European Business: Your company’s name, Paptic, seems to suggest that it wants to solve the old “paper or plastic” question by finding a middle ground between the two. Why should consumers use your Paptic bags, if they want to – or must – avoid plastic? Couldn’t they just switch to paper?
Tuomas Mustonen: When we started developing the idea for Paptic five years ago, plastic bags were already being banned. Paper bags on the other hand had been around for decades and in practice hadn’t changed a bit in fifty years. With plastic bags being removed from the market in due time and paper bags having been a largely unaltered product for decades, we began to wonder if there wasn’t room for innovation in this market.
If paper bags could replace plastic entirely, they would have done so already. Tuomas MustonenCEO and Founder of Paptic
If paper bags could replace plastic entirely, they would have done so already: This clearly showed that paper alone could not fill the void that plastic bags would leave behind once rightly outlawed. We feel that our approach of trying to improve paper to better compete with plastics, especially in single-use or short-life-cycle applications, is superior to the approach of relying on bio-plastics, as others had attempted before.
European Business: How does your technology work?
Tuomas Mustonen: What makes paper strong is its tensile strength. The tensile strength of good-quality paper is ten times that of low-density polyethylene plastic film. But if you ask a random consumer which of the two – paper or plastic – is more reliable for carrying your goods home from the store, nine out of ten will give you the wrong answer and say it’s the plastic bag.
Paptic is fundamentally challenging the specification of how the performance of paper is defined. Behind it is our novel, disruptive foam-forming technology: Instead of using water as the carrier medium for wooden fibers as in the traditional approach, we use foam which consists of one third of water and two thirds of air as well as a small amount of surfactants. This makes the wood fibers bond more loosely and flexibly, and allows for the structure to become more textile-like, with higher elongation and lower bending stiffness. We are not that focused on coming up with better paper in the traditional sense by improving the paper’s tensile strength, but we try instead to optimize elongation and high-tear strength, which are a lot more important for a heavy carrier bag.
Paptic is fundamentally challenging the specification of how the performance of paper is defined. Tuomas MustonenCEO and Founder of Paptic
European Business: The European Commission intends to make a variety of disposable plastic items – from bags to straws – a thing of the past in the near future. Do you expect that this policy will give your company a major boost?
Tuomas Mustonen: Naturally, these legislative changes and political decisions in favor of renewable and recyclable alternatives to plastic are positive for us. But it is more important for Paptic to understand that these political interventions are a consequence of changes in the attitudes of consumers and totally in line with them. I was at a bookstore yesterday and in the line behind me stood a couple of young girls, probably ten or twelve years old, who mentioned how shocked they were about the fact that the store was still giving out plastic bags. That’s just one personal example to show how the public attitude towards single-use plastics is becoming more and more evident and rigid, which makes brands and retailers now take decisive action in order to fulfill the consumers’ clear demands – and not only in the areas already being closely regulated by the European Commission such as plastic bags and straws.
European Business: Often – and usually for the worse – environmental problems make huge headlines at first, only to see their impact subside just as quickly until they are again forgotten by society. Could this also happen to the current outrage at the environmental pollution caused by plastic?
Tuomas Mustonen: There are indeed some fluctuations regarding reports about plastic and its environmental impact as well as consumer outrage. I feel, however, that the problem with plastic is more massive and more ubiquitous than many other environmental problems. Last week I was at a conference where WWF Sweden was also in attendance, and they delivered a striking presentation about their report on plastic waste in the Mediterranean. It was harrowing: Although the Mediterranean is only one percent of global sea surface, it contains 7% of the plastic in all the oceans, which makes it one of the worst-contaminated seas in the world, close to home for half a billion European consumers.
Although the Mediterranean is only one percent of global sea surface, it contains 7% of the plastic in all the oceans. Tuomas MustonenCEO and Founder of Paptic
European Business: Paptic is currently focusing on carrier bags and replacing plastic in that sector. Are there other applications of your technology on the horizon?
Tuomas Mustonen: We started out with carrier bags, but we are already working in several other areas. Retail is going digital with huge leaps and the digital online retail business requires packaging materials both for its internal processes and for shipping goods to consumers. Today, boxes are one of the most popular applications of packaging materials, but plastic envelopes are also widely in use. In this field, however, the traditional characteristics of paper are not ideal, because the material of the envelope must not tear, which has led to the use of much thicker paper materials. What we are providing is a much more resource-efficient and 50% lighter envelope, compared to a traditional one.
Many consumer goods, especially non-food items like toys, mobile phones and other electronic devices often come in nice cardboard boxes, but when you open the box, you will usually see many small plastic pouches and bags which are used to protect the goods inside the box. We are aiming to replace these plastic films with paper, so that all the packaging materials the consumer receives can be recycled together in the most efficient recycling system there is: paper recycling, which is much more developed and readily available than plastic recycling. Globally, close to sixty percent of paper is being recycled, while only sixteen percent of plastic waste is.
European Business: The retail market is to a large extent controlled by big transnational companies. How is Paptic trying to reach out to players big and small and how do you attempt to convince them to use your product?
Tuomas Mustonen: That largely depends on the specific supply chain. Currently, we are not focusing on the biggest businesses, because as a young company, we cannot fulfill the needs of the largest players in the market yet. But we are aiming to cooperate with those consumer goods businesses that really strive to become more sustainable, for example the fashion industry, which is in the process of becoming heavily digitized. Most of the giants in the online fashion retail industry like Zalando and H&M ship their products with plastic envelopes. We are currently engaging with these brands to better understand the horizon in front of us, how to mold our business with them and we are already doing pilots with some e-commerce businesses, so that we can prove that we’re not only talking the talk, but walking the walk. Within this year, we will be conducting several pilot trials of using Paptic envelopes for e-commerce shipments in volumes up to hundreds of thousands of shipments.
A new material innovation like ours faces one particular question: How can we scale up? The main problem of digital companies is usually not one of scaling, but if we want to increase our volumes, we need to build a new factory. We are a start-up company which is building a new production line quite similar to paper machines in terms of their volume and scale, but with a totally novel technology and a project budget beyond fifty million Euros.
Like with all material innovations, our scale-up is capital-intensive and takes time. We strive to be as fast as possible, though: We started three years ago, we launched our first product about twelve months later while still a small start-up, and now after three years, we are fundraising to build the first factory to bring us beyond a revenue of 100 million EUR in a few years. But in order to have an impact, we need to have the volume.
A new material innovation like ours faces one particular question: How can we scale up? Tuomas MustonenCEO and Founder of Paptic
European Business: Do you believe that there is a place for plastic in the future at all – or is it your ambition to have Paptic or similar technologies replace plastic altogether?
Tuomas Mustonen: We are visionaries. We are on a bold path, trying to create a world where plastic becomes a smaller problem than it is today. But we are also realistic in the sense that plastic is a good material for many applications. It can fulfil many needs of businesses which other materials cannot. We are not aiming to replace all the plastic. But we are aiming to create a world where there are alternatives to plastic which combine renewable raw materials and recyclability, along with a solid market position.
Interview: Julian Miller, Pictures: Paptic