BDC Capital deploys seed funding to help reduce greenhouse gas emissions

Green Graphite Technologies closes $2 million, while Arolytics raises $3.5 million in cleantech funding.

Placing increased importance on climate change and the reduction of greenhouse gas emissions, BDC is backing a couple of cleantech startups with financing from its climate funds.

BDC Capital is the investment arm of BDC, Canada’s federally funded investment bank for entrepreneurs. Funding for one of the startups is coming from the bank’s Climate Tech Fund, while the raise for the second marks the first investment from its $150-million Sustainability Venture Fund.

Arolytics provides oil and gas software and data analytics solutions, while Green Graphite aims to turn natural flake graphite and recycled graphite into battery grade graphite.

Montréal-based materials startup Green Graphite Technologies has closed a $2-million seed funding round co-led by BDC Capital’s Climate Tech Fund and the Sustainable Chemistry Alliance, with participation from a private investor.

For its part, Calgary emissions-management company Arolytics has raised $3.5 million in seed financing as BDC Capital’s first investment from its $150 million Sustainability Venture Fund. Arolytics provides methane software and data analytics solutions for the oil and gas sector.

Green Graphite is commercializing what it calls a cost-effective and eco-friendly process to transform natural flake graphite and recycled graphite into lithium-ion battery grade graphite for electric vehicles.

“Closing this seed round with such prestigious and experienced investors is a major milestone on our journey to rapidly become the global solution for producing battery-grade graphite from mined natural flake graphite and from secondary sources such as recycled lithium-ion batteries,” said Gillian Holcroft, CEO and co-founder of Green Graphite.

Meaghan Seagrave, executive director of Bioindustrial Innovation Canada, said: “In order for Canada to achieve its emissions targets, it will need to continue to support and scale early-stage novel technologies like Green Graphite’s.”

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Seagrave noted that as Canada’s only green chemistry accelerator, Bioindustrial Innovation Canada, through its Sustainable Chemistry Alliance Investment Fund, is focused on identifying, validating, and investing in technologies that will allow Canadian and global industries to decarbonize while positioning Canada as a leader in clean technology development.

“Thanks to this crucial investment support, Green Graphite will become instrumental in supporting Canada’s lithium-ion industry while reducing its reliance on unsafe and environmentally damaging foreign sourced materials,” she added.

Green Graphite’s technology development roadmap has advanced rapidly since the company’s creation in August 2021. In September 2022, Green Graphite announced that it received a $1.1-million grant from the federal agency Sustainable Development Technology Canada (SDTC) to advance the development of its GraphPureTM technology to transform NFG into battery-grade graphite.

Earlier this year, Green Graphite received a $500,000 grant from the provincially funded PRIMA Quebec for piloting its technology that transforms spent graphite from lithium ion battery recycling operations into battery grade graphite. The company said it plans to use these funds to help expand Green Graphite’s core team and support scale up efforts for its technology.

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Graphite miners and battery recyclers will have the option of adopting a graphite purification technology that will enable our society to meet the ever-increasing demands for lithium-ion powered vehicles, according to Green Graphite. The startup contends that with the success of this project, Canada will be seen as a leader in cost effective and clean technology that ultimately eliminates the need for global lithium-ion producers to source graphite exclusively from China, currently the only player in this market.

“Green Graphite Technologies developed a much cleaner process to purify graphite, one of the key components of lithium-ion batteries for electric vehicles,” said Nicole Leite, principal, Climate Tech Fund at BDC Capital. “Solving this problem is crucial to the energy transition and to helping Canada reach its net zero objective.”

Leite said that the demand for lithium-ion grade graphite will only keep increasing, with a projected global demand of two million tonnes per year by 2030. “Our Climate Tech Fund was designed to enable the scale up of this type of impactful, innovative technology, which will lead to Canada’s future prosperity,” she said.

For Arolytics, participation in the round also came from the Accelerate Fund III managed by Yaletown Partners, Metiquity Ventures, Startup TNT, a Houston-Based strategic investor, and recently secured government grants awarded from a variety of federal and provincial organizations.

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In April, BDC Capital launched the $150-million CAD venture fund focused on helping Canada meet its sustainability and climate targets.

The new funds will enable Arolytics to scale quickly, with a focus on continued product innovation and market entry into the United States. As well, the startup plans to expand its team in order to address client needs in what it says is a time-sensitive market.

Since Arolytics’ last raise, the team has more than tripled in size, expanded sales to the US while improving the automation and scale of its product.

Arolytics was founded in 2018 by a team of methane experts who have leveraged their years of experience in methane research to provide solutions for optimizing methane strategies for the oil and gas sector. The startup claims its platform is designed to allow energy companies to gain valuable insights into methane measurement data, leading to faster emissions reductions at lower costs.

Feature image courtesy BDC.

Charles Mandel

Charles Mandel

Charles Mandel's reporting and writing on technology has appeared in, Canadian Business, Report on Business Magazine, Canada's National Observer, The Globe and Mail, and the National Post, among many others. He lives off-grid in Nova Scotia.

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