Algae biofuel outfit GreenFuel Technologies has laid off 19 people, or about half of its staff, another sign of the difficulty that fledgling alternative fuels face.
A company representative confirmed the staff reduction on Monday and said one of GreenFuel's two major customers--the Aurantia cement factory in Spain--remains a customer.
An algae bioreactor from another algae fuel firm, PetroAlgae.
(Credit: PetroAlgae)GreenFuel has developed a method for growing and harvesting algae in a greenhouse. The idea is to locate the greenhouses near a large carbon dioxide emitter, like a cement factory or power plant, to "feed" the algae. The algae is then harvested, dried, and turned into biodiesel or feed food.
Company CEO Simon Upfill-Brown, who was recruited last year from Dow Chemical to head the 8-year-old firm, told Xconomy that the engineering for its Spanish deal, previously estimated at $92 million, will be outsourced.
"We've got to weather this economic storm as best we can," Upfill-Brown said. "This is the right thing to do."
A person claiming to be a former contract worker at the company said GreenFuel's Aurantia customer was dissatisfied because of several months of delays.
GreenFuel was one of the first companies to get funded to commercialize algae farming, and there are now several companies and researchers studying methods for turning algae into fuel.
But the company has had its missteps. Its first test facility at an Arizona utility produced too much algae, making the harvesting very manual and driving up the cost of operation. It replaced its CEO, putting investor Bob Metcalfe in charge for several months.
GreenFuel isn't alone in running into stumbling blocks, though. Many clean-tech companies are hunkering down, seeking to preserve cash so they can finish developing products.
Biofuel firms seeking to commercialize their technology are particularly vulnerable to the financial industry meltdown. Demonstration plants require large amounts of money to build. But investors have become more risk-averse, making it tougher for relatively unproven firms to demonstrate and fine-tune their technologies.
Can these guys ever stay out of the news?
Tesla Motors is wrapping up a $40 million round of funding and will then seek another one on top of that in a few months, according to an interview with CEO Ze'ev Drori in VentureWire (subscription required).
Tesla has already raised more than $100 million. The money was largely used to develop the Tesla Roadster, an all-electric sports car coming out later this year, and build out the company's facilities. Car factories cost a lot. The onerous capital requirements, along with the long development time, are two of the reasons you don't see a lot of car start-ups make it to maturity. Still, when companies get past the $100 million mark in funding without releasing a product, eyebrows start to go up in Silicon Valley. Something about that number tends to bring out skeptics.
Despite the long odds for a car company, many are trying. There are well over 20 electric and hybrid car start-ups, ranging from economy car specialists like Miles Automotive to high-end hybrids like the ones from Fisker Automotive. Then there are the three-wheelers from Venture Vehicles.
Tesla has had a rocky time lately. In 2007, it delayed the release of the Roadster from last year to this year, fessed up to problems with the car's transmission, and swapped CEOs.
The delay of the Roadster could, possibly, lead to delays with the company's plans to come out with an all-electric sedan. Tesla has been hoping to come out with that in late 2009 or early 2010. Getting the price of an electric sedan to the $50,000 or less mark is tough because of the price of batteries. Interestingly, company execs have even complimented the Chevy Volt, which uses gas and electric power. A Volt type of car can be built for less and have a longer range, hypothetically, than a pure electric.
Recently, it also said it had cut around 26 employees, or 10 percent of its staff. Tesla denied layoffs were occurring back in December. These terminations, it says, relate to employee performance.
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