Waste start-up hopes to secure Series 2A round
Australian waste-to-resources start-up Arc Ento is actively talking to investors, hoping to secure part of a Series 2A round.
The tech company, which was founded in 2020, turns rubbish into resource material, including a coking coal alternative, and is working on three landfill sites in Sydney.
Having turned around a $1m loss into a $1m profit, it’s looking for new investors after a $5m capital raising with the Philippines industrial supplies company MCCI Corporation didn’t complete.
Chief Executive Adam McArdle told investors that weekly processing has scaled from kilograms to tonnes and that the production pipeline can now deliver $1.5m in monthly revenue.
McArdle said he was currently in talks with alternative investors as part of the Series 2A round, the aim of which is to maintain commercial momentum and fund the company’s growth road map.
He was confident that funds could be raised from Australian-based investors.
He told The Australian: “…we are actively in discussions with alternative investors as part of the Series 2A round and expect to firm up this before the end of July. This will ensure we maintain commercial momentum and fund our growth road map.
“Our three-year forecast demonstrates scalable profitability. Arc expects to generate $39m in revenue in FY26, with this figure growing to $101m by FY28. These projections are based on secured and forecasted channel growth, operational efficiencies, and product margin expansion.
“Critical to this transformation has been the establishment of a strategic lending facility with the Commonwealth Bank Growth Industries Team. This facility can provide Arc with debtor finance, working capital, trade finance and equipment finance, along with a full suite of foreign exchange solutions.”
Arc Ento is a pioneer within the global waste industry, working with two innovative processes to convert household garbage into energy: biological and mechanical.
Black soldier flies are used in the biological solution to consume all edible organic waste. The flies’ larvae are then recovered and converted into commercial products, including an insect which can be used as a fertiliser, or fish food.
The mechanical process is different. It converts plastics and non-digestible organics into refuse derived reductants. This is a type of fuel that can be used for a range of industrial purposes.
Within the process the carbon and hydrogen are targeted, and the subsequent content of non-digestible organics used to create a softened composite material which is extruded into an RDR briquette. This is offered as a low-cost alternative to the use of high-grade coal or metallurgical coke.
McArdle told the media that the company expected a number of new customers to sign contracts shortly, including Qantas and Sanitarium. He confirmed that Hawkesbury City Council has also contracted Arc to develop a 25-tonne-a-day plant.
He said: “The Hawkesbury City Council partnership has reached a key milestone. All plant components and final design specifications are scheduled for delivery by August.
“The facility is being built and will be commissioned by September. This will enable Arc to begin dry waste trials and product testing while awaiting final EPA certification, positioning the site as a proof point for future commercial rollouts.”
The World Economic Forum estimates the cost of climate change is set to soar to $US3.1 trillion ($4.75 trillion) a year by 2050.