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About Us

 

Founding

In 2007, KiOR was founded by Khosla Ventures and a group of catalyst scientists who shared a vision of making renewable fuels from cellulosic biomass through a one-step catalytic process. A truly innovative process never before attempted, the catalytic conversion of biomass to a hydrocarbon fuel had potential global implications, since it relied on a simple, inexpensive conversion process and an abundant, low cost feedstock. Through this vision, biomass-derived fuel could be produced in seconds, versus the millions of years it takes to produce fossil fuels in nature.

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Khosla Ventures (KV) is one of the US’s most prolific biofuels venture capital firms with ambitious investments in both cellulosic ethanol producers as well as those targeting hydrocarbon based "drop-in fuel" replacements. KV’s involvement with what would become KiOR started with a call from an engineer from Holland to Vinod Khosla, KV’s founder and visionary advocate of renewable fuels.

The concept – a high-value hydrocarbon created from biomass rather than an alcohol-based fuel like ethanol, where Mr. Khosla had been focusing – immediately resonated with him, as he realized its potential for meeting the world's need for petroleum fuel alternatives. In contrast to the inventor’s interest in a licensing business model, KV envisioned that the KiOR process could lead to an oil exploration and production company without the exploration risk.

Implementing KV’s gene pool engineering methodology, a recruiting method focused on risk mitigation and fit, KV targeted the hiring of mission critical technologists to the company, ultimately leading to the hiring of Fred Cannon as KiOR’s President, and later CEO. With both location and leadership set, KV made a follow on $10 million investment in KiOR to fund the Company’s ambitious R&D program and pilot plant.

Proving the Concept

The pilot plant was an opportunity for KiOR’s proof of concept: that abundant cellulosic feedstock could be converted into renewable crude oil through a scalable, relatively inexpensive catalytic process. It became clear that the technology was far from ready. Though the initial technology approach failed, the new team set to work with single-minded focus and re-invented the technology. Remarkably, by the time the pilot came online, the team had innovated an entirely new process, one that yielded better product, economics and ease of scalability.

Encouraged by technical success at KiOR’s pilot scale, and in spite of the worst economic crisis since the Great Depression, KiOR and KV accelerated the time scale after just a few months of testing on the pilot plant and began work on a demonstration unit. On New Year's Day, 2010, the demonstration unit was installed, representing a 400 times scale up from the pilot. With the demonstration plant's capacity to process 10 dry tons of wood and produce up to 15 barrels of product per day, a commercial unit would be less than 50 times further scale up, which is considered a small scale-up in the vast operating history of FCC units.

Underlying the entire process has been KV’s steadfast focus on IP advancements and patents (to date, the company has 70 patents and over 2,000 pending IP claims across all aspects of its process).

Commercial Expansion

Having demonstrated the technical feasibility and scale of its process, it was time for KiOR to move on to commercial production. KiOR's "drop in" advantages intrigued potential customers, including a number of oil companies. Negotiations began in earnest, with potential customers eager to capitalize on KiOR's technological promise. For most venture-backed startups this would be a dream; for this high potential KV company, the momentum was lock in step with its aspirations.

To fund its first commercial production unit, two of Khosla Venture’s trusted financial partners, AIMCO & Artis, joined KV in a large equity round of financing. KV's advisors then arranged meetings with three Southeastern governors to discuss the facility's location. Within a weekend, KiOR had agreed to build in Mississippi, due to Governor Haley Barbour's enthusiasm for the company and the benefits it could offer the people of his state. Within a few months, the MS legislature approved a $75M interest-free loan for the plant in September of 2010. By the first quarter of 2011, construction was under way for an initial scale commercial production facility in Columbus, MS, which would process 500 BDT of feedstock a day and produce approximately 13 million gallons of renewable fuels per year.

KiOR began shipments of cellulosic fuels from the Columbus facility in early 2013. However, one plant is not enough to meet the company's ambitious goals. As construction was in progress at Columbus, the company was planning for larger, 1,500 BDT per day, standard commercial production facilities. It is at this scale that the company believes it will truly be able to match its ambitions, and compete not only with other biofuels producers, but with oil production offshore and from tar sands.

Encouraged by its progress to date, KiOR has developed a strategic plan to continue its growth, and ultimately to begin producing commercial volumes of cost competitive gasoline and diesel blendstocks without government subsidies and to deliver accelerated growth.