Alex Rappaport, CEO & Co-Founder, ZwitterCo recently raised one of the largest Series A funding rounds in history for a water technology company, to expand the development and production of his zwitterionic membrane technology.
Achieving $33m funding
“I was never going to be a good engineer. I used to say things like ‘I want to work on problems’, but found that I was too impatient to follow a direct path through an engineering curriculum. Creative and thoughtful engineering is essential for developing breakthrough technologies, but I found entrepreneurship was personally a better medium for me to connect those breakthroughs with urgent environmental challenges.”
These are the words of Alex Rappaport, CEO & Co-Founder, ZwitterCo which recently raised one of the largest Series A funding rounds in history for a water technology company, to expand the development and production of its zwitterionic membrane technology.
The membrane manufacturer recently secured $33 million in financing, led by deep tech investment group DCVC. The round also featured investment from Heritage Group Ventures, Genoa Ventures, and Mott Corporation, and existing investors MANN+HUMMEL Corporate Ventures, Burnt Island Ventures, and R-Cubed Capital Partners.
Sharing his secret to success and the record raise, Rappaport says with water scarcity becoming an ever-increasing problem, not just in third world countries but in the US too, it had led to a general spirit of wanting to get ahead of the issue, and new funding was coming out at state and federal levels.
“We knew it was important to create a fully outsourced production model. Our thinking was to produce commercially viable products that could immediately unlock new processes, or profound water reuse opportunities,” he says.
The early days
So where did ZwitterCo’s journey begin?
Back in 2013, Dr. Ayse Asatekin, a chemical engineering professor from Tufts University and a team of PhD and postdoc students began tackling the issue of membrane fouling and designing membranes that could be industrialized and scaled up.
The work included experiments on various tough-to-treat streams, such as wastewater and soybean oil emulsions, and comparing the performance of their membranes to standard ones. They found that their zwitterionic membranes had better permeability and were more efficient in keeping the membrane clean compared to other types of membranes.
It was a 1,500 PPM soybean oil emulsion mixed with surfactant in water, which resulted in death to the comparison polyethersulfone membrane that was being tested. However, the zwitterionic membrane demonstrated no loss of permeability for over seven days in a dead-end filtration study, where oil was forced against the surface. This finding, along with many other experiments, led to patents and inspired research into improving sustainable membrane technologies.
While pursuing his Master’s degree, Rappaport approached Dr Asatekin about using her research for his thesis. She supported the idea and they worked together to build on the research and consider its potential applications. Together, they explored various product capabilities, uncovering numerous possibilities for expansion.
“There were numerous issues regarding disposal processes, including throwing wastewater down the drain, paying municipal fees and rising water costs, which led people to seek water reuse solutions. But many end-users and customers were not enthusiastic about this idea,” says the co-founder.
The potential of water reuse
A lot of early customer discovery was spent identifying the industries that had the potential for water reuse but required the right tools to recycle water more affordably than previously possible.
“Even in the early days, there was a strong demand and enthusiasm from across a number of industries, which reinforced the belief that it was the right time to invest in planning for advanced infrastructure to promote water reuse and sustainability,” adds Rappaport. “Even though many end-users and customers were interested in water reuse, they were still far away from implementing this idea.”
So what is the ‘secret sauce’ that enables ZwitterCo’s membrane to treat challenging wastewaters, without being plagued by fouling?
The entrepreneur says they used to follow standard rules of thumb around filtration systems, but their bench testing revealed that their products were capable of 99 per cent recovery in certain wastewater applications. ZwitterCo’s first commercial plant ran successfully for six months without membrane cleaning.
“These results were impressive. In almost all cases, the membranes would only need to be cleaned with a simple water flush or a mild alkaline bleach wash” he says. “We've been learning new things about our product as more people use it and we continue to provide the architecture to enable experimentation and new proposition discovery.”
The fundamental chemistry advancement here isn't just the material itself, it's the way the membrane comes to life. The membrane is produced using a self-assembly mechanism, says the co-founder, which controls the chemistry inside the pores. In such environments, having hydrophilic surfaces can help with things like fouling resistance.
“What you're looking for is a smooth surface at the top of the membrane and hydrophilic chemistry throughout the entire pore structure where the fluid and water molecules interact with the membrane during filtration. It's preferable to have surfaces that love grabbing onto water molecules because it creates an almost protective film,” adds the CEO.
Organic compounds, such as oil, fat, and protein, are constantly trying to adhere to the surface and find regions that are chemically or mechanically stable. However, with a hydrophilic membrane that grabs and holds onto water molecules, it's difficult for them to adhere, and constant flushing of the surface will repel them, preventing fouling.
Essentially, the method prevents fouling from entering the membrane itself, which is where the most serious membrane fouling issues occur. This dramatically extends membrane life and reduces the need to clean with large amounts of chemicals.
Challenges and opportunities
“One of the surprising things we've discovered is that scaling up our products has been easier than we anticipated,” he says, adding that he owes a lot of credit to the inventor of the chemistry and the technical team.
“As we increased the scale of our product, we found we were able to maintain performance and even exceed our expectations. At pilot scale, we exceeded what we thought was possible at bench scale, and at commercial scale, we exceeded what we thought was possible at pilot scale.”
As a natural problem-solver, the young CEO has to date found scaling the company as an “educational journey”.
Now, after raising the record Series A financing round, he says his motivation has been driven by the core concepts of the purpose. Yet, he says raising such a large sum of money means he needs to ensure that he has the resources to keep growing.
“Over the past four or five years, there have been many challenging experiences and tribulations in this business world,” he adds.
Protecting the membrane IP
ZwitterCo holds patents and possess a wealth of knowledge, both positive and negative, gained from its experiences over the past few years.
Rather than seeing the company as competing with existing membrane companies, instead the vision is to see their role as “expanding the market for membranes through a variety of applications”. As a result, ZwitterCo engages in several collaborations with major membrane companies, as well as solution integration companies, for future product development, manufacturing supply agreements and generating new ideas.
“Our approach to membrane production is fundamentally different from the market, rendering direct comparison unfeasible,” concludes Rappaport.
“There are terrific opportunities to collaborate in new market segments with some of the major membrane and wastewater equipment companies. As we plan to distribute broadly, we see value in channel or distribution partnerships with major players where both parties can benefit. Ultimately, membrane world. As water becomes an increasingly pressing issue, we must work together to leverage the opportunities presented,” he concludes.
Growth and the future
What does the future hold for the co-founder and ZwitterCo?
Following the Series A, the team is now ready to launch its grand opening of a 30,000 square foot innovation center in Massachusetts. The facility is focused on end-to-end membrane production, from testing to product development, and through to initial market delivery. .
As a co-founder who enjoys solving problems, there is no doubt further headwinds and market challenges ahead for Rappaport, as the business moves from start-up to scale up. However, the ability to unlock a market segment previously inaccessible for membrane companies should be applauded.
