NAPLES, Fla.-Lehigh Technologies L.L.C., a startup company founded to make high-quality polymeric powders from 100-percent recycled content, has raised more than $8 million in its second round of private venture funding.
With this funding, Lehigh´s executives said they anticipate beginning limited production of their PolyDyne and PolyFlow fine and ultra-fine elastomeric powders at their Tucker, Ga., production facility by September. When finished, the 85,000-sq.ft. factory will have four cryogenic processing lines that will produce about 85 million pounds of powders annually.
Gulfshore Ventures, a Naples-based affiliate of Florida Gulfshore Capital, led the funding drive with the help of management, existing investors and other private investors, company officials said. Richard Molloy, managing partner of Gulfshore Ventures, will become a member of Lehigh´s board of directors. The company is moving its headquarters from New York to Naples, and all its executives will relocate there.
Lehigh´s founders include:
—Dennis J. Gormley, chairman, president and CEO, who is the former chairman, president and CEO of Federal-Mogul Corp.;
—Anthony Cialone, chief operating officer, the co-developer of Lehigh´s patented technology and proprietary manufacturing process; and
—James B. Gray, vice president of sales and marketing, who is a former managing director of Tenneco Automotive Europe and former president of Clevite Elastomers Inc.
Cialone said he has been developing and fine-tuning Lehigh´s technology and processes for the past five years, based on an important realization.
"So many of the attempts to develop businesses in the recycling market were based on the idea to do something with waste rubber, rather than looking at the customer end and asking what customers wanted," he said. "We tried to do some reverse engineering, building a system based on customers and their economics, not disposal fees."
Gormley heard about Cialone´s work, liked what he heard, and contacted him. "Tony and I got together and started talking," he said.
"Once I started investigating it, it didn´t take too long to get excited about it, and we started to put together a business."
That was in 2003. Gormley and Cialone spent the next 15 months visiting potential customers and gauging their interest, according to Cialone.
"There´s no sense starting a business unless there´s a market," he said. "And, if there is a market, do the economics make sense?"
PolyDyne and PolyFlow powders come in particle range from 80 mesh to 300 mesh, according to Lehigh.
While the company offers no estimates as to how much money potential customers can save by using the powders-that varies according to the application, Gormley said-they offer cost reduction opportunities compared with virgin materials, particularly when disposal cost avoidance and performance enhancement of products are factored in.
Consistency of particle size is the hallmark of Lehigh´s technology, ensuring both smooth processing and high-quality end-products, according to Cialone.
"When you specify particle size, it needs to be very precise, and we can guarantee it at least 99 percent of the time," he said.
PolyDyne and PolyFlow powders have applications in tires, molded rubber goods, paints, adhesives, coatings and modifiers for rigid plastics, the company claims. It generally is best, when specifying the powders for an application, to use rubber recycled from the same application, according to Gray.
"Powders from recycled tire rubber have some application in molded goods, but otherwise it´s best to match products," he said.
Lehigh now has about 15 customers in the tire and molded goods businesses who are very interested in its products, Gray said. The company is now moving aggressively to gain customers in the adhesive, coating and paint sectors, he added.
At some point, Lehigh will need another $5 million or so to complete the rollout of its Tucker facility, according to Gormley. "We´ll look at ways of obtaining that money when we decide to do it," he said. "Once we have determined that the product is as we have decided it should be, we will go out and raise the funds."