The A.I.M. Interview: Algaeventure System’s Ross Youngs

On March 10, 2009, Algaeventure Systems, Inc. (AVS) announced a technological breakthrough for one of algae’s major road blocks, getting algae out of solution—harvest and dewatering. In the recently introduced Department of Energy ARPA-E project, the DOE described the AVS system as a “potentially transformative innovation” as it made its debut in the algae industry.

AVS was developed within Univenture, a company that has appeared on Inc.’s List of the 500 Fastest Growing Companies five times. In October 2009, AVS was separated as an independent corporation. I caught up with Univenture and Algaeventure Systems Founder and CEO, Ross Youngs, in his corporate headquarters in Marysville, Ohio, where we talked about his business philosophy, his AVS harvester, and his vision of where the algae industry is heading.

Q: When did you first become aware of algae as a potential energy source?
A: I learned a lot about algae in the mid-70′s, going to the Florida Institute of Technology, but didn’t have the realization about its full potential and what it really could do. As a company focused on developing the most practical and ecologically-friendly packaging, we began exploring biofeedstocks for plastics. As we explored many bio-based sources, we realized bio based plastics were not going to come from terrestrial plants. You can’t get enough of it. Jim Cook, our Director of Project Development did some research and, pulling a graduate move, said one word, “Algae!”

Algae processing at AVS.

Q: After digging deeper into the subject, what conclusions did you draw?
A: Algae has remarkable characteristics. It is a very efficient organism that can be grown in significant volume to provide food, feed, plastics, fuels, etc… We have only begun to unlock the potential of algae. Within fifty years of the true commercialization of algae as a biofuel, it will be a larger industry than the consumer electronics and the computer industry combined because we are talking about fuel, food, feed, fertilizer, nutraceuticals, pharmaceuticals, plastics, and chemicals. We’re talking about a spectrum of new, high quality, sustainable products that will drive this industry to unbelievable heights.

Q: How do you see this taking place?
A: When starting out, we’ve got to find the most opportunistic, highest value products first. The economics that will drive that algae will not be initially used for oil. It will be used for higher value products initially. Even the oil companies don’t go straight to fuel. Their fuel is somewhat of a by-product, even though it’s the vast majority of petroleum usage. The vast majority of petroleum revenues come from chemicals and plastics. So where algae usage will be initially adopted will be for chemicals and plastics, long before we go to fuels.

Q: How hard is algae technology going to be to develop?
A: As tough as everyone acts like it is, I’ll give you a representative challenge. Erase all the documents and take all the engineers off the planet Earth that know how to make an Intel chip factory. Ok, they’re gone. There are no records, no information, none of the tools currently available to us. Start now and build a complete Intel chip factory. It’s going to take awhile, but guess what? We’ve done that. We’ve built integrated circuits from scratch. We’ve built these factories from scratch without any knowledge.

The integrated circuit was invented in 1959. Look at where the technology is today. You are talking about the technology curve in the information age. We have the complete capacity to do this. Algae technology is simple compared to the task of building an integrated chip factory from scratch.

Outside AVS cultivation cell.

Q: Let’s go back to the question about algae being a potential energy source. How did that interest lead to your AVS harvester?
A: Knowing that there were already complete, valid, working models for algae in the nutraceutical and pharmaceutical industries, we are already way ahead of the game. So we looked at the existing systems and thought, “Where there are barriers, there are opportunities.”

We started to grow algae and ran into the same problem everybody else ran into; getting it out of the water. It really boiled down to, “Well, let’s try this. Let’s try that.” We probably tried everything that everyone else had tried. Then we tried things that people may have tried but didn’t connect how it might work.

So on harvesting, instead of trying to move the solid out of the liquid… why not try to move the liquid out and away from the solid? And instead of doing it at high energy, doing it at virtually no energy or low energy? That’s really what took us to looking at nature and saying, “You know what? We don’t deal with a blood pressure system of 900 psi.” Biological systems don’t work at those pressures, but yet they work. So the real question was why and how could we mimic nature?

