Resources

• Mantel – Developing molten material-based carbon capture for industrial emissions
• Breakthrough Energy Fellows – A program supporting early-stage climate tech innovators
• The Engine – VC firm backing tough tech startups out of MIT
• MCJ – "My Climate Journey," a podcast and investor network on climate tech
• Kruger – Canadian pulp and paper partner for Mantel's first demonstration project
• 45Q Tax Credit (U.S. IRS) – U.S. tax credit for carbon capture and sequestration
• Canada's Carbon Tax Policy – A national carbon pricing mechanism incentivizing low-carbon tech

Host and Guest

Host: Mike Toffel, Professor, Harvard Business School (LinkedIn)

Guest: Danielle Rapson, Co-founder & COO, Mantel (LinkedIn)

Transcript

Editor's Note: The following was prepared by a machine algorithm, and may not perfectly reflect the audio file of the interview.

Mike Toffel:

Danielle, thank you for joining us here on Climate Rising.

Danielle Rapson:

Absolutely, Mike, happy to be here.

Mike Toffel:

So, it's always fun for us to speak to our alumni out in the world who are working in the business and climate space, which is the target market of this podcast. So, why don't you tell us a little bit about how you got to be COO of Mantle, a carbon capture technology company. What was your path there?

Danielle Rapson:

Yeah, absolutely. It's a non-traditional path, I think. So, I graduated from HBS in 2021 and a half, I like to say. Middle of COVID, took some time off, not wanting to do online school. I went to HBS with no intention of doing a startup. I am a risk adverse person. I wanted to do consulting or private equity or one of these staple jobs. I had come to HBS previously with a mechanical engineering degree and I had worked at NextEra Energy managing natural gas power plants. So, I've been in the energy world.

of not necessarily the clean energy world. My interest was always in what is the in-between. It wasn't necessarily the renewables, the battery, or it wasn't necessarily the oil and gas side of things. How do you bridge the two of those, recognizing that we're not going to be able to do 100 % renewables or 100 % clean anytime soon and probably not in our lifetime? While I was at HBS, I explored that a bit. I did an internship with BCG. I did an internship at another startup with a VC, testing all the different world.

but ended up taking a course at MIT my last semester called Climate Energy Ventures. And so, in that class, I worked on this project with my two co-founders, a team of eight people, really as a class project. We had no intentions of taking it forward, but over the course of that semester, we realized that there was actually something here. And at the end of that semester, we decided to launch what was at that time called BexCo and is now Mantle. So, that was December 2021.

I have already accepted a job with BCG. So, I started in January 2022 with BCG. My co-founders and I were raising on the side. had a semester. They were both at MIT doing their PhDs. They had a semester left to go and we raised. I quit BCG after six months after we had become a part of the Breakthrough Energy Fellows Program and raised a small seed round. And we officially launched Mantle in, when was that, early 2022.

Mike Toffel:

Yeah, let's talk a little bit about the technology because I imagine that's what got you So, excited about it. It's quite different. So, we're in the world of carbon capture and sequestration, ultimately. And as I think about that world, there's how do we get carbon out of the atmosphere or at least stop it from even entering the atmosphere. I think of that as like a little bit of a decision tree here. So, there's like nature-based solutions, which would be for planting trees, taking carbon dioxide out of the atmosphere, puts it into the tree biomass or into the soils. Then there's the technology plays, which some of which are also, about ambient air. And those are often called direct air capture. These are the big fans with chemistry going on as the air, it blows air through some chemicals, and it takes carbon out of the atmosphere. And then others on the technology space are looking at more concentrated plumes of CO2, which could be exhaust fumes from cement plants or from power plants or so on.

So, where in this area are you, guys playing and what's different about Mantle technology from the ones that are out there that led you to decide to abandon a promising career at BCG to go a risk averse person to go jump into a startup?

Danielle Rapson:

Yeah, So, we're on the second one that you described there. So, we're doing point source carbon capture, meaning we're capturing CO2 at the source of emissions. Most source carbon capture that people are familiar with right now is amine-based technology. You'll see companies like Shell, Mitsubishi, you're really the leaders here. And any of the existing plants that are out there, things like Petra Nova that have been around for a long time, are amine-based plants. What we're doing is completely different. So...

