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What is Skytree?
What is Skytree and can you share more about your mission?
Skytree develops Direct Air Capture machines for carbon removal and utilisation. We are at the highest level of technology maturity; TRL-9. Unlike many others in the industry, we do not develop large DAC plants; instead, we design, build, deploy and service DAC machines that are produced in mass volume that can be used to create large scale DAC parks or small scale DAC systems onsite. We supply CO2 at the location where that CO2 is needed; to the industries that use it, or to CO2 storage sites.
Skytree was founded in 2014 as a spin-off of the European Space Agency, where the technology was first developed to remove CO2 from the cabin of the International Space Station. For the first eight years, we were an R&D-focused company where a team of scientists researched on behalf of companies, built prototypes, while registering patents. Since I became CEO early 2022, we grew the team from eight people to over 100 and began developing and building these DAC machines in earnest.
CDR Inspiration
What was the inspiration that led to your carbon removal business?
Everybody in the industry is united in the need to solve the climate crisis, but it is apparent that there are still some pockets of debate. Most people in the world are aware that something is happening that isn't good for humanity's future. We must change how we eat, work, live, and move to combat climate change. At this very moment there is already too much CO2 in our atmosphere and some industries won't be able to decarbonize at the pace that we need them to, which means that emissions of CO2 will continue for a while..
This is why we need technology to remove historical emissions and make CO2 circular for industries that need it and now get their CO2 from fossil fuel sources. That's where direct air capture comes in to drive the CO2 transition. Everybody at Skytree is united in the purpose that drives us, and we firmly believe that we can have the most impact by combining the economic principles of building a profitable business while serving these bigger climate goals.
'aha' Breakthrough
Can you share that 'aha' breakthrough in your business' journey that left you especially excited about its potential?
My 'aha' moments came when I fully understood the advanced position Skytree was in. For a small company, there was excellent knowledge and prototyping, IP and ideas, and a very professional group of people. I realised that businesses worldwide currently pay billions of dollars to buy CO2 from fossil fuel sources. But putting it to use in greenhouses or carbonated drinks doesn't eliminate the emissions; it's only being delayed. This is why users of CO2 should switch to a circular source such as biogenic or atmospheric. And the CO2 captured in the fossil fuel industry should be permanently stored and prevented from coming into the air around us. The world needs onsite CO2 capture from the ambient air, at the location where it will be utilized or sequestered.
Investor Attention
What have you found the best way of garnering investor or buyer attention?
At the beginning of my journey, there was hardly any money in Skytree. So, we had to use cash from our pockets to get started. We extended our runway month by month with money from “friends & family” but weren't ready to go to professional investors, as our technology was not advanced enough, and our strategy needed to be better articulated.
Slowly but surely, we came on the radar of early-stage funds, and after many conversations, we started to understand all the mistakes we were making. We became more polished, received pre-seed some grants and got our first professional investors on board.
We were awarded a grant from the European Innovation Council and a Dutch Green Fund, and millions of dollars of funding came in. In total, we've raised 20 million euros since I joined, and we're preparing for a Series A to finance our next chapter of growth..
We're now in a different league; we're a revenue-generating company. Our tech is now proven in the field, and we've got a very big pipeline of projects for customers, large and small. Raising a Series A in this stage of the company is much easier than raising half a million in pre-seeds. I can tell you that much!
Scaling the Industry
How are you approaching scalability, and what tools or strategies have proven most effective in levelling up your solution?
Skytree develops DAC systems which can be installed everywhere, at locations where the CO2 is needed for use, such as greenhouses. The same Skytree DAC machines can be installed in a DAC Park for large scale sequestration. The benefits of this approach is that by combining the decentralised DAC market with large scale storage we can scale up manufacturing very fast as installing single units is already happening and volume is increasing quickly, while the large scale projects usually take a few years to develop. By the time mass deployment for CO2 storage is rolled out we will have driven down the costs of these machines substantially. Furthermore large scale project developers like our approach as they can start at every moment by installing a first machine, test their energy integration and storage process, and s derisking the technology before they roll out. A DAC Plant is a much more risky operation in our view.
Another aspect of that machine design is putting machines in the field where we have a maintenance contract. We built the machine to upgrade the software, the carbon capture material, and the sorbent on-site in the field. We are co-developing improvements to that material with the chemical industry. Every 2 years, we do an absorbent exchange, which can be quickly done in the field to increase the capacity of the unit and decrease the energy needed per tonne of CO2. So, we invite and convince early adopters to buy Skytree because it's a safe bet.
When we look at our own company, everything we do is built for scale. One of the issues of fast-growing technology companies is not only finding and hiring exceptional talent but making sure they're happy and productive, which isn’t easy as the more people you hire, the more internal confusion and less alignment there will be. I'm proud to say that Skytree is very well-structured. People know what to do, and there are smart and effective programmes to stimulate productivity.
CDR Challenges
What's the biggest challenge your business is facing in 2024, and what do you think is required to solve it?
We don't have one major challenge in Skytree. We've got a collection of challenges, including scaling up the supply chain, securing the necessary components, matching that with long-term demand forecasting, doing final iterations of filter designs and more. But there are no real challenges that stand out. We're comfortable in the sense that we know what we're doing. We know what issues we need to solve, but there are no significant roadblocks ahead of us.
Into the Future
What, from an industry perspective, should we be aware of in the next 18 months if we are to see the scale necessary to hit 2030 targets? It's just 24 business quarters away.
We should stop throwing hand grenades at oil and gas companies and unite with the emitting industry in our objectives to combat climate change. Al Gore said, 'We don't want to even think about oil and gas companies, let alone partner with them.' I think that's pretty ludicrous. We can’t turn a blind eye to the oil and gas companies, instead we must unite climate tech with the emitting industry to drive effective programs to reduce the levels of CO2 in the atmosphere.
First, we all agree that large emitters need to stop emitting. But the global population and industries are not able to change overnight. So, the first thing the large emitters should do and what they are increasingly doing, is capturing and sequestering all of the CO2 they emit from their point source. And not put it to use in let’s say carbonation of drinks or greenhouses, as that only leads to postponed emissions.
Imagine these large emitters increasingly building carbon capture facilities to capture their CO2, and storing it in empty oil wells, neutralising their emissions, referred to as Carbon Capture and Storage (CCS). More is needed to also solve their historic emissions, so they should piggyback their CCS infrastructure by adding DAC Parks to their industrial sites, capturing CO2 from the air, injecting it into their piping infrastructure and then sequestering it in the same empty oil wells, creating negative emissions. We call that their Scope Zero. Forward-looking gas, fertilizer, steel, and energy companies should build DAC hubs next to their CCS infrastructure. And on top of this our technology can be partially powered by their industrial waste heat, reducing the need for electricity from the grid.
