Let's start with a quick explanation of what exactly Solugen is. How do you think about it? What is the core product that you're trying to build?

Solugen is a modern renewable chemicals manufacturer. It's about rebuilding American supply chains, building chemical manufacturing in the US, and doing it in a way that's really at the cutting edge. There are a lot of different words you can use to describe what the cutting edge looks like. My background's chemical engineering. I like being very scientific about this type of stuff. You can put whatever label you want on it, but the story of manufacturing is the story of maximizing yields. Today, in the year 2025, there are all sorts of really cool tools in the toolbox so that our chemical plants have higher yields than anyone else's. That enables us to be structurally competitive when we go and build assets.

When I think about the surface area of your product, there's the chemical approach that you're taking, there's the bioreactor itself, and then there's the software. How do you describe that product suite? What are the critical components of Solugen's product?

I would consider none of those things to be the product. I would consider all of those things as what you need in order to enable Solugen to profitably sell a product. They all work together, integrated into one big system where, for each one of them, we're choosing the best tool for the job, and that ultimately enables us to make really incredible, really valuable chemical products at a really attractive price point for our customers.

Like we talked about at the beginning, chemicals go into basically every manufactured output, so you could spend your time in a lot of different places. If I remember correctly from the story of how you guys started, originally it was float spas. You were delivering chemicals in the back of your Subaru. So you've come a long way since then, working with the Department of Defense and things like that. How do you decide where to target your effort, whether by industry or by specific product subsets?

My favorite thing about being a chemical manufacturer is that literally the entire world is your customer. You can sell to anyone in any industry, really anywhere in the value chain, if you want to. That part is super exciting. I think it's really cool. My core expertise is this thing called techno-economics. What techno-economics is, is you can build a plant on a spreadsheet and never step foot in the lab. I always have this cheesy joke that math is free. There are very few things in this world that are free, but math is truly free. I build all the techno-economics for Solugen, for all the different processes.

Early in Solugen, it was about proving the technology and reducing cost structure. Cost structure is broadly a put option, and call options tend to be more valuable. Call options are uncapped. We're at a point now where we've really reduced our cost structure dramatically. We've proven out the technology. I spend most of my time on business development, focused on areas where we have the most commercial pull, where there's this urgency of, "Wow, we really need this capability. We really need this product. We need to solve this problem." And that's matched with where Solugen is technologically, in terms of the products and capabilities that we're able to deliver. When you build it on techno-economics, your sales price flows directly to the bottom line. So I used to be focused on cost structure. Now I'm mostly focused on ASP maxing.

Walk me through some of the variables that drive that demand. I could imagine some of it is massive influxes of demand for the end product, where things are flying off the shelf, so customers are coming to you to find alternatives. Some of it might be geopolitical, where different things are getting more difficult to get from different countries. What are some of the characteristics that drive the demand that drives up ASP?

Solugen is a small company, relatively unknown in this space, and most chemical supply chains have a multi-year bid cycle. You're catching us at a very interesting time because we're in this whole tariff world. A lot of the supply chains that we go after are established supply chains, and we're coming in as a new entrant. We've got a new product, a new solution, better performance, lower cost, all of those things. But at the end of the day, we need a customer that is actively engaged in re-examining their supply chains.

What tariffs do, regardless of whether or not we win the business, is that all of a sudden everyone's looking at their supply chains. So we're able to go out and start communicating with a bunch of customers that maybe we haven't talked to in a while. We talked to them when we were smaller, and they said, "Oh, we're not looking at our supply chain right now, we're happy." And all of a sudden everyone's like, "Solugen, can you make a tariff tolerance plan for us? What would that look like? What are the things that you can deliver, and how can you mitigate our risk here?" So it creates a lot of opportunities for us.

Let's take a step back to something you said at the beginning: one of the key drivers of why you're doing what you're doing is to bring some of chemical manufacturing back to the US. Give me a snapshot of how globalized chemical manufacturing has become. Is none of it in the US? Is some of it here? What is the state of the status quo that you guys could be replacing?

The state of the chemical industry in the US is that there's a broad, vertically integrated industrial base in the Gulf Coast. From oil refining, to the different intermediates, all the way to the end-use chemicals, it does exist in the US. All of those providers in the Gulf Coast, in the '90s and early 2000s, took those technologies and built their new plants in Asia. So the US still has them. They're aging. A lot of them are getting shut down. A lot of them are not competitive because their maintenance costs are so high. So even though the US technically has some of these capabilities, the question is really for how long, knowing that all the new plants are in Asia.

The tariffs create a really interesting situation around what makes the most sense to make in Asia and then do certain transformations in the US. What you end up with are these supply chains where it might be a single chemical, and you could look at a body like this: this is one pure chemical that changed hands five times on average from where it started. It could be 10 times if you go all the way back to the mine or the initial exploration and production company that went and got that oil. And this stuff's getting shipped all around the world. The US, in certain instances, is really just doing final transformations or final blending of a product.

When people are thinking about you as an alternative, what are the biggest selling points? Obviously, in the tariff regime we're experiencing right now, the local aspect is really critical. If I read correctly, you guys have something like 60%-plus (nearly 60%) gross margins. It's a pretty efficient model. I imagine that comes from the things you've built, from the chemical components to the bioreactor to the software. So maybe it's cost. But what are some of the drivers of why people are excited to work with your products?

