Boosted by US$6mil Alibaba cash injection, Hong Kong compostable food packaging startup takes on single-use plastics


  • China
  • Thursday, 07 May 2020

Ecoinno has received US$6mil from the Alibaba Entrepreneurs Fund for manufacturing facilities that include a fully automated factory in Tai Po. One of startup’s first customers will be a Hong Kong airline once flights resume. — SCMP

Alarmed by the amount of rubbish they were generating by just drinking coffee and eating cup noodles, two former garments entrepreneurs decided it was time to find an eco-friendly alternative to all the plastic packaging that ends up in landfills globally.

George Chen Dah-ren and Vivian Chang first approached material scientists in Hong Kong and mainland China, and were in 2013 pointed in the direction of Alexander Bismarck, then a polymer materials professor at Imperial College London. The Austrian scientist later came up with a method for producing a plant-based food packaging material that was sturdy, heat-resistant, oil and waterproof, as well as fully compostable.

Together, they founded Ecoinno in 2015, to which Bismarck transferred his intellectual property. Chen and Chang were tasked with setting up a supply chain to turn the material into a commercially viable product. The company moved its operations to Hong Kong Science & Technology Park in 2018.

Their product, dubbed “green composite material”, is made from the leftover pulp of bamboo and sugar cane using Ecoinno’s proprietary processes. The material will completely decompose in 75 days when put in the soil. Chen said it has been approved by New York-based Biodegradable Product Institute and Germany’s Din Certco, which certify compostable products and packaging, as well as the US Food and Drugs Administration, for food consumption safety.

The startup has received US$6mil (RM25.94mil) from the Alibaba Entrepreneurs Fund for manufacturing facilities – including a fully automated factory in Tai Po – that will produce fully compostable packaging and help the city wean itself off single-use plastics, Ecoinno said. The fund is a non-profit initiative of Alibaba Group Holding, which owns the South China Morning Post.

Chang said it would cost tens of millions of Hong Kong dollars to equip the production lines at its pilot factory in Qingyuan, in China’s southern Guangdong province, as well as the planned plant in Tai Po. The production lines – designed and set up by Ecoinno’s in-house engineers – will feature robotics technology, she said.

“We are pleased to have hired a few skilled mould technicians who struggled to find jobs in Hong Kong after the factories they worked for in mainland China closed down in recent years. [We have] provided job opportunities for materials science university graduates [as well],” Chang said.

The Alibaba grant is another shot in the arm for Ecoinno, which has previously received HK$22mil (RM12.27mil) in funding from the Hong Kong Innovation and Technology Commission.

“We were won over by the vision and passion of George, Vivian and their team to tackle single-use plastics pollution, one of the most pressing environmental challenges globally today,” said Edward Liu, partner of WI Harper Group, which helps with managing the Alibaba initiative.

One of Ecoinno’s first customers will be a Hong Kong airline once flights resume. Chen declined to name the carrier because a trial launch of biodegradable food and drinks containers has had to be deferred because of the coronavirus pandemic. Chang said the airline asked 20 suppliers to submit samples before awarding the contract to Ecoinno.

“At this point, we are not aiming for profitability, we just hope people will adopt [our product] out of caring for the environment,” she said. “But we are confident we will not be loss making, as we are good at cost control by designing the products and the production lines ourselves. And we plan to bring our model overseas by forming joint ventures in Japan and Europe.”

Charity Food Angel, which collects surplus food from restaurants and redistributes it to those in need, has placed an order for 20,000 food container sets per day. Delivery is expected in two months.

The used containers can be sent to Hong Kong’s organic waste treatment and composting facilities, without the need for them to go through costly sorting processes, which could potentially save Ecoinno’s airline client 30% in materials procurement and manpower costs compared with its existing practice, Chen said.

The plastic packaging market is projected to rise at an average annual rate of 4% to US$320.9bil (RM1.38tril) by 2027 globally, driven by the food and beverage and industrial sectors, according to Grand View Research.

The demand for biodegradable plastics is expected to be driven by policies. The European Union will ban single-use plastic cutlery and plates next year. In January, Beijing announced it would ban non-biodegradable, single-use plastic straws nationwide by year-end, and that it aimed to cut plastic utensils used in takeaway food in urban areas by 30% by 2025. – South China Morning Post

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