Captured Carbon to High Value Products — Staff Sheehan CTO and Cofounder of Air Company
Co-led by CTO and Cofounder Staff Sheehan, Air Company is an investor-backed carbon-to-value innovator recognized by awards such as Time Magazine Invention of the Year, Fast Company World Changing Idea, and NASA Conversion Challenge.
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What does Air Company do?
The only inputs to our chemical manufacturing process are carbon dioxide that we capture from point sources or the air, water, and wind and solar electricity. The only things that come out are alcohol products and oxygen gas.
Can you talk about your training to get to the point where you and your team can turn those three simple inputs into a lot of premium consumer outputs?
It sounds simple, but if it was easy then somebody would have done it before and climate change wouldn't be quite as bad as it is right now. It gets pretty complicated when you get down to the details. Our technology is basically artificial photosynthesis. It does the same thing as actual photosynthesis, except it's using man-made processes that can do it at the same rates that we’re spewing carbon dioxide out into the atmosphere.
Can you tell us about your path to starting Air Company?
I've been studying chemistry in one way or another for well over a decade. I started doing research on sustainable technologies and chemical technologies when I was 18 years old and went to Boston College to study physics and chemistry. Then I did a PhD in chemistry at Yale. After graduating, I started a business in the chemical industry.
After exiting that business, I decided to get together with my business partner, Greg, to start a company that could have a transformative global impact towards fighting climate change. That's really the goal of Air Company. My background is on the technical side, so I spend all my time working on technology development and technology scale-up. There's a gap needed to make both consumer products as well as industrial chemicals and industrial fuels more sustainable.
What are examples of this carbon to-value transformation? What's the first line of products that Air Company is creating, and what might the next generation look like?
Air Company started out and is currently selling premium consumer goods at the top of their class using the alcohol that we produce from carbon dioxide. Our first product was vodka, which we make from carbon dioxide. Our vodka is in the market in New York City, and it won gold medals at the three largest blind-taste test competitions in the world.
When the pandemic hit, our second product was launched, which we accelerated due to the sanitizer shortage that was happening in New York City. We call it Air Spray. It's an 80% ethanol hand sanitizer. We ended up donating 15,000 bottles to underserved communities and first responders during the pandemic.
Then our third product is launching shortly. By the time this podcast airs, it may actually be launched, so we have another product that's coming out soon!
It’s not something you hear every day for a startup to be making donations. Can you talk more about that?
When the pandemic hit, we took all of the ethanol that we had produced and mixed it as a sanitizer, and donated it for several reasons. The first one was because a lot of supply chains were ruined by the pandemic, so it wouldn't get to the people that needed it the most if we had gone through standard purchase and sale. We sold the hand sanitizer as well. For every bottle of hand sanitizer sold, we also donate one. We don't make a profit on the sanitizer. We do it as a way to generate revenue, but also to do good for our community.
The decision to donate was not one that we made lightly, especially because we are an early-stage business, so we are dependent on revenue to some extent. However, we thought that it was the right thing to do. No matter how much money that we made, I wouldn't feel right if we weren't doing the right thing.
What are the biggest pieces of cost in your processes, and how is your business model or chemistry unique to address those?
There are three major cost buckets when you're trying to transform carbon dioxide with a photosynthetic scheme. The first major cost bucket is renewable electricity. We are dependent on the cost of renewable electricity getting cheaper as time goes on. The second one is carbon dioxide capture. We're dependent to some extent on our ability to source carbon dioxide since we're a carbon dioxide utilization company. The third thing that we need is more effective energy storage. You could actually think of our systems almost like giant batteries because we're taking the electrical energy, and we're transforming it into chemical energy so that it can be stored.
What similarities would you draw to green hydrogen? Is that the same as what you're talking about with Air Company?
It's the same as far as green hydrogen goes. We just use hydrogen as an intermediate, so we don't store it. Hydrogen is quickly consumed to produce alcohols. I would say that the effectiveness of green hydrogen is coupled with what you're using it for. If you use it as a chemical intermediate to make a chemical that is very low carbon compared to what is made from fossil fuels, it's a very effective use of green hydrogen.
What kind of product differentiation is Air Company aiming for with its products?
The first product differentiation for all of our products is product quality. People buy our vodka not knowing that it's sustainable, but they just really appreciate its taste. There's a preconceived notion that when you buy a sustainable product, you're compromising on quality, and that's not always true. It does cost a lot to produce things from carbon dioxide, so we tried to make a premium product to justify its cost. We believe that every one of our products is good value for the money.
As we scale, we're going to drive the cost to produce down, and we're going to be able to get into broader markets. We’re going to be able to improve our region and increase the impact that we can have on fighting climate change.
Could you say more about the process for funding Air Company’s growth, and why that's the right fit given the kind of company that you're building?
We're primarily investor-backed. We also have revenues, and we've been fortunate to get some support from a handful of government agencies in the United States and Canada that have supported our technology based on its technical merit and its potential to help fight climate change. We really value having investors who have the same priorities as we do to fight climate change. The number one thing we look for in investors is a commitment to sustainability.
We plan to be a high revenue-generating, high-growth company. We have a variety of different markets that we're going into, and we look for strategic partners who can help us access those markets as effectively as possible.
Do you have any advice for first-time founders as they're thinking about launching their first companies? If you had to talk to your younger self knowing what you know now, what advice would you have?
The first piece of advice for technical founders specifically, and the thing that enabled me to innovate when I was in graduate school, was a National Science Foundation Graduate Research Fellowship. They are one of the US funding agencies that have really helped Air Company. The National Science Foundation has a lot of programs for startups, and I would encourage any technical founders to look into and apply for those.
The second thing is I've worked with a lot of founders of a lot of different businesses in an advisory role. If you're going to start a business, do as much research as you can to understand how the startup world works and to understand what it takes to start a business. This goes well beyond your technological capability. Consider joining an accelerator program as a jumpstart. There are several programs like YCombinator throughout the country that are interested in helping to build businesses. Other programs include Third Derivative, Greentown Labs, Elemental Excelerator, and MassChallenge.
Are there any habits or routines that contribute to your success as an entrepreneur?
My advice to early-stage founders is if you see an opportunity, apply for it. If you get accepted, and it turns out it's not what you wanted, then you're usually allowed to decline things after the fact.
As you grow a business, efficient time management is very important. I live by my Google Calendar at this point. Very structured and effective time management is really important when you're in growth phases.
My last piece of advice and probably the thing that has kept me sane in the toughest of times is to keep exercising. This is one of the things that gets dropped off the radar first when we’re busy because people don't think it's a priority.
What kind of people are you hoping to hear from?
I'm always happy to help people who are either trying to embark on a startup path or trying to do good for our planet. The people that I enjoy hearing from the most are the people who are trying to do something that will help fight climate change or help with sustainability in some other way because there's a lot of carbon dioxide that Air Company is going to need help addressing. Even if we do reach all of our goals, we'd be able to mitigate 10% of global greenhouse gas emissions. There's still the other 90%, so I'm always happy to hear from folks who are working towards sustainable solutions.
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Note:
THE TORCH is an interview series from Entrepreneurs for Impact. We profile CEOs and investors mitigating climate change. Our goal is to highlight their work and inspire others. As we deal with multiple crisis, from Covid and racial injustice to climate change and economic recession, we need some of this positive light in what seem like dark times. Onward and upward.