Water treatment startup Algal Scientific now mining beta glucan

June 17, 2013
AlgaeIndustryMagazine.com

Algal Scientific chief science officer Geoff Horst shows off his beta glucan-rich algae at the company's lab in the Michigan Life Science and Innovation Center. Photo: Ben Freed | AnnArbor.com

Algal Scientific chief science officer Geoff Horst shows off his beta glucan-rich algae at the company’s lab in the Michigan Life Science and Innovation Center. Photo: Ben Freed | AnnArbor.com

Ben Freed reports in the Ann Arbor Business Review that Algal Scientific – a startup which emerged from Michigan State University in 2008 to use algae for reducing the costs of water treatment – has now developed a parallel process to use the algal biomass to make beta-1,3 glucan, a compound of high value in animal and human nutrition.

Further testing on the species of algae they were using to clean up the water revealed it was worth more as a dietary supplement than a simple fertilizer. The algae were high in the sugar compound known as beta glucan, which acts as an immune system booster. “About a year and a half ago we realized that this beta glucan that was in the algae we were already using was very valuable,” said Geoff Horst, a Ph.D. candidate at Michigan State University at the time, and now the company’s chief science officer. “It is worth $20,000 to $30,000 per ton and at that price point we figured, ‘Wow, we can make a lot of money with this.’ ”

Right now, the most popular source for beta glucan is certain types of yeast that develop the chain of sugar molecules in their cell walls. The species of algae used by Algal Scientific is more than 50 percent beta glucan, while yeast has just 5 to 15 percent beta glucan content and requires an expensive process to extract the compound from the cell walls. “It’s a unique species of algae,” says Horst. “You probably wouldn’t encounter it in a local pond or lake, but it’s not genetically-modified. It’s a naturally occurring species, just not a very common one.”

As trials of their beta glucan product move forward, Horst and his co-founders Bobby Levine, Jeff Lebrun, and John Rice are looking to find a new location to expand their production. “There’s not much more science we have to do to be profitable; now we’re really in the ‘ramp-up, scale-up’ mode,” Horst said.

The company has grown to include nine full-time equivalent employees and has brought in approximately $1.5 million in outside funding, which includes $500,000 for winning the Accelerate Michigan innovation competition in 2012.

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