Margin profile varies by the different industries that we serve. But we are a fully domestic supply chain, and I think that's what's really, really unique. We consume Minnesota corn, and we convert Minnesota corn into end-use chemicals that end-use operators can use. Typically you'd have five or 10 different people touching it along the way. We're pretty vertically integrated at a small scale. It's just one of the quirks of our technologies: we're able to build smaller, miniaturized manufacturing plants and do this type of thing.

Even if you think about the oil economy in the US, the US is probably an exporter of oil, because the oil refineries were meant to mostly handle imported, lower-cost crudes that are a bit more sour. So even though the US is a producer of oil, it's actually somewhat uncommon to take US oil and put it into US refineries. Whereas here, we're using US corn in our Houston-based manufacturing plant to then go to US customers. So it is actually a fully continental US supply chain.

With a lot of the hype and excitement about reshoring manufacturing to the US, I think people's immediate response is, "I don't really want to be building iPhones and shoes and stuff like that here." But there's a lot of sophisticated manufacturing that you can do in the US, especially with processes like yours that can be more efficient. For the foreseeable future, is your focus on continuing to deliver high-quality products for these specific processes that have really high demand? Or is there an opportunity for you to help with reindustrializing chemical manufacturing in the US, maybe retrofitting some of these aging facilities you're talking about? How do you think about playing into the broader capacity in the US for chemical manufacturing?

I think the two happen in tandem. As we service our customers, we're necessarily building manufacturing plants. If I go a bit structural and macro, in terms of the challenge and how Solugen is facing it, the US really doesn't have a labor pool to actually go and build out and operate a whole bunch of manufacturing plants. You eventually reach this point where we have a really cool manufacturing technology. Even though that's true, you don't want to compete against depreciated CapEx. What the US needs to do now is go build a whole bunch of new CapEx. That's really expensive. If everyone's building new CapEx, it's even more expensive. And do you have the labor that can actually go build all of this and operate it all?

So even today, Solugen uses a lot of used equipment from petrochemical plants. One example would be that we own the entire back end of the Juniper project in Lake Charles, Louisiana. The Juniper project was a Fischer-Tropsch plant that was trying to make fuels. It was gas-to-liquids. They were trying to do it into specialty chemicals, and then they went under, and we bought a whole back-end unit out of receivership that's petrochemical, essentially a refinery. We relocated that unit to Houston, and we're now putting enzymes in those systems. So yes, we have a cool new manufacturing technology. As much as possible, we want to leverage existing, already depreciated, in some cases shut-down US manufacturing and re-energize it with some more modern chemical conversion technologies.

Do you think that would extend to licensing your technology to other chemical manufacturers, so not just being the builder of the end product, but licensing your processes and systems?

Yeah, absolutely. It's a natural course for a lot of new chemical technologies and chemical companies when you look at past history. Someone will have a cool new technology, and you have to build a couple of plants to really prove it out. Once you've proven that this thing can work multiple times, then that door really opens. If you want to do international expansion, maybe there's a market where there's just a better partner that can do that commercial go-to-market motion, and you would rather license your technology in that market than go raise the capital to build out and operate a chemical plant over in that geography. It could absolutely open up for us.

It feels like there's a huge unlock that you guys can provide, both in terms of the products you're manufacturing yourself and your ability to help re-industrialize some of the chemical manufacturing in the US, taking over some of the older or even shut-down CapEx, as well as supporting some of the new buildouts. So it feels pretty optimistic. Whether it's because of the tariffs, the changing dynamics, or people wanting to de-risk their supply chains, whatever the drivers are, I'm curious for your take on what the chemical manufacturing industry is going to look like in the US over the next five or so years as some of these things play out.

Over the next five or so years, I would say we probably do see a lot of projects get announced, but then pulled back when CapEx increases. Right now, we're still figuring out the pros and cons of the tariffs. People are asking a lot of questions. It creates a bunch of opportunities for us. But also, when you go and build a chemical plant, sure, our whole supply chain is domestic, but that CapEx has got components from all over the world. It's an exceptionally complex object, building a chemical plant. So that is subject to tariffs.

How does that impact your ability to build capacity when you have to import all of these different materials?

I would say for five years, it's probably going to be like that. Over the next 10 to 20 years, I think it's going to end up being structural, that you have to onshore capacity and actually do it in the US.

What do you think are the biggest drivers of that? Obviously it's a complex, multifaceted thing. But if there was one core tailwind or subset of tailwinds driving that change, what are the most important variables to care about here?

Structurally, chemicals don't travel well. It's already well established that chemicals really don't travel well. For those chemicals that really don't travel well, just because it's so expensive to ship them, they're already domestic because they have to be. You could build out this ring of chemicals that are in that gray zone of, "Should they be domesticated? Should they not? Oh, we can do it."

Trade barriers are a structural norm now. They stayed mostly intact in the Biden administration. The numbers right now are a bit crazy. Where do they go in the future? I do think we're entering an era of these types of tariffs. It's not the sort of global free trade. And chemicals are really heavy. They take up a large volume on a ship. So that's a structural change that would essentially drive you to have to go and make this in a way that's shippable, and pattern match that way.

Okay, well, now a technology like Solugen enables you to build a miniature chemical plant. Do those two, added up, mean that it's now easier to go and build out plants in the US? I think those are tailwinds. The headwinds here are, obviously, you still have to go deploy all this new CapEx. New CapEx is hard to compete against depreciated CapEx, and you need the labor pool to go and do it all.