Developing a funding roadmap for the journey from idea to scalable circular (chemical recycling) business may be challenging. Polestar Capital discussed how timing, risk profile and amount determine what type of financier and financial instrument may be the best match during what phase of the growth path, at the Dutch Chemical Recycling cluster on June 3 of 2020. Interested in this topic? Or looking for financing? Please contact Polestar Capital via dvk@polestarcapital.nl

1. Polestar Capital | June 2020 | Financing chemical recycling scale-ups 1
Polestar Capital
Financing the growth
path of chemical recycling
scale-ups
Presented at “the webinar on financing of
chemical recycling businesses in the
Netherlands”, organized by Rebel Group

2. Polestar Capital | June 2020 | Financing chemical recycling scale-ups 2
Funding need in € mln
Commercial risk
Technological risk (TRL 1-9)
The journey of financing an innovative chemical recycling business
The first step in financing a chemical recycling business, is understanding the journey of such business from an initial concept towards
a scalable business, including the various types of funding needs and available types of financing along the way.
t (1/2 years)
Idea
Tested idea
Plan for a business
Startup organisation
Businessplan & businessmodel
Technical testing at lab scale
(Production) testing in existing facilities
and/or construction of a R&D plant
Planning, construction and commissioning of the first
(almost) commercial scale production line
Proof-of-principle
Proof-of-concept
Proof-of-technology
Planning, construction and commissioning of replication and/or larger scale plants
Proof-of-scalability
▪ Relative small funding need (typically €0,1-1mln)
▪ Funding need at holding (not plant) level
▪ High organizational, technical and commercial risk
▪ No collateral (if financed as stand alone start-up)
▪ Financiers require a very high reward (IRR) per € invested
Discovery
Typically provided by:
▪ Founders and relatives (equity)
▪ Angel investors (equity)
▪ Subsidies (equity)
unbankable
unbankable
bankable
bankable

3. Polestar Capital | June 2020 | Financing chemical recycling scale-ups 3
Funding need in € mln
Commercial risk
Technological risk (TRL 1-9)
The journey of financing an innovative chemical recycling business
The first step in financing a chemical recycling business, is understanding the journey of such business from an initial concept towards
a scalable business, including the various types of funding needs and available types of financing along the way.
t (1/2 years)
Idea
Tested idea
Plan for a business
Startup organisation
Businessplan & businessmodel
Technical testing at lab scale
(Production) testing in existing facilities
and/or construction of a R&D plant
Planning, construction and commissioning of the first
(almost) commercial scale production line
Proof-of-principle
Proof-of-concept
Proof-of-technology
Planning, construction and commissioning of replication and/or larger scale plants
Proof-of-scalability
▪ Relatively small funding need (typically €0,5-10mln)
▪ Funding need at holding (plant does not offer funding
benefits) level
▪ High organizational, technical and commercial risk
▪ Illiquid and relatively low collateral
▪ Financiers require a high reward (IRR)
Development
Typically provided by:
▪ Subsidies (equity)
▪ Angel investors and early venture
capital investors (equity)
▪ Innovation credit (debt)
▪ Regional development agency
instruments (equity or debt)
unbankable
unbankable
bankable
bankable

4. Polestar Capital | June 2020 | Financing chemical recycling scale-ups 4
Funding need in € mln
Commercial risk
Technological risk (TRL 1-9)
The journey of financing an innovative chemical recycling business
The first step in financing a chemical recycling business, is understanding the journey of such business from an initial concept towards
a scalable business, including the various types of funding needs and available types of financing along the way.
t (1/2 years)
Idea
Tested idea
Plan for a business
Startup organisation
Businessplan & businessmodel
Technical testing at lab scale
(Production) testing in existing facilities
and/or construction of a R&D plant
Planning, construction and commissioning of the first
(almost) commercial scale production line
Planning, construction and commissioning of replication and/or larger scale plants
Proof-of-scalability
▪ Large funding need (typically €1-150mln)
▪ Funding need at both holding (organization & commercial
development) & plant (engineering, construction, commissioning,
etc.) level
▪ Medium-high organizational & technical risk, high commercial risk
▪ Illiquid and relatively low collateral
▪ Financiers require a medium-high reward (IRR)
Demonstration
Typically provided by:
▪ Regional impact investment
funds & Regional
development agency
instruments (equity or debt)
▪ Corporate stakeholders
(feed-stock, off-take and
technology partners)
▪ Venture capital, private
equity and strategic
shareholders (equity)
▪ Subsidies (equity)
▪ Leasing of standard
installations (debt)
▪ Banks (smaller debt tickets)
unbankable
unbankable
bankable
bankable