It's not completely different. It's similar, but it has a completely different outcome. So, at Mantle, we're using a molten-bore material to capture CO2. We capture high temperatures in the liquid phase. Now, what does this mean? So, we are doing the same process as Amy is doing. It's an absorption-desorption process. We're capturing CO2 during that absorption phase. We're capturing it at low temperatures. We're separating that CO2 at high temperatures.

I throw a low temperature, high temperature in quotes there because we're doing all of this at high temperatures. We absorb 400 to 600 degrees Celsius, and we desorb 600 to 800 degrees Celsius. So, extremely high temperatures. By operating at those high temperatures, we can recover steam. So, you can think of what we're doing as a boiler with carbon capture integrated. We burn fuel, generally natural gas, but really can be any fuel that's available. It can be a biomass, can be any kind of waste gas, really whatever is available. We burn that fuel. We capture all the CO2 from that system. We take a slipstream of other emissions on site as well, capture those, and produce pure CO2, 99.9 % pure CO2 that does not require any post-treatment and then steam or heat that can be used on site. The crux of what we're doing that makes this different than other people is that that steam has to be used on site. If you're not using that steam, we're just as inefficient as everyone else.

But if you can use that steam on site, what we're doing is a complete paragon shift in the way you think about carbon capture. Most of the existing technologies have a thermal energy penalty of around 2 and 1 half gigajoules per ton. So, that's 2 and 1 half gigajoules of energy for every ton of CO2 that's captured. That's the way we've been measuring carbon capture and the parasitic load of carbon capture for a long time. Mantle's thermal energy penalty is 0.1 gigajoules per ton. So, it's just a completely different way of thinking about this.

Mike Toffel:

Got it. And that 0.1 gigajoules per ton is because so much of the energy that you're creating can be reused in the form of steam, for example.

Danielle Rapson:

Yeah, exactly. So, this absorption-desorption process is a reversible process. The absorption side of things is an exothermic reaction, meaning it releases energy. And the desorption side is an endothermic reaction, meaning it uses energy. Now, when you use something like amines, it's the exact same process. You use a lot of energy on that desorption side. In the amine systems, that's generally powered by a separate power station or a boiler that you build on site. And then you generate energy on absorption.

The problem with amines is when you generate that energy, you're generating at around 50 degrees Celsius. It's waste heat. You're sending it to atmosphere. It's wasted. means that has a very high energy penalty and therefore a very high cost associated with capture. When you look at our system, we're doing the exact same process, but we're doing it at high temperatures. So, we're still absorbing and creating energy, we're still generating energy. We're still desorbing and using energy. We use just as much energy as you would with an amine system.

But when we absorb it, we recover all that energy as 600 degrees Celsius heat, which we turn into steam to use on site, driving that energy penalty down to that 0.1 gigajoules per ton and making it much more efficient process.

Mike Toffel:

And this translates into a cost advantage, I presume.

Danielle Rapson:

This translates into a lot of advantages. So, this translates into a cost advantage. Look, carbon capture is great. We all want to decarbonize the world. That's why we're here. But the reality is no one is going to decarbonize things unless there's a cost benefit to them. I'd love to think that everyone was doing this for the greater good, but we look at a lot of these bigger companies and they're doing this to save money. And so, there is a huge cost advantage to what we're doing.

You can think of what we're doing as a replacement for a boiler on site. So, if you're already burning fuel to generate steam, why not do it with carbon capture inside of it? You're burning that same fuel, you're generating the same steam, but hey, now you're getting some kind of CO2 credit, whether it's 45Q in the US or some kind of other credit. ⁓ So, it's a much more efficient way. There are other benefits as well associated with this compared to other technologies. We have a much smaller footprint. So, a lot of these sites are very space constrained.

You’re often not building new refineries or building new pulp and paper mills. So, you're really left with what is currently existing and what little plot print can you fit in right now. So, we have much more space, we have much more plot footprint than other technologies, which is ⁓ a huge advantage. And then the final one is that we have a huge environmental benefit as well. So, you generally hear me coming back to Amine since that's like incumbent technology right now, but there's a lot of concerns with anemones, carcinogens, a lot of nasty stuff in that equipment, in that solvent, and Mantle does not have any of that. Our material is completely safe and does not have any hazardous or environmental pollutants.

