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New Zealand’s Startups

“Commit wholeheartedly as soon as you can”: Matt Kennedy-Good

The co-founders of innovative concrete startup Neocrete have extended their seed fundraising round to $5 million after being oversubscribed.


Fiona Rotherham

Neocrete's Zarina Bazoeva and Matt Kennedy-Good

Commit wholeheartedly to your venture as soon as you can, Neocrete co-founder Matt Kennedy-Good advises other startup founders, and talk to as many people as you can find.

“There’s that term ‘increase your surface area to luck’ and you do that by talking widely to people and being open to ideas and giving yourself the most opportunity to be lucky,” he says. “There are a lot of people out there in the community who are keen to help and especially if it’s an inspiring story.”

Neocrete’s story seems to have inspired investors: its $4 million seed round extended to $5 million after it was oversubscribed, and an as-yet unnamed lead investor from offshore is now sitting in the wings helping connect the company to global customers.  

Kennedy-Good says the founders have been “pleasantly surprised” at the high level of interest given they’d been advised the VC market had tightened globally. 

Kennedy-Good and his co-founder, Zarina Bazoeva, started the concrete company in 2019 seeking to revolutionise the global industry with a new type of concrete that’s both strong and reduces carbon emissions. 

Adding Neocrete’s Activator product to the concrete mix instead of conventional cement (the binding agent used in concrete) currently reduces the concrete’s carbon content by 50 percent. The company is on track to produce carbon neutral concrete by 2027. 

Cement is a big carbon emitter – accounting for around 8 percent of global carbon emissions; Callaghan Innovation says making a tonne of cement can produce as much as 800 kg of carbon emissions.

Within New Zealand, some four million cubic metres of concrete is poured annually, producing 1.4 million tonnes of greenhouse gas emissions. 

“We're not just trying to recreate 200-year-old cement technology; we want to create a better type of concrete, a new generation of concrete,” says Kennedy-Good.

Neocrete’s product has been proven in the lab and tested at scale with a number of customers. The money raised will go towards building its first plant in Waikato by the middle of next year, which will be capable of producing five tonnes an hour of its Activator product or 7500 tonnes a year. That, says Kennedy-Good, adds up to a lot of concrete.

In the meantime, the founders are setting up an interim facility that will be operational from early next year. “We want to be selling – at least pre-sales for pilot projects – to prove the product and get market confidence from the start of next year.”

The genesis 

Family-owned Auckland construction company LT McGuinness was a pre-seed investor in the startup, putting in $600,000 for a 30 percent stake, while the co-founders hold the rest of the company.

Kennedy-Good, who has been involved with other startups, met Russian-born Bazoeva through friends. He’s always had an interest in sustainable business and the building industry, and Bazoeva told him about her father’s innovation. 

Dr Oleg Bazoeva developed an additive called D5 Green in Russia over the last two decades, and it has been used to help build stronger and more resilient dams, bridges and high-rise buildings around the world. 

“We spoke with the industry here and decided that it was a great opportunity to build on her father’s innovation and grow a global business from New Zealand to decarbonise concrete,” says Kennedy-Good.

The concrete industry has already managed to slightly reduce cement emissions by adding fly ash (a waste product from coal-fired power stations and boilers) to the mix. But it almost doubles the time it takes for concrete to set, Bazoeva told investors at the Icehouse Investment Showcase, where she pitched for Neocrete’s seed round funding.

If the concrete takes longer to reach the required strength, it adds to building timeframes and means higher construction costs. 

Neocrete activates natural pozzolans – a pumice-like material that’s commonly found in volcanic areas, including in the North Island, and was used by the ancient Romans. 

Using nanotechnology, Neocrete has developed an alternative that allows much less conventional cement material to be used in concrete, and has faster drying times than other carbon-reducing efforts. 

A Callaghan Innovation R&D Project Grant allowed Neocrete to rigorously test various D5 Green mixtures at its Gracefield campus in Lower Hutt, which provided data on its performance for different concrete grades. 

Kennedy-Good says the original D5 Green product has now been replaced with one developed in New Zealand from local materials, called Activator, which it will take global. 

A second grant through Callaghan’s one-off booster voucher scheme during the pandemic helped create a calculator that can quantify the environmental impacts of each concrete mix design in order to encourage uptake within the industry. 

Getting early adopters

Homebuilder eHaus has already constructed several homes using foundations made with Neocrete’s Activator, which Higgins Concrete has also been trialling. Singapore-listed Pan-United, a global leader in low-carbon concrete technologies, has also been involved in pilots. 

Kennedy-Good says there has been early interest from developers and builders, particularly those seeking supply-chain security to replace imported concrete supplies, and Neocrete’s additive has been specified for the three new parliamentary buildings under construction in Wellington.

Another early adopter has been Northland precast concrete product specialist Duracrete, which makes a range of water tanks, septic sewage treatment systems and retaining walls.

Craig Little, who runs the third-generation business, says he and his wife were attracted to the chance to reduce carbon emissions and have successfully trialled the product this year on its rock retaining walls. 

Little says there was little risk in trialling a new product because anything Duracrete produces is tested rigorously to meet the required standards before it’s sold. More research and development will be needed on the mix before it can be added to the company’s other products, but Little is open to the idea. 

Reducing the industry’s emissions is not only the right thing to do, he says, it also makes business sense when the industry might in future be mandated to do so. 

Neocrete's product has been successfully trialled this year on  rock retaining walls. 

Kennedy-Good says the biggest risk for Neocrete is convincing the conservative industry to change. But the co-founders believe their product will have global impact because it fits neatly within the existing essential performance characteristics on which the construction industry is built. 

“Concrete is a foundation of the building industry and the way it sets, the time it takes to set, the way it’s poured, and the machinery that’s used – all of those things Neocrete fits within, even though it behaves slightly differently, and it outperforms concrete in terms of durability,” he says. “But we were very careful to fit within those existing building practices because otherwise we didn’t think it would be adopted.”

Building industry margins are tight so any new product has to be price competitive to replace existing cement, as well as match the workability and strength performance, not require massive capital investment and new infrastructure at concrete plants, and it needs to be low-carbon with a pathway to being carbon neutral. Ideally it should also be regenerative, and capable of being recycled and using recycled products, he says.

“Neocrete ticks all those boxes.”

Kennedy-Good says there is resistance from the incumbent cement industry, which makes good money off the way things are currently done. 

“It's a pretty easy and cheap product to work with. They're not racing to change.”

While New Zealand has a carbon reduction plan for the concrete industry, Kennedy-Good says industry globally will move “as fast as they need to. And that’s just the nature of business.” 

There is a lot of technology emerging around the world trying to solve the carbon problem concrete poses but he says Neocrete is hoping for a first-mover advantage, with licensing the technology globally along with building more of its own plants on the cards. 

“It’s a race to replace cement, so we're going to be moving fast.”


Fiona Rotherham

Fiona Rotherham has worked at numerous business publications as editor, co-editor and senior journalist. Her passion for startups was sparked while working at former entrepreneur magazine Unlimited of which she was also editor.

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