A Ukrainian startup has found a replacement for plastic: it makes eco-packaging from mushrooms and hemp

Global companies have become interested in the product of the Ukrainian startup S.Lab, which produces environmentally friendly packaging from plant materials. The technology invented by IT specialist spouses will help reduce plastic consumption, reports EPravda.

Photo: IStock

Instead of plastic, eco-friendly packaging is made from plant materials, which decomposes in the ground in 30 days. There are more and more such solutions in the world, and Ukraine is also joining global trends. So far, mainly at the level of small business projects.

Ukrainian startup S.Lab became one of the winners of this year’s IT Arena conference and received $210 in investments. The startup uses industrial hemp and mushrooms to make environmentally friendly packaging for cosmetics, electronic devices, fragile decorative items, and even clothing. Its peculiarity is that it can be used for years, and once in the ground, it decomposes in just a month.

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The idea for the project was conceived by the spouses Yulia Beletskaya and Evgeniy Tomilin in 2017, and three years later, after a series of studies and experiments, they began work. The startup, created in Kyiv, was focused on the European market, which would take years to gain a foothold in. However, the war significantly accelerated all processes.

A trip to Bali changed everything

The founders of the startup S.Lab (the abbreviated name comes from Sustainable Laboratory, “sustainable laboratory”) are spouses Yulia Beletskaya and Evgeniy Tomilin. The problem they are trying to solve is not new and is becoming more pressing every year: environmental pollution.

Yulia and Evgeniy encountered its scale in 2017, while traveling through Asian countries, where mountains of plastic pollute local beaches.

“We started watching videos, reading research on the topic and studying what is currently on the market for environmental materials. We wanted to create a material that had the same functions as plastic, foam or cardboard, but was completely environmentally friendly. “- said Yulia.

Several years were spent discussing the production process of the material, studying the market and researching. My wife's biotechnological education helped. “We realized that to create the material you need two components. One will give strength - the so-called spine, and the second will glue it all together,” explains Yulia.

Research has shown that the most durable natural raw material for the “spine” is industrial hemp, widespread in Ukraine. That is, there should be no problems finding it.

Through trial and error, it turned out that mycelium or mycelium can serve as a component for gluing. Mycelium is a reproduction system for fungi, roughly comparable to the root system of trees.

“We turned to the Nikolai Kholodny Institute of Botany in Kyiv. Scientists have confirmed that mycelium indeed has adhesive properties. They grew the first mycelium culture for us and gave us a little training,” recalls Belyatskaya.

The experiments began. The first samples turned out to be successful. To get objective feedback, the co-founders decided to distribute the finished products to friends.

“We didn’t have a focus on packaging, so we made decorative elements, flower pots, small jugs, coasters. They also made several examples of building materials, something similar to brick. There was also packaging,” says Yulia.

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Having received feedback, we decided to focus specifically on eco-packaging.

“When we made the first samples, the feedback was 90% positive. Everyone liked the idea, but doubts remained that the products did not look very aesthetically pleasing. This is not the plastic that everyone is used to,” says Yulia.

First difficulties and competition

At the beginning of its work, the startup encountered its first difficulty. Some customers ordered thousands or tens of thousands of packaging units that the startup could not produce. “We had a small production, and customers wanted to quickly take advantage of such an innovative material,” recalls Belyatskaya.

This problem has not yet been resolved. She forced the founders to think about introducing automated technology that would allow them to produce large volumes of products. That is, we are talking about scaling the business.

“When we started, there was one company in the US - Ecovative, which also uses mushroom mycelium, but not with hemp, but with shavings from agricultural production. This is also waste. They also produce packaging, but this is not their main profile,” says Yulia.

The founders noted that the market is leaning towards environmental packaging. “A year ago, I noticed a huge change in the thinking of large companies. The eco-packaging segment is growing by 15-20% annually, and the demand on the market is much greater. I think that soon there will be a complete replacement of plastic materials with natural ones,” says Yulia.