Mike Toffel:

Got it. So, on this whole technology-based carbon capture, one hears numbers as high as $1,000 per ton for some direct air capture, sometimes lower than that in the point source capture where you're working on much higher concentrations of exhaust fumes outside power plants or other types of chemistry plants, chemical plants, and so on.

Where are you on that journey and how does it compare to, of course, like tree planting, you often hear those carbon credits going for something, sometimes like $30 a ton. And so, in terms of saving money, it depends on what the comparison is and what's going on. So, where are you in terms of the cost per ton and what's the trajectory look like? Because I know a lot of these technologies are on massive learning curves. So, last year's costs are being reduced this year simply by tweaking the process and learning how to do it better.

Danielle Rapson:

Yeah, So, our material has been tweaked. Our material works and we're out of the science phase of that. What we're tweaking now is engineering, which is nice. We're building process plants that these engineering companies have been building for many years. So, that's what kind of what we're focused on right now. Our costs are going to be very competitive. We're nowhere near those thousand dollars a ton that you're quoting. We are aiming to be competitive within 45Q. So, right now 45Q is $85 a ton.

We expect that we can do it well under that and make these financially feasible projects that someone wants to do, meaning that they'll generate a return just off 45Q alone. And we anticipate being able to do that on the first commercial projects. ⁓ I will note one differentiation there in the credits quickly. So, with the nature credits, you're talking about things like direct air capture. So, there is a credit market there for those carbon credits. We are doing abatement meaning we are not capturing co2 from the air we are capturing co2 before it is released into the air ⁓ if we burn biomass we might get into that first credit space but right now when we're burning something like natural gas we're doing abatement credits there's not a huge market for these abatement credits So, generally where you're building your revenue stream there is either an internal credit with a company ⁓ or based on things like 45q or ⁓ things in Canada with their Canada's tax on these things like that. There isn't really a credit market per se for abatement.

Mike Toffel:

And so, unpack 45Q a bit. You've referred to that a few times, for those listeners who aren't in this space.

Danielle Rapson:

Yeah, So, 45Q is an incentive from the US government that is still around and hopefully will stay around. It pays you $85 per ton in tax credits for every ton of CO2 that is captured and sequestered. So, sequestered, meaning it is stored back underground, returned to where it originally came from. There's a lower amount on 45Q as well for utilization. I believe it's 65, but don't quote me on that. 45Q existed before this administration. So, 45Q has existed through both the Republican and Democratic administrations and is often seen as something that has bipartisan support because it supports somewhat oil and gas. It supports EOR, those types of things. So, it's a mechanism that we're hoping sticks around.

There is a very similar trading schemes in both Europe and Canada. Europe has the ETS trading scheme, which is very similar. And then Canada has a carbon tax, which ⁓ is the opposite of 45Q. So, Canada's carbon tax is somewhere around 80 US dollars right now. ⁓ It's the opposite of 45Q in the sense that 45Q is incentivizing you. They are paying you for every ton you capture. Canada has a tax, which means they are penalizing you for every ton that you put out. But all these mechanisms are great ways to incentivize these technologies to move forward.

Mike Toffel:

Okay, great. So, let's talk a little bit about where your technology is on its journey because you're still in the startup phase and you're not yet at scale with this being attached to a plant, but you're in progress. So, tell us a little about how you thought about where to put your starter plant and ⁓ both geographically and industry-wise and then what your trajectory is for the next steps as you scale up technology to full scale.

Danielle Rapson:

Yes. Sure. So, with carbon capture, we're in a race against time right now, whether it's policy, whether it's global warming, things like that. Income and technology are becoming more widespread; we're in race against time. So, we're moving very fast to try to deploy this technology as quickly as possible. We have a pilot flow loop system in our lab in Cambridge, Massachusetts. That system captures half a ton of CO2 per day. It's been around since 2022, and we run it on a batch-wise system right now.

testing different components as we're scaling up. We have a demonstration project that is currently under construction. This system will capture 2,000 tons of CO2 per year. It's located at a pulp and paper mill with a company called Kruger. They're a North American paper company. You've probably used their products and don't even realize it. They do a lot of toilet paper and paper towels, diapers, things like that. So, it's a pulp and paper mill located in Trois-Riviers, Quebec. That project is currently under construction and will be commissioned later this year. And we're really excited about getting that project off the ground. It is a project, it's a one-megawatt thermal boiler. So, it'll burn natural gas, capture all its own emissions and then feed steam into the main steam header of the pulp and paper mill, allowing the site to decarbonize 5 % of their site right now. They'll turn down their boiler and accept the steam from our system.

