Dartmouth startup raises $10M to take its marine paint global

A Dartmouth, N.S., startup company is taking the next step to scale up production of its super slick hull paint to a million litres a year.

On Thursday,Graphite Innovation & Technologies announced it has raised $10 million in so-called series A financing money invested after a startup demonstrates the potential to grow and generate revenues.

"This is a great opportunity for the company to go globally,"CEO Mo AlGermozi toldCBC News.

The company makes anti-fouling marine coatings that it says reduce drag andincrease fuel efficiency without harming the environment.

The product has been used and tested on vessels as small as Nova Scotia fishing boats and as large as tankers.

"The shipping industry needs to reduce CO2 emissions, but also they need to be less harmful to the environment. So we bring those two competitive edges,"AlGermozi said.

Where the money is coming from

The Business Development Bank of Canada led the fundraising round with a global syndicate of investors that includesFrance-based Seventure Partners' Blue Forward Fund, Stolt Ventures of the U.K., the investment arm of Stolt-Nielsen, Norway's Farvatn Ventures, Canadian firmMelancthon Capitaland Invest Nova Scotia.

The provincial crown agency Invest Nova Scotia put in $2.5 million. It has previously invested $500,000 in the company since 2018.

"Graphite Innovation & Technologies' strategic vision is for every vessel in the world to use its technology,"saidPeter MacAskill, Invest Nova Scotia president and CEO.

"In addition to this latest round of venture capital funding, the company and Invest Nova Scotia have focused on conducting market research and recently getting into trade markets in Europe, Singapore, and the Middle East."

Global demand

AlGermozi saidthere is global demand for a product that can cut carbon emissions from theshipping industry.

"We are the lowest hanging fruits for ship owners. So we're getting lots of demand now for these coatings and it would be a great opportunity to commit to manufacture and scale up here in Canada.

The company plans to move intoa new facility in the Halifax area that isfive to six times bigger than its current space at Invest Nova Scotia's technology hub in Dartmouth.

AlGermozi saidits operation will be capable of producing upwards of a million litres of marine paint per year.

Earlier this month,the companyannounced a deal with a Norwegian tanker company to coat propellers on 25 ships in 2023.