Finnish startup Innomost nets millions for birch bark compounds to make sustainable cosmetics

Finnish startup Innomost raises €5M to bring their birch bark innovation into new markets as a sustainable alternative for environmentally harmful ingredients in consumer products. The funding round was led by Metsä Spring Ltd. with Innovestor and angel investors joining the round. The round was completed with grants and loans from Business Finland as well as other public financing sources.

The funding will be used to set up a pilot plant in the Finnish town of Kokkola. Innomost aims to build a production facility capable of producing 20 tonnes of birch bark products per year by 2023. Capital will also go towards further R&D work, as well as growing their existing customer base in international markets. The pilot plant will be used to test and plan the process for the next industrial-scale plant.

Consumers want to use natural, renewable, and sustainable cosmetics that are good for them and for the world. The majority of ingredients and packaging materials used today, however, are made from fossil fuels, plastic or palm oil, which are associated with many environmental and ethical issues.

Innomost develops and produces high-value bioactive ingredients from forest industry side streams that enable its customers to make groundbreaking innovations in the cosmetic beauty industry. By using birch bark side streams, Innomost can upcycle naturally occurring raw materials that would normally be used for energy production or other lower value purposes into high-quality products. The products are more environmentally sustainable, as they derive from a renewable carbon source rather than similar fossil fuel-based materials.

“It’s really a win-win situation. The raw materials for Innomost’s products are available in large volumes at a feasible cost. Our raw material originates from Nordic forests, not from lands that could be used for food or feed. We are on top of the new beauty trend for upcycling, zero waste and full-cycle natural cosmetics,” said Sami Selkälä, CEO and Founder of Innomost.

“We are very grateful to our investors for seeing the potential in our innovation. We have several other industries in our sights that can all replace negative impact products and materials, including pharmaceutical, technochemical, textile, and nutraceutical industries,” Selkälä continues.

Innomost’s current product portfolio consists of birch charcoal powder, birch bark powder, betulin, suberin and azelaic acid. These ingredients are perfect for innovation in all cosmetic product categories including skincare, haircare, body care, decorative cosmetics, and oral care. Azelaic acid, for example, is an effective solution for acne, which has exploded as a skin problem with the daily usage of face masks. Birch bark powder provides deep cleansing for skin and hair, replacing extremely problematic microplastics.

“Innomost is developing a business idea, in which birch bark, a side-stream of Metsä Group’s operations, is valorized to high-value products for the cosmetics and personal care industry. In other words, this is exactly the kind of development that Metsä Spring would like to catalyze. We are very much looking forward to helping Innomost reach its milestones and goals,” says Erik Kolehmainen, VP of Corporate Venturing at Metsä Spring Ltd.

Innomost’s birch bark products do not exclude any potential user groups due to their anti-allergenic properties as they don’t contain birch proteins, and they are 100% vegan. Unlike their competitors, Innomost’s products are purely natural, they don’t need coloring agents, and they can be produced on a larger scale, meeting their global clients’ needs.

“We have launched a couple of products in Lumene’s cleansing line with two different Innomost ingredients – Finnish birch bark powder to replace microplastics in exfoliating products and Finnish birch charcoal powder for the cleansing of oily skin. Our cooperation continues and we are looking for new ideas and solutions, especially for skincare,” saysTiina Isohanni, VP R&D and Sustainability at Lumene, one of Innomost’s clients.

“It is not only a question of ingredients. Lumene can also obtain expertise and experience from Innomost’s knowledge of wood chemistry and the wood industry. When combined with Lumene’s knowhow of formulating cosmetic products and evaluating product safety and efficacy, the cooperation becomes very valuable for both parties,” she concludes.

Innovestor Partner Myron Seto adds, “The market potential, particularly in cosmetics, is very sizable, and Innomost has developed a new industrial technology that can disrupt the global market supply. We look forward to tracking Innomost’s growth as they scale up production with its new pilot plant, displacing non-eco-friendly products with the use of natural betulin.”

Key takeaways

  • By using birch bark side streams, Innomost can utilize naturally occurring raw materials that would normally be used for energy production or other lower value purposes into high-quality ingredients. Their raw material originates from Nordic forests, not from lands that could be used for food or feed.
  • Unlike their competitors, Innomost’s products are purely natural, they don’t need coloring agents, and they can be produced on a larger scale, meeting their global clients’ needs. Innomost’s birch bark products do not exclude any potential user groups due to their anti-allergenic properties as they don’t contain birch proteins, and they are 100% vegan.
  • Innomost’s current product portfolio consists of birch charcoal powder, birch bark powder, betulin, suberin and azelaic acid. These ingredients are perfect for innovation in all cosmetic product categories including skincare, haircare, body care, decorative cosmetics, and oral care.

To find out more about using Innomost ingredients in your formulations, contact the company here.

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