And then in phase two, it will take a slipstream from a lime kiln on site as well and co-capture that to capture a total of tons a year of CO2. That project will be commissioned later this year and will be a huge step in proving our technology on an industrial scale. The project is reminiscent of a larger scale project. It's just small and miniaturized. We are working on our first commercial project as well, the FOC project, what everyone's looking for in this climate tech space. ⁓ That is for a project that will be a 10-megawatt thermal system, and it will capture 55,000 tons of CO2 a year, a third of those emissions internally from itself and two thirds from another system. And it will be in the oil sands in Canada. And we're excited to kick off some engineering studies for that project very imminently. And then beyond that, we have a pipeline of other projects that we're working on and everything from feasibility to pre-feed stages right now primarily in the Gulf Coast regions in Western Canada, ⁓ areas that have existing sequestration ⁓ opportunities for the CO2.

Mike Toffel:

Got it. both of those, it sounds like all those high priority, near-term opportunities are in Canada, as you mentioned, and you're based in the US, but thinking about the US and Canada markets. Are you choosing Canada because the regulatory environment is a more stable?

Danielle Rapson:

Yeah, that's a great question, Mike. So, I will say initially, this was not that thought out. Initially, this was by accident. ⁓ We were an early-stage startup, but we were trying to get traction wherever we could, and we found an awesome partner in Kruger. We had been working with them for a long time, and they were interested in being a first mover in what we were doing. And so, we started working with them very early on to develop this project for the demonstration. Now, since then, a lot has changed. Since then, Canada has only gotten better in carbon capture. Canada has an ITC, an investment tax credit that reimburses 50 % of capital expenses on carbon capture. They have carbon tax, like I mentioned before. It's currently about $80 US a ton, and it's expected to go significantly higher, or it's projected to go significantly higher over the coming years. And they also, have an incredible regulatory environment in the sense of grants and government funding. Both the provincial and federal governments are excited to bring new technology, new companies, and innovation to their regions.

So, that trifecta has made Canada an amazing place to deploy our technology early. There's also, amazing talent in Canada. About a third of our workforce right now is Canadian and Canada based and there's some incredible engineers based in Canada. So, those four things have made Canada a really promising place for us. We have a Canadian subsidiary right now, Mantle Capture Canada, and we're opening an office in Calgary as well. Now...

I don't mean to discredit the US. There's stuff going on in the US. We have quite a few early studies going on in the US right now, and we have some early stuff in Europe as well. ⁓ But I think there's a bit of hesitation, especially given the current administration with things in the US. And so, we've been full speed ahead in Canada right now.

Mike Toffel:

Got it. And Calgary because of the oil and gas industry that surrounds Calgary, the Canada's Houston in a way.

Danielle Rapson:

Yeah, exactly. I've said that for a long time and I've been told not to say that, that the people in Houston get offended when I say that Calgary is Houston. But I think they're like, they're the same thing. Yeah, Calgary has a huge oil and gas company. There are some crazy stats that I will butcher if I try to repeat them right now about how much of the world's oil is produced in that area. But it's kind of wild walking around Calgary when you walk from Suncor's office, the CNRL's office to Exxon's office, or I guess it's the pier there, like you walk from office to office of the major oil and gas companies and they're all within like a one or two square block radius. So, it really is where a lot of this potential is and where a lot of this oil and gas world is.

Mike Toffel:

And so, we talked about why Canada, but let's talk a little bit about the sector. So, you've mentioned pulp and paper, oil exploration or oil and gas exploration refining. sounds like that's another key area. Is cement yet another?

