Espoo-based Paptic, a company specialising in wood fiber-based packaging materials, announced that it has raised €23M in a growth round of funding.
The investment came from new strategic partners and international equity investors including Germany’s VC fund European Circular Bioeconomy Fund (ECBF) and a global water and hygiene solutions company Ecolab.
Additionally, exiting investors like Japanese trade house Itochu Fibre Ltd also participated in the round.
Capital utilisation
Paptic says it will use the growth funding to support the development of its product portfolio, global availability of materials, and production partnerships. The money will also help accelerate the scaling up of their foam-based manufacturing technology.
Importantly, this investment aligns with Paptic’s aim to achieve carbon neutrality by 2030.
Tuomas Mustonen, CEO & co-founder of Paptic says, “We are very happy that our work and solutions to reduce the use of fossil-based materials in flexible packaging are recognized as sustainable and commercially viable alternatives for today and tomorrow.”
“With this funding, we will improve our market presence, sales network, and services to our customers. Additionally, this investment will enable us to further strengthen our sustainability performance and expertise, ensuring that we can exceed the requirements of our customers and tighten regulation.”
“This growth investment will accelerate and support our goal to reach €100M of revenue in 2026 and attain carbon neutrality target by 2030,” adds Mustonen.
€100M revenue in 2026
Paptic claims to have achieved remarkable annual revenue growth, doubling it for four consecutive years. They aim to reach €100M in revenue by 2026 while adhering to circular economy principles.
The company’s new investor, the European Circular Bioeconomy Fund, which focuses on the bioeconomy and circular economy, will provide potential support for Paptic’s sustainability goals, says Paptic.