5. Polestar Capital | June 2020 | Financing chemical recycling scale-ups 5
Funding need in € mln
Commercial risk
Technological risk (TRL 1-9)
The journey of financing an innovative chemical recycling business
The first step in financing a chemical recycling business, is understanding the journey of such business from an initial concept towards
a scalable business, including the various types of funding needs and available types of financing along the way.
t (1/2 years)
Idea
Tested idea
Plan for a business
Startup organisation
Businessplan & businessmodel
Technical testing at lab scale
(Production) testing in existing facilities
and/or construction of a R&D plant
Planning, construction and commissioning of the first
(almost) commercial scale production line
Planning, construction and commissioning of replication and/or larger scale plants
▪ Substantial funding need (typically €150mln+)
▪ Predominantly at asset/plant-level, smaller funding need at
holding level (organizational and commercial costs)
▪ Low-Medium organizational, technical risk & commercial risk
▪ Significant collateral, stronger contractual risk mitigation
▪ Financiers require a Low-medium reward (IRR)
Deployment
Typically provided by:
▪ Banks (Debt)
▪ Strategic investors (f.i.
corporates in the value chain)
▪ Private equity (equity)
▪ Leasing of standard
installations (debt)
unbankable
unbankable
bankable
bankable

6. Polestar Capital | June 2020 | Financing chemical recycling scale-ups 6
1. Discovery
▪ Ideation: Proof-of-
principle
▪ €0,1-1mln budget
▪ Development of a
businessmodel
▪ TRL-level 0-4
▪ Focus on
completion of the
start-up team and
development of the
business model
2. Development
▪ Proof-of-concept
▪ €0,5-10mln budget
▪ Realisation of R&D
center (sub-
commercial scale
demonstration
plant)
▪ TRL-level 5-6
▪ Focus on technical
validation,
engagement with
feedstock & off-take
value chain
partners
3. Demonstration
▪ Proof-of-technology
▪ €1-150mln budget
▪ Realisation of a 1st (and 2nd)
commercial scale plant
▪ TRL-level 7-9
▪ Focus on building a replicable
and scalable technical and
operational (production facility)
business model. Formalization of
processes, procedures,
agreements and models in order
to be(come) bankable
4. Deployment (growth)
▪ Proof of scalability (proven technology)
▪ Multiple of construction phase budget
▪ Realisation of replication plants
and/or larger scale production facilities
▪ TRL 9
▪ Focus on building scale, often in
cooperation with strategic waste,
processing or roll-out partners
The typical growth path of technological innovative production businesses consists of the following 4 phases, time path and impact:
Summary: The growth path of chemical recycling innovators
Innovative chemical recycling innovators follow a growth path with different types of investments (risk-return profiles), funding needs
and offered securities along the journey. Financiers offer different financial instruments available (f.i. debt vs equity) and have different
objectives with their financing (f.i. impact vs returns). Matching funding needs and available financial instruments may be challenging.
Accumulated total tons of
processed waste,
substituted fossil resources
and avoided CO2
Financed by Polestar Capital Indirect / Long term impact Polestar Capital
Funding gap experienced
by Polestar Capital
By solving the funding gap for circular innovators,
during the “demonstration” phase, Polestar Capital
enables / accelerators their growth path towards large
scale impact

7. Polestar Capital | June 2020 | Financing chemical recycling scale-ups 7
Contact details
Polestar Capital
Groest 106, 1211 EE Hilversum
+31 35 240 01 08
info@polestarcapital.nl
Daan van Kassel
Investment Manager – Circular Economy
+31 6 14 86 54 14
Dvk@polestarcapital.nl