Danielle Rapson:

So, one thing that's interesting about Mantel technology is that we're agnostic across industries. Our technology really applies to any heavy industrial assets. The key to what we're doing is that we generate steam as a by-product of capture and you really need to use that steam on site. Um, So, there's, there's often two, there's generally two plays that we're looking at when we're talking with the company about incorporating Mantel technology. The first is replacing an old boiler.

So, most heavy industrial sites have some kind of steam generation, some kind of boiler on site. Those boilers are often old. They spend their money investing in other technologies. They invest money in the technology that produces the paper or in the technology that produces the oil. But they don't spend the money on the boiler, that's just like the background noise. These boilers are often 1930s, 1940s technologies, and they're literally duct taped together. And so, Mantle will come in and what we'll do is replace the boiler. We'll burn the same fuel you previously burned, generate the same steam you were previously generating, but at the same time capture the emissions from that asset as well as other assets on site as well.

So, that's one way of doing this. And we can often get some kind of funding for that or some kind of government support for that. So, whether you really weren't thinking about replacing it, you now have some kind of way or help to replace that. The other way is steam expansion. We're seeing this in the oil sands right now. We're seeing this at some refineries sites want to increase their production, they need more steam and so, rather than installing a traditional boiler, you could install the now boiler 2.0, the new next thing which is mantle system. Now just to unpack a little bit about the specific industries. most industries do have some kind of steam or heat need in terms of a boiler. The two industries that don't that are often more challenging are cement and steel. Their needs for heat are incorporated into their other assets.

That's version 2.0 for us right now We're looking at replacing boilers and the reason for that is that that's not your important equipment We can come in you put your existing boiler on standby using Mantel technology. We're not impacting on the equipment that makes money but to impact things like steel cement we would have to come in and retrofit the equipment and so with us being an early-stage startup, with what we're doing being riskier, that's a next stage. And as we get further along and build confidence in our technology, that's something we'll look to doing, but maybe not our first foray.

Mike Toffel:

Got it. So, far, the biggest targets of opportunity because of both their high-heat needs and high-team needs are, I think you said, pulp and paper. And is it oil refining?

Danielle Rapson:

So really everything in oil and gas upstream downstream refining any kind of like specialty chemicals, combining heat and power plants, pulp and paper, manufacturing, food and beverage. The list is endless, I would say.

Mike Toffel:

I see. Cool, this is super interesting. And on the demand side, So, that's in a way like who is a target of opportunity for you, where you can make a pitch and say, maybe this our technology costs, and let me see if this is right, your technology costs perhaps a little more than just a straight boiler because it's doing more things, capturing the carbon, but with the carbon.

with the credit you get either in the US through a tax credit or in Canada through investment credits and by avoiding a tax, the Canadian carbon tax that you said is around 80 US dollars, that compensates or even more than compensates for using this new technology. Is that the right pitch? Is that the take of that?

So, you mentioned this Pulp and Paper company was very excited to start to partner with you and be an early adopter. Where else are you seeing enthusiasm for this technology? Are there industries or brands that seem particularly on their foot trying to get involved in this area?

Danielle Rapson:

Yeah, that's a great question. So, we've seen a lot of large companies, a lot of large oil and gas companies ⁓ who are very interested in this. think they have an existential crisis coming to them. How does oil and gas stay relevant? How is that something that continues to exist in different geographies, across different administrations, things like that? And this is one way to really keep oil and gas going, clean up oil and gas. So, we're seeing a ton of interest, from the oil and gas world, from their refineries, from their power plants, from their chemical refining. ⁓ We see a ton of interest across Canada, I would say across all industries. The key there being that it's like the carrot and the stick. The US is dangling carrots. You can make money doing this. Canada has a stick. It is currently hitting their bottom line if they emit carbon. And so, I would say it's completely industry agnostic right now across Canada that everyone is looking to do this and fears the potential if they don't do this.

Mike Toffel:

And has there been any debate amongst your employees or investors in working with oil and gas? Because I know some folks who want to go into business and climate say, you know, oil and gas, that's the past and let's work on the future. We're going to work on solar and wind or other technologies, hydrogen, green hydrogen. And here you are helping oil and gas clean up and decarbonize. And there's lots of people who think that's exactly what we need to be doing or all the above strategy, but others are a little bit shy in working with oil and gas. So, industry agnostic that it's not even an issue?