We latched on quickly to the fact that when you put a differential pressure on something, you could potentially change its shape and impart energy into it. So our whole goal was NOT to put that differential energy on algae. When we started focusing on and demonstrating it on a very small scale, we were blown away by how successful it was. The difference between putting energy on it and not putting energy on it was dramatic.

Our task at hand right now is taking that to what would be our third and fourth scales. We need to get to the point to where we can handle hundreds of tons in a reasonable amount of time with this equipment. From what we’re seeing, we think that’s doable. We also see opportunities to improve this technology along that pathway. We look at the award from DOE and ARPA-E as being an honor and our entire team has a great sense of responsibility and obligation to succeed and deliver. We’re really excited about being entrusted with this. We have to find a way to be completely successful.

Inside AVS cultivation cell with canopy.

Q: What is your time frame going forward?
A: Our medium scale production model is supposed to be testing in June and July. We’ve got a lot of work to do with that. We’re at the beginning stage of the DOE contract so we’re lining up our own financing and capability to make sure we deliver.

Q: Can you tell me about your rapid algae farming (RAF) system?
A: That is a concept that we think everyone else has thrown out because there are a lot of people who say, “You can’t, you can’t, you can’t.” I am a firm believer in understanding cost vs. benefit analysis. It may be easy on the back of an envelope to say,” You can never, ever do this,” but I believe that by understanding industrial production systems, that we can actually cover an acre with what we describe as a roll-out greenhouse with a range of environmental controls, and the goal of using very low energy. Yes, it would be made of plastic, but the plastic would last seven years. So we amortize our cost over a seven-year period. At the end of seven years, we roll that plastic up, and as a part of the manufacturing supply chain, recycle it…and that plastic is worth almost more than what we bought it for seven years earlier.

So it’s about capital. If I challenge somebody to go build a cell phone from scratch, what is it going to cost? Well, the first model of a Blackberry might have cost $12-$15 million. Who knows? But now go build me a million of them. You’ve got a whole different calculation. That’s the power of what production can lead to, so we’re trying to industrialize the roll-out greenhouse.

Q: What advice would you give Barack Obama on his stimulus spending on renewable energy?
A: If he were looking for an opportunity, the investment and advancement in algal technologies will be more bang for the buck than he would ever get out of anything else. It is going to be what leads us to another level of civilization. This is key and a lot of our thought leaders do not get it yet or they would be investing money in this field like crazy.

Q: Any advice for other early stage algae processing system companies?
A: I would say that it’s critically important for them to find the economic viability while executing their vision. If they have the capability to find ways to make money along that pathway and continue to invest in algae, then that would be a very smart thing to do.

If they are starting up an algae firm because they believe they are going to be funded and they’re going to be able to have a great career studying or researching algae, they are making a huge mistake. They need to stay focused, execute, get profitable and then, for the benefit of everyone including themselves, keep investigating and keep understanding what they would do next in the algae field.

Algae flakes dropping off AVS Harvester conveyer.

Building the right staff is critical. If you think you’re doing this on your own, you’re only going to get two to three people working for you, let alone a hundred or a lot more. Ours is a teamwork approach. It’s great that I’m in a position where I can assist people to be their best. And they assist me to be my best. Together we achieve more. It really helps us stand out from other businesses.

Q: Is there anything else you would like to share with our readers?
A: I think that in our industry we’re not really sure who are snake oil salespeople and who are actually real. This industry needs to ferret out these people because they are going to create a lot of harm.

Also, this industry needs more openness. I think that sharing, collaborating and finding ways that work are the most important things we can do at this stage. We’re not just battling technical challenges but we are going to be battling awareness challenges as well. If we can influence thought leaders and investors, then this is going to be a powerful combination and result in a delivery of technology and products to civilization that is unheard of.—A.I.M.