Innomost raises €5M to replace palm oil, fossil fuels and food origin ingredients in consumer products
This Finnish startup upcycles valuable birch bark compounds to replace environmentally harmful ingredients in products from cosmetics to pharmaceuticals
Finnish startup Innomost has raised €5M to bring their birch bark innovation into new markets as a sustainable alternative for environmentally harmful ingredients in consumer products. The funding round was led by Metsä Spring Ltd. with Innovestor and angel investors joining the round. The round was completed with grants and loans from Business Finland as well as other public financing sources.
The funding will be used to set up a pilot plant in their hometown of Kokkola. Innomost aims to build a production facility capable of producing 20 tonnes of birch bark products per year by 2023. Capital will also go towards further R&D work, as well as growing their existing customer base in international markets. The pilot plant will be used to test and plan the process for the next industrial-scale plant.
Consumers want to use natural, renewable, and sustainable cosmetics that are good for them and for the world. The majority of ingredients and packaging materials used today, however, are made from fossil fuels, plastic, or palm oil, which are associated with many environmental and ethical issues.
Innomost develops and produces high-value bioactive ingredients from forest industry side streams that enable its customers to make groundbreaking innovations in the cosmetic beauty industry. By using birch bark side streams, Innomost can upcycle naturally occurring raw materials that would normally be used for energy production or other lower value purposes into high-quality products. The products are more environmentally sustainable, as they derive from a renewable carbon source rather than similar fossil fuel-based materials.
“It’s really a win-win situation. The raw materials for Innomost’s products are available in large volumes at a feasible cost. Our raw material originates from Nordic forests, not from lands that could be used for food or feed. We are on top of the new beauty trend for upcycling, zero waste and full-cycle natural cosmetics,” said Sami Selkälä, CEO and Founder of Innomost.
“We are very grateful to our investors for seeing the potential in our innovation. We have several other industries in our sights that can all replace negative impact products and materials, including pharmaceutical, technochemical, textile, and nutraceutical industries,” Selkälä continues.
Innomost’s current product portfolio consists of birch charcoal powder, birch bark powder, betulin, suberin and azelaic acid. These ingredients are perfect for innovation in all cosmetic product categories including skincare, haircare, body care, decorative cosmetics, and oral care. Azelaic acid, for example, is an effective solution for acne, which has exploded as a skin problem with the daily usage of face masks. Birch bark powder provides deep cleansing for skin and hair, replacing extremely problematic microplastics.
“Innomost is developing a business idea, in which birch bark, a side-stream of Metsä Group’s operations, is valorized to high-value products for the cosmetics and personal care industry. In other words, this is exactly the kind of development that Metsä Spring would like to catalyze. We are very much looking forward to helping Innomost reach its milestones and goals,” says Erik Kolehmainen, VP of Corporate Venturing at Metsä Spring Ltd.
Innomost’s birch bark products do not exclude any potential user groups due to their anti-allergenic properties as they don’t contain birch proteins, and they are 100% vegan. Unlike their competitors, Innomost’s products are purely natural, they don’t need coloring agents, and they can be produced on a larger scale, meeting their global clients’ needs.
“We have launched a couple of products in Lumene’s cleansing line with two different Innomost ingredients – Finnish birch bark powder to replace microplastics in exfoliating products and Finnish birch charcoal powder for the cleansing of oily skin. Our cooperation continues and we are looking for new ideas and solutions, especially for skincare,” says Tiina Isohanni, VP R&D and Sustainability at Lumene, one of Innomost’s clients.
“It is not only a question of ingredients. Lumene can also obtain expertise and experience from Innomost’s knowledge of wood chemistry and the wood industry. When combined with Lumene’s knowhow of formulating cosmetic products and evaluating product safety and efficacy, the cooperation becomes very valuable for both parties,” she concludes.
Innovestor Partner Myron Seto adds, “The market potential, particularly in cosmetics, is very sizable, and Innomost has developed a new industrial technology that can disrupt the global market supply. We look forward to tracking Innomost’s growth as they scale up production with its new pilot plant, displacing non-eco-friendly products with the use of natural betulin.”
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For additional information:
Press contacts:
Maria Svinhufvud
Co-founder and Sales Director, Innomost
+358 50 544 2788
maria.svinhufvud@innomost.com
Sami Selkälä
Founder and CEO, Innomost
sami.selkala@innomost.com
About Innomost
Innomost is a Finnish startup founded in 2016 that develops and produces high-quality and renewable cosmetic ingredients from wooden side streams. Our valuable bio-based products are suitable for a wide range of sustainable chemical industry innovations. For more information, visit www.innomost.com.
Metsä Spring
Innovation company Metsä Spring invests expertise and financial resources into initiatives with the ambition to reshape the forest-based bioeconomy, aiming to increase the value for Metsä Group’s stakeholders in the long-term. For more information, visit www.metsaspring.com.
About Innovestor
Innovestor is an early-stage venture capital investor also offering direct co-investment syndication opportunities and corporate venturing services. To date, the firm has a total of €123M across 3 funds and currently manages one of the largest private venture-backed portfolios in the Nordics, consisting of 95 high-tech companies in multiple fields of technology such as cleantech, consumer, enterprise software, health, industrial technologies, and life science.
Our aim is to be the best home for future Nordic success stories. At our core, we boost the success and growth of companies by giving access to capital, know-how, and networks by utilizing our unique ecosystem of co-investors and partners. For more information, visit www.innovestorgroup.com.