Danielle Rapson:

Yeah, Mike, that's a great question. I think that's something that came up. That's something that came up while we were raising some of our rounds. ⁓ We made the decision early on that we were going to work to decarbonize and to clean up industry. ⁓ Things like wind and solar are fantastic, but they're not at the scale right now that they can completely decarbonize our world. So, your options are to partially use renewables or to burn natural gas or burn coal or things like that. And so, we really think that that transition period is important and being able to clean up those industries is important. So, we were really interested in partnering with those two of our biggest investors, our Shell Oil and then our Shell and Eni, an Italian oil major. And so, we're really excited about working with them to decarbonize their operations and similar operations. I will note that Mantel technology could burn hydrogen. Mantel technology can be electrified.

Right now, we're working on natural gas-fired systems primarily, mainly because it's the cleanest fuel and it's just the easiest to implement. And so, it's the easiest way to de-risk our technology. But if electrification hits electricity prices of $0 or hydrogen hits the sub $1 per kilogram that some people think, then we could fire those same systems. We could hire hydrogen and take advantage of those savings as well.

Mike Toffel:

Is it currently characterized as like a, could you do dual fuel now or would you have to modify your technology to be able to accept different fuels depending on dynamic pricing?

Danielle Rapson:

We'd have to modify it, but I wouldn't say it's like, it's not a significant modification. It would be the same as looking at any existing boiler you would have to modify. It's not really a mantle technology innovation. It's like a boiler technology innovation.

Mike Toffel:

Right, right, got it. And so, we've gone as far, your technology helps to strip the carbon out of these point sources to prevent it going, as it leaves the exhaust plume, you're capturing it and preventing it from hitting the atmosphere. And then you have carbon in liquid form, I presume. You said 99.5 % pure. Nine.

Danielle Rapson:

99.9%. So, totally pure CO2, pipeline grade, does not require any post-treatment, which is important because of a lot of other technologies, you must add another technology on after to make it pipeline grade. ⁓ It comes out in, well, we would compress it then basically, So, it's pipeline quality.

Mike Toffel:

And then where does it go? Who uses it?

Danielle Rapson:

It's a great question. So, we are really focused on the capture stage of things, and we are agnostic as to what happens next. We're working with different people, depending on geography primarily, to figure out what's next. So, whether it goes into a pipeline to be sequestered underground, whether it's going to be a utilizer, the technology is, our CO2 is pure enough to really serve any of those purposes and we're partnering with different people and different players in different ⁓ regions of the world to enable that portion.

Mike Toffel:

Got it. But its fate influences the tax or subsidy in some places, like whether it's reused and it avoids the need for CO2 or for other fossil fuels elsewhere. So, there's a utilization story versus a sequestration story. So, does it impact your side or your partner's side? What happens to it?

Danielle Rapson:

It impacts the overall project economics. For example, in Canada, the ITC does require that it's sequestered. Western Canada has the geography for sequestration out in Alberta and Saskatchewan, So, you are seeing a lot of pipelines start to go up, you're seeing wells drilled, and you're seeing this starts to happen. I will note that sequestering, not necessarily sequestering, but putting CO2 underground is not something new. We've been doing EOR, enhanced oil recovery, for many, many years.

And so, this is not something new. It's something that we've known how to do for a long time. So, in regions like that and in regions on the Gulf Coast where there's already a pipeline infrastructure being built out or that has been built out, then you're seeing the sequestration. Now, you pick some random geographies. There's not necessarily a pipeline network there. And so, sometimes you must get a bit more creative about what you're doing with CO2. ⁓ So, if you start looking at a plant in New York, there's not a pipeline infrastructure there start to get creative often with other startups of what are the utilization opportunities that we can do with the CO2.

Mike Toffel:

Right, and there's a market for CO2. People use it as an industrial ingredient.

Danielle Rapson:

There's absolutely a market. I would say as a company get a little bit nervous about stacking risk on risk. And what I mean is us as a startup coming in with new technology, then working with another startup on the utilization of technology. So, it's a little bit cleaner, safer, I would say, to go the sequestration route with using less new technology per se. But there's a cool utilization company that is out there that are doing some amazing things that we're hoping to work with.

