ACT’s Investment in 3E Nano

Pictured from left: Dr. Nazir Kherani, CSA and Co-founder, MP Baker representing SDTC, Steve Ferrero, CEO, and Dan Shea, Chairman and Co-founder

ACT’s Investment in 3E Nano

At ACT Venture Partners, we are always on the lookout for innovative technologies that can help address major global challenges. Hence, we are thrilled to announce our investment in 3E Nano, a Toronto-based cleantech startup that has created an innovative coating technology with the potential to transform the building decarbonization ecosystem. We participated in their Series Seed round of USD 4 million, led by Energy Foundry, alongside other notable investors such as MUUS Climate Partners, Creative Ventures, and New Climate Ventures. Additionally, the company secured CAD 5 million in non-dilutive funding from Sustainable Development Technology Canada (SDTC), a Canadian Government program dedicated to enabling the commercialization of new sustainable technologies.

Read on to learn more about 3E Nano and why we're investing.

New Standards, New Challenges

The building industry accounts for almost 40% of the global greenhouse gas emissions (GHG), in large part due to their dependence on fossil fuels that power energy-intensive HVAC (heating, ventilation and air conditioning) systems. A large portion of energy inefficiencies in buildings arises as a result of uncontrolled energy flow through windows, façades, and skylights, which leads to the overuse of heating and cooling systems to maintain occupant comfort. Currently, the global average R-value of building windows in the market is R2, where R-value is a measure of the window's thermal insulation capability, with higher R-values indicating higher thermal performance. A shift towards high-performance windows (above R8) is underway, driven by new regulations aimed at enhancing long-term energy efficiency.

The existing building stock will continue to emit harmful greenhouse gases unless improvements are made to the thermal performance of the building envelope. New structures must be constructed with high thermal performance properties to meet ever-stricter energy efficiency standards.

While various solutions such as expensive coating applications and electrically powered smart windows are on the market to increase the energy efficiency of windows, neither have been able to provide the desired properties in an affordable, sustainable, high light transmission, and high thermal performance platform. The perfect window ought to have maximal thermal impedance, reflect solar energy in the summer, admit optimal visible light, maintain aesthetic appeal, and incorporate dynamic functional properties.

Enter 3E Nano - 3E Nano manufactures solar and energy control coatings on polymers to transform the window industry with higher-performance products which are economically accessible. Their coatings can improve a window's R-value toward a double-digit value without increasing the price, resulting in increased energy performance and reduced heat transfer when applied to windows. As a result, indoor temperatures become more stable, leading to energy savings and decreased greenhouse gas emissions.

3E Nano – Low-cost, Thermally and Optically Smart, Sapphire-Like Transparent Coatings

Founded in 2015 as a spin-out from the University of Toronto, 3E Nano has been developing its technology in the Advanced Photonics-Photovoltaics and Devices Laboratory, with the dedicated support of its team of scientists. The company has also been collaborating closely with SDTC and its partners to complete the product development and accelerate the technology's introduction to the market.

3E Nano’s material platform is a low-cost, spectrally selective, low-emissivity (Low-E), sapphire-like nanocoating that can be applied to polymer and glass substrates in both roll-to-roll and rigid processes. Spectrally selective, Low-E coatings are thin, transparent layers of material that are applied to the surface of windows to reflect heat back into the building in the winter and reflect it back outside in the summer, reducing the amount of heat transfer through the windows. 3E Nano integrates spectrally selective, Low-E, and solar-control properties of its coatings with a minimum number of sputtering layers, enabling its customers to achieve higher thermal performance at a lower cost.

A unique offering: 3E Nano is exploiting the USD 32 billion global coated glass market, with its primary focus on integrated energy and solar control solutions. Existing coating solutions in the field, such as absorptive films and laminated glass, concentrate on films for glass rather than polymers. 3E Nano finds that integration of its polymer-based technology can compete successfully in this market since polymers have several advantages over glass, such as being lighter in weight, having superior thermal insulation, enhancing acoustic insulation, and being more flexible. The polymer-based platform’s ability to enhance aesthetics and reduce energy costs makes it ideal for large-scale applications such as facades, skylights, and greenhouses, putting 3E Nano ahead of its competition. Competition from smart window technologies like electrochromic and photochromic glass is limited due to their high cost and complexity, while 3E Nano's products are simpler to integrate. 3E Nano's products also maintain high light transmission while blocking heat, unlike current solutions that darken windows and therefore reduce light transmission.

A versatile business: 3E Nano’s business model is based on offering nano-thin coated polymer products to global polymer and window manufacturers, which in turn allows them to diversify their product offerings and explore new markets with stringent energy requirements. Specifically, window manufacturers can benefit from using 3E Nano's coated acrylic sheets in their insulated glass units (IGUs). An IGU is essentially a glass unit consisting of two glass panels separated by a spacer material and sealed together to prevent heat transfer. However, producing high R-value IGUs typically incurs higher costs. 3E Nano's innovative polymer pane technology eliminates this cost by vertically integrating into the window supply chain, reducing manufacturing costs and enabling faster time-to-market for window manufacturers.

A strong foundation of expertise: We recognize that 3E Nano's technology requires deep experience and a strong network to build credibility among diverse players of manufacturers and end users. That's why we are excited to work with Steve Ferrero, Dan Shea, Dr. Nazir Kherani, and Gordon Jekubik -experts in the fields of materials science and technology, who bring with them decades of combined experience. The team's dedication and comprehensive skillsets make them the perfect group to commercialize this innovative approach to change the window industry.

The ultimate goal: The company's plans include building its own advanced glazing unit and becoming the first vertically integrated sputter-coating company in Canada. 3E Nano also plans to partner with manufacturers in different regions, taking advantage of the absence of a Canadian flat glass manufacturer. This move will reduce costs for IGU and window manufacturers while increasing leads and creating new revenue streams for 3E Nano. By centralizing all steps under one roof, 3E Nano is positioning itself to become the most cost-effective and eco-friendly solution in its industry, creating an opportunity to make a significant impact in the fight against climate change. “Once fully commercialized, our goal is to reduce greenhouse gasses by one gigaton by 2050.” said Steve Ferrero, CEO of 3E Nano.

Next Steps for 3E Nano

The investment in 3E Nano aims to support the commercialization of its product, increase production capacity, and expand offerings in new markets. At ACT Venture Partners, we believe that investing in companies like 3E Nano is not only a smart business move, but it is also our responsibility to support innovative solutions that help to create a more sustainable future. We are excited to see the impact that 3E Nano's technology will have on the building sector and the world.