexico. In addition, we thought that the contribution would acquire further impact if several Latin American teams also described their nation’s status in regards with this topic, which would help future iGEM teams to obtain a brief reference on the matter. Thus, we collaborated with UNILA’s iGEM team and iGEM Ecuador and generated the following document in which we analyzed the several laws involved.

COMPETITIONS AND COURSES

In order to adequately construct all of the previously established information around the business model and other aspects, we were enthusiastic to engage in different activities to develop our entrepreneurial side. Among them, stand out the following:

DL-101 INTRODUCTION ON INTELLECTUAL PROPERTY

New team members have taken the opportunity to continuously learn about intellectual property, as it is something that would add an increased value to our project in the future. This course has served as an option for the team to get familiarized with new concepts and international statutes involved with IP. Besides, it helped us think about the relation between biotechnology and intellectual property and ultimately set the foundations for the collaboration previously reported in the Intellectual Property section.

HUBCIENCIA EMPRENDE

HubCiencia Emprende is an annual, international entrepreneurship competition in which people from throughout Latin America present their projects. Besides it being a competition, an incubation process that lasted a week was offered to the best project proposals throughout the region. The guidance provided revolved around several aspects, such as the pursuit of linking one’s project to the Sustainable Development Goals, guidance on business plan elaboration, search for funding, pitch development, among other aspects.

Later, we presented our pitch to a panel of judges who allowed us to continue in further stages of the process. After advancing through the initial stage, we received the exceptional mentorship from Eng. Daniel Domínguez Gómez, who gave us advice on topics revolving around pitching strategies and comprehension of several other details to consider. With his mentorship, we advanced past the “battles” to finally getting to the semifinals, or the “knockouts” stage, of the competition. Despite not advancing to the finals, this and previous experiences we have had has helped us further develop our soft skills and mature our project proposal.

REFLECTIONS ON BIO-ENTREPRENEURSHIP

Besides establishing the proper investigation and getting enrolled in bio-entrepreneurship activities, we also wanted to share our experience on the matter and its relation to the iGEM competition. Fortunately, we had several opportunities in which we could do so, from which the following stand out:

PODCAST BIOEMPRENDIENDO

At the beginning of 2021, we were invited to participate in the 28th episode of a podcast named “Bioemprendiendo” which is hosted by Héctor Garza. In it we talked about the problem that we are trying to solve with our firefighting foam. Besides, we also discussed our experience as iGEM students that participate and get immersed in an international community of equally talented young scientists. The link to listen to it is available in our Communication section.

ENTREPRENEURSHIP WEEK UANL

As part of our efforts to promote entrepreneurship activities within our university, we participated in the first-ever Entrepreneurship Week UANL. As the name suggests, the event took place in a week, and several groups dedicated to entrepreneurial activities were involved. In our case, we introduced ourselves, our project, and our experience on iGEM, besides discussing how entrepreneurship and biotechnology are promising areas to exploit.

MENTORSHIP RECEIVED

Finally, we would like to specially thank Eng. Daniel Domínguez Gómez, for helping us delimit our ideas and improve our pitching skills; Dr. Katiushka Arévalo Niño for giving us initial orientation around the upscaling process and bioreactor considerations; and Juan Manuel Martínez Villalobos, who continuously provided us with advice and guidance throughout the process.

REFERENCES

1. FCB-UANL. (2020). Synbiofoam: a synthetic alternative to fluorosurfactants. https://bit.ly/3ASbSJH
2. Marketsandmarkets. (2020). Surfactants Market Global Forecast to 2025 | MarketsandMarkets. Marketsandmarkets.com. https://bit.ly/3ANmDgs
3. Mordor Intelligence. (2021). Surfactants Market | 2021 - 26 | Industry Share, Size, Growth - Mordor Intelligence. Mordorintelligence.com. https://bit.ly/30sfC8l
4. Marketsandmarkets. (2017). Biosurfactants Market Analysis | Recent Market Developments | Industry Forecast to 2016-2022. Marketsandmarkets.com. https://bit.ly/2YWSApz
5. Market ltd. (2021). Latin America Surfactants Market | Size, Share & Forecast to 2026 | Brazil, Mexico, Colombia, Argentina. Market Data Forecast. https://bit.ly/3j97obQ
6. Grand View Research. (2015). Surfactants Market Size & Share Analysis Report, 2016-2022. Grandviewresearch.com. https://bit.ly/3DRdEgl
7. Petrides, D. (2003). Bioprocess design and economics. In R. Harrison, P. Todd, S. Rudge & D. Petrides, Bioseparations Science and Engineering. Oxford University Press.
8. Czinkóczky, R., & Németh, Á. (2020). Techno-economic assessment of Bacillus fermentation to produce surfactin and lichenysin. Biochemical Engineering Journal, 163. https://doi.org/10.1016/j.bej.2020.107719
9. Pérez, A., Singh, S., Pérez, E., & Segura, R. (2018). Techno-economic evaluation and conceptual design of a liquid biofertilizer plant. Revista Colombiana de Biotecnología, 22(2), 6-18. https://doi.org/10.15446/rev.colomb.biote.v20n2.77053