Mike Toffel:

Yeah, well, and that's it. seems to me like your job, like any team of startup co-founders with a small team that's pursuing these opportunities are doing a bit of everything, which is one of the big differences in working for a small firm versus a large one. You have eyes on a wider variety of functions, I think. And you get to know all the people in your team quite well because the team is still small.

As you think about scaling, So, there's technological risks that you're overcoming, or you called it engineering risk, which in a way maybe are less risky because the core technology has been proven out. And I think you said the scaling issue is more engineering, which is a much more well-known science. What are the barriers to scale in your sense?

Danielle Rapson:

Yeah, So, I think speed to market is really one of the barriers in some ways. These projects are not something that you develop overnight. These are projects that take years and years to develop and there's just not a lot you can do to change that. You walk through the traditional project development mindset, and you start with a feasibility study, then you go into a pre-feed study, then a feed study, then detailed design, and then eventually you build the plant and commission and operate it. And so, that's a multi-year process and over that time horizon a lot can change administrations, governments, policy support can change, company ownership or internal support can change. And so, there's just a lot that can't go wrong over that time horizon. So, I would say that's probably the biggest challenge and things we're mitigating by trying to move faster, trying to de-risk as much as possible ahead of time, things like that, having multiple suppliers, things like that. But that's probably the biggest challenge. What can we do to speed up or what can we do to remove these challenges?

We're working to build the best team possible. We're only as strong as our people, So, we've really worked to build a team that can support all of this. We're working to really build some fantastic partnerships, recognizing that these big companies have a lot of power and what they want to do can really influence what we're doing. Bringing on some amazing investors and advisors that support us along the way. All those types of things I think are going to help us hopefully to be as successful as possible.

Mike Toffel:

Yeah, yeah, no, for sure. I mean, maybe someday, right? But it's one thing to get the wrong citation ⁓ in a law brief, which has its own penalties. when you're talking about engineering, of course, it's a regulated market as well. So, everything needs to be signed and sealed by process engineers and by regulators as well, I imagine. So, what about the race between your technology and the incumbent technologies that you're fighting against.

I'm sure they're also experiencing learning curves and trying to reduce as quickly as possible their technologies. You mentioned efficiency and steam as an advantage of yours. And of course, the big power difference of two and a half gigajoules per ton versus your 0.1 gigajoules per ton. And that seems like an enormous difference. But are there other advances? On your competitor's side that are keeping you awake at night, or do you feel like that's just a different market?

Danielle Rapson:

So, we like to say that we're excited about the whole market being built out. If our competitors make it, what that means is that there's more pipelines being built, there's more sequestration. The overall market is growing and that is a huge win for us. So, in a perfect world, I think like you just mentioned Mike, there are So, many assets that need to be decarbonized. So, if other people can increase their technology, come to the table and help increase the landscape here, it only benefits us and all of us in the long term.

We do believe our technology is the best, it is the most efficient in the end for most use cases, but really everyone succeeding benefits us significantly.

Mike Toffel:

Do you have put a number around the total addressable market for your technology? I imagine some investors might be excited to hear a big number.

Danielle Rapson:

So, we do think that there is a huge opportunity for carbon capture, huge market opportunity for Mantel. the total addressable market in the United States right now is around 1.6 trillion.

But what we really look at often is the SAM, the Serviceable Addressable Market. Where does Mantle's technology make sense? Where is Mantle profitable today with today's current incentives? And so, we look at that number as being about 200 billion worldwide or about 120 billion in the US. If you break that down one more time to the Serviceable Obtainable Market.

And so, that is with this, we talked a little bit about Mantle's technology 1.0, 2.0, the technology that we can decarbonize right now versus steel cement that we're not looking at right now. So, if we look at the that 1.0, that's about 45 billion worldwide and about 25 billion in the United States alone. So, huge market here, a huge market potential.

Mike Toffel:

Yeah. Let's talk a little bit about your fundraising process, because I know some people who are listening here are interested in the financing side. So, who did you look to as possible funders for your startup? And tell us a little bit about that journey. Where were you receptive? Where did you get good advice? Any advice that you have for others who are looking similarly to raising capital for climate tech startups?