Working with big business

The couple began building a startup in Kyiv, where they quickly found their first clients. Among them was the capital's restaurant "Altruist". The establishment ordered several decorative elements and then packaging for New Year's sets. The restaurant also carried out environmental renovations and ordered several products from the startup.

Some of the first clients were representatives of the cosmetics, decor, clothing, and electronics industries. They ordered packaging for their products. However, after the outbreak of the war, it was necessary to look for new markets, because many domestic clients temporarily stopped their activities.

There were plans to scale the project before, but the war accelerated their implementation. “In April 2022, we started exploring the Scandinavian market. Then we went to the markets of France, Spain and Portugal. This summer we were looking for clients in Germany and Switzerland,” says the startup’s co-founder.

The startup focuses on the EU market. Ukraine accounts for 20-30% of sales: clients resume work, and positive reviews allow us to attract new ones.

Production is located in Spain, where an automated line is being built. They buy hemp in Ukraine - they have agreements with large producers who cooperate with farmers. The second component – ​​mycelium – is cultivated in our own laboratory. In total, the final mass contains 10-15% mycelium, the rest is industrial hemp.

“After launching a production line in Spain, which will produce 50 thousand packaging units per month, we want to make the same one in Kyiv. We have many Ukrainian clients and it is better to have such production closer to them. We also want to support the country’s economy and create jobs here,” Yulia emphasized.

Eight Ukrainians are working on the project, and foreigners will also be involved in the work.

Now a startup can cover the needs of small and medium-sized businesses. S.Lab also works with multinational corporations. They are interested in hundreds of thousands of packaging units, so for fruitful cooperation they need to expand production.

S.Lab plans to scale up the line in a few months, which will produce 100 thousand units per month, and subsequently half a million. “Samsung would like to replace TV packaging with our packaging, but they produce 5 million TVs every year. We cannot cover such volumes,” says Yulia.

S.Lab works with corporations like this: they choose one brand or product and offer it environmentally friendly packaging. The startup operates in several niches.

• The first is the beauty industry (cosmetics and care). These products must not only reach the consumer intact, they also require maintaining a certain temperature during delivery. The startup’s products provide good thermal insulation.
• The second niche is equipment, the third is decorative items for the home (vases, glassware, figurines). Representatives of the fashion industry also turn to S.Lab - designers want environmentally friendly packaging for their clothes.

The startup also plans to work with the food and pharmaceutical sectors, which, according to Yulia, are the largest consumers of foam packaging. To do this, it is necessary to undergo certification for interaction with food.

Cheap raw materials, but expensive innovations

The couple began developing a startup using personal savings. They invested $40-50 thousand into the business. Proceeds from the sale of the first orders were invested in the business. At the beginning of its work, the startup won several small grants, in particular from Visa, which allowed it to increase the amount of start-up capital.

In 2022, the startup raised $80 from the European accelerator Startup Wise Guys. Then only nine startups were selected from all over the world, one of them was Ukrainian. It was a three-month acceleration program, four weeks of which the Ukrainians spent in Copenhagen, exploring the local market and communicating with potential clients - beer and fish producers.

S.Lab also became one of the winners of the IT Arena conference this year and received $210 in investments during the conference - $000 from ZAS Venture, $100 from investor Sasha Reminny and $000 from Vesna Capital.

The profitability of such a business depends on the business model and business development, as Yulia says. “The raw material is inexpensive because we only use the stem, a waste product that is left in the fields. Farmers are ready to give it to us at the cost of work: collection, processing and delivery,” she explains.

Since the business grows the mycelium on its own, the costs are associated only with reclamation. “Manual production is not cheap, so we are building an automated production line using our technology. This part is a serious investment,” Beletskaya shared.

According to her, the spouses invest all the money earned by the startup into its development, so S.Lab has not yet reached the level of payback. Since the business has pre-orders from customers, setting up production can pay for itself in a year.

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