That's what Serious Materials recently managed to raise for its EcoRock line of drywall set to come out next year. The reason investors are so excited about something seemingly so banal: Serious claims its drywall takes 90 percent less energy to produce than standard drywall, resulting in 98 percent less greenhouse gas emissions. When talking about an industry that creates 25 million tons of greenhouse gases each year, those numbers are significant enough to attract some attention.
"We look at it as the beginning of a new industrial revolution," says Serious president and CEO Kevin Surace. "What you're seeing is the opportunity to take everything that we do around us and get on the right side of the energy curve."
Serious Materials, a Sunnyvale, California-based company known for its Quiet Solution line of noise-reducing building materials, didn't start out with such a green agenda. After listening to builders who used Quiet Solution products, however, Serious saw an opening for more environmentally-friendly materials. Now, the company is using its previous construction experience to do what's best for the environment. "Everyone here is focused on doing that, and they're passionate about that," says Surace.
By Surace's calculations, buildings account for 50 percent of the greenhouse gases released each year in this country, when the carbon dioxide produced by the manufacture of materials is added to emissions caused by electricity, heating and cooling. In contrast, cars and trucks account for just 12 percent of greenhouse gas emissions. "It's not talked about because people don't know what to do about it," Surace says. Serious believes it has found a solution in EcoRock, although it doesn't claim to be able to change the entire industry overnight.
EcoRock, which matches traditional gypsum drywall in appearance and performance (but not in price), is geared specifically toward LEED buildings. While some of the larger industry players may see that as a niche market, Surace only sees continued growth. "I can't imagine a bigger space over the next two decades," he says. Surace follows the prediction that LEED-certified projects will grow from 10 percent of current buildings to 40 percent in the next five or ten years.
Surace is also banking on upcoming expected changes to the LEED standards that will put more emphasis on the environmental impact of the entire life-cycle of building materials, from production to implementation. (Rob Watson, one of the developers of LEED, is on Serious' advisory board, so the company has a pretty good idea what the United States Green Building Council has up its sleeves.)
"Everything is moving in this direction," Surace says. "I think that old-line industry may not see it, it may not be obvious, and they might not be able to do anything about it." As a relative newcomer, Serious can see those changes and execute them — and hopefully make a lot of money in the process. "I think in this field, if you really do your duty it will pay back in spades," says Surace.
Serious' recent round of fundraising takes advantage of a growing trend in Silicon Valley for investing in eco-friendly technologies. "In the Valley here, this is all anyone is talking about," says Surace. "They will talk about Facebook's numbers…and then they go right back to, 'What are you doing in cleantech?'"
The $50 million in VC funding will go towards constructing the manufacturing infrastructure the company needs to get EcoRock on the market by mid-2008, Surace says. "We want to get enough manufacturing capacity not only to build a large company but also to have an impact on the environment."
For more on LEED, check out The Green Standard?