Danielle Rapson:

Sure. So, once you choose an investor, you're married to them. They’re here for the long game. We spent a lot of time really making sure we were aligned with the right investors and people that really invested in Mantle's success, not just financially, but really invested in the company. We did raise a seed round initially. We were supported by the Breakthrough Energy Fellows program. And then we raised a small seed round with the Engine. The Engine is a venture capital firm based out of Cambridge. And they've been a fantastic, fantastic partner with us right from the beginning really when it was nothing more than just myself and my two co-founders. So, they've been a great partner from the beginning. We raised Series A, raised $30 million Series A about midway through last year. That round was led by Shell, Shell Ventures and Eni, which is an Italian oil major. They've both been fantastic partners. As we look to scale this up, they've been able to provide a lot of advice from the actual customer side, from the industrial side of how we look to do this.

We had participation in that round from the engine again, from BP, from Vale, and from several other industrials and financial firms. And then we will look to raise a series B next year, on the back of the demonstration project success, we'll look to raise a series B to help move us towards this commercial project. In addition to all of that, we have raised a significant amount of non-dilutive funding as well. We've raised a significant amount of money primarily from the Canadian government, the Canadian federal and provincial government, to support our demonstration project. And so, it's been a great pairing of both dilutive funding as well as non-dilutive funding.

Mike Toffel:

Interesting. And where did you learn about all that fundraising prowess? Where to look? Is this just something you learn on the job? Basically, as you're, I guess the engine and breakthrough might give you some input.

Danielle Rapson:

A lot of trial and error would be said. Yes, and a lot of input. I will note that Cameron, my co-founder and CEO, runs a lot more of the financing side of a lot of fundraising side of it. I run a lot of day-to-day operations and project work, but it's been a fantastic pairing of knowledge between Cameron and Sean, who is our CTO, and myself to figure all of this out.

Mike Toffel:

And I forgot to ask earlier on, but you mentioned these two of your co-founders are both MIT PhD students. Did this technology come out of their work at MIT?

Danielle Rapson:

Yeah, So, this work was Cameron's PhD work. So, Cameron spent several years in the Hatton lab at MIT working on this, discovered the new material, and then was interested in doing something with it. He brought it to the MIT Climate and Energy Ventures class, and we worked on it as that class project and spun it out.

Mike Toffel:

Super interesting. Great. So, for those interested in this journey or in this industry or moving from either an MBA or wherever they are in their career and trying to think about opportunities in climate tech startups, whether it be carbon capture or otherwise, what advice do you have for them in terms of figuring out their journey? Either resources that they should attend to or experiences they should engage in, upon reflecting on your own career and meeting others in this space, what do you think is helpful for them on their journey?

Danielle Rapson:

That's a great question. So, I would say it depends a little bit on what stage you are at in your career. So, if you're an HBS student, if you're an MBA student or college student in general, I always tell people get as many internships as you possibly can. ⁓ During an MBA, it's short. You get a summer internship. But during the year, interns offer to help and work on a project with a startup. It's not for the money. It's to learn and understand what is going on. There are very few startups that are just going to hire you blindly coming out of school. They are hiring in a startup is risky, right? Like right now I have 30 people, at one point I had five people, each one of those hires is very important. So, look for opportunities you can work for a startup, whether it's you 10 hours a week during a semester, whether it's a class project where you can work directly with the COO, look for any opportunity you can engage. I also suggest working with, and this is more startup based than climate based, but trying to work with startups at different stages. Go work with a seed start up, go work with a series B or series C startup because you'll realize that the way things work and what you can be involved in is very, very different between those two. That's not necessarily obvious from the outside. There are some great podcasts out there, some great resources to learn more. I love the MCJ, My Climate Journey podcast. They're also an incredible investor and mantle and they seem to know absolutely everybody in the landscape for carbon capture, for Climate Tech, So, great place to look. This podcast is a fantastic way to see what's new, what's out there. And then there's lots of good newsletters that you can sign up for as well

Mike Toffel:

Well, thank you So, much for interesting conversation, Danielle. I really appreciate you spending time with us here on Climate Rising.

Danielle Rapson:

Absolutely, Mike, thanks for having me.