Novoloop’s recycled plastic is nearing production

TechCrunch has learned that plastics recycling company Novoloop has signed an agreement with a major manufacturer to provide recycled thermoplastic polyurethane on a industrial scale.

The agreement helps push Menlo Park-based Novoloop into the so-called “valley of death” that many climate tech startups must navigate.

Hardware-dependent startups are especially liable to hitting the trough – the dreaded moment where they have proven their initial technology and did not generate enough revenue from sales of their product.

Under the terms of the agreement, Novoloop will supply Huide Science and Technology with a chemical building block used to provide thermoplastic polyurethane. Novoloop makes this material, often known as polyol, from post-consumer polyethylene waste comparable to plastic bags, and it is one of the most difficult materials to recycle.

Thermoplastic polyurethanes, or TPU, are a sort of plastic used in every part from trainers to medical devices.

“We have essentially achieved a commercial relationship with this product line,” Novoloop co-founder and CEO Miranda Wang told TechCrunch.

Wang said Novoloop currently has limited capability to produce polyols. Earlier this 12 months in India, the startup launched a demonstration plant that may produce several dozen tons of fabric per 12 months.

The demonstration plant’s capability is sufficient to provide enough TPU for “large pilot projects,” Wang said, including one for a footwear client to be announced in the coming months. Previously, Novoloop supplied Swiss shoe manufacturer On with Lifecycled material for the tread of its Cloudprime sneakers.

Deals like the one with Huide will likely be key to Novoloop’s progress, Wang said. “The biggest obstacle to profitability is economies of scale,” she said. “Next 12 months there will likely be a big focus on closing a lot of customer deals so we are able to fund [commercial-scale] amenities.”

Wang said that once agreements are concluded and financing is finalized, Novoloop expects the industrial plant to be operational in early 2028. The first version should have the ability to deliver enough polyols to provide roughly 16,000 tons of TPU per 12 months.

“Once we are able to produce materials in these types of quantities, we expect that we will be able to maintain price parity with virgin TPU,” she said.