Paptic bags big bucks for plastic-free packaging push

The funding was provided by old and new investors alike, expanding the shareholder base of the company with Ecolab, an American provider of water, hygiene and infection prevention solutions, and the European Circular Bioeconomy Fund (ECBF), a German growth-stage venture capital fund.

The German fund drew attention to the wide range of applications of the recyclable materials developed by Paptic, saying they provide “an excellent basis” for reducing the use of fossil materials in packaging.

“Expanding our global shareholder base was one of the targets of this round, and I am very satisfied with the outcome,” commented Tuomas Mustonen, CEO of Paptic.

“With this funding, we will improve our market presence, sales network and services to our customers. Additionally, this investment will enable us to further strengthen our sustainability performance and expertise, ensuring that we can exceed the requirements of our customers and tightening regulations.”

Among the returning investors were ITOCHU, one of the largest general trading companies in Japan. The Finnish Climate Fund, meanwhile, has provided Paptic a non-dilutive capital loan of 10 million euros targeted specifically at scaling up its foam-based manufacturing technology.

Mustonen identified rapid growth as a factor that appeals to investors: The company has evolved quickly from a startup into a growth company the products of which are used by more than 100 customers globally. It has also more than doubled its revenue annually for four consecutive years, with plans to hit the 100-million-euro mark in 2026.

Its other near-future goals are to strengthen presence in Europe, accelerate growth in Asia and explore expansion opportunities in geographies such as North America.

The value of the global flexible packaging market is estimated to be over 200 billion euros a year, with plastics accounting for 70 per cent of the materials, according to Paptic. The company said its award-winning materials could replace plastics in almost half of the use cases, a prospect it hopes will seize the attention of some of the numerous companies that have committed to abandoning plastic-based packaging.

Efforts to facilitate the shift away from plastics have been launched by several companies in Finland in recent years. Invest in Finland, in commenting on the funding round by Paptic, pointed to a number of factors behind the high number of plastic-free solutions emerging from the country.

“Finland has a unique platform for bio-based solutions, a strong forward-looking industrial cluster, world-class expertise, excellent business and research and development environment and plenty of raw materials,” catalogued Helvi Väisänen, senior advisor for bio and circular economy at Invest in Finland.