SeaChange Biochemistry, which extracts specialty chemicals from seaweed, is planning to begin production at its new facility in Clark’s Harbour, NS, by June.

Having won or placed prominently in a range of pitching competitions in the last two years, SeaChange got a further financial boost last week when it received a $250,000 loan from the Atlantic Canada Opportunities Agency.

The loan, issued through the federal government’s Regional Economic Growth through Innovation program, has helped to finance the equipment that will soon be installed at its plant at the southern tip of Nova Scotia.

The company had been planning to buy new equipment, but those plans got shelved as the pandemic interrupted supply chains. So the co-founders began looking for used equipment, which they were able to find at lower prices than what had been quoted before.

“We were able to source everything second-hand,” said SeaChange CEO Sabrena MacKenzie in an interview. “It was pretty intense at the time but we got higher quality equipment, and local, and some is still under warranty.”

SeaChange is a fairly media-shy company because its founders are concerned about revealing too much about their intellectual property. But MacKenzie and Co-Founder Chris Rafuse have created buzz by competing so well in several competitions in the past two years.

They won $25,000 from the Ocean Startup competition earlier this year, $22,000 from Start-Up Yard, and have twice won $25,000 tranches from Innovacorp’s Sprint competition. In 2019, SeaChange was a finalist for the BioInnovation Challenge, the main pitching competition for Atlantic Canadian life sciences companies.

Halifax-based Motryx Partners with Germany's Aerocom

The SeaChange founders discovered and are commercializing a process to extract chemicals from kelp, and to provide commercial quantities of these chemicals at lower costs and a smaller environmental footprint than their competitors. They are reluctant to name the chemicals in public, but say they plan to initially provide materials for the food and beverage, cosmetic and pharmaceutical industries.

MacKenzie, a natural materials chemist who previously worked as a technical officer at a National Research Council, said these market segments demand high-quality chemicals, which the SeaChange process is able to provide at competitive prices.

The part of their pitch that makes people sit up and take notice comes when they discuss market pull. A year ago, the company had lined up six customers that were waiting for them to get their plant up and running. But MacKenzie and Rafuse had never made a single sales call. All the prospective clients had heard about the company by word of mouth and had contacted them out of the blue.

“That’s been the great, and surprising, part,” said MacKenzie. “I was heavily focused on making sure the product worked and we had a market development plan. We had steps we needed to take. As we were going through those steps in the early stages, people started coming to us. Some were referred by IRAP and some were referred by other startups.”

SeaChange now has the equipment it needs to begin production but has to assemble the gear in its facility in Clark’s Harbour. MacKenzie expects the team will begin producing two batches per week of chemicals (each batch is one metric tonne) in the first half of 2021, and the facility will have the capacity to produce as many as14 batches a week.

The output and staffing in the coming year will depend on how sales progress. What MacKenzie did say about next year is she is planning an equity funding round: “We will definitely be raising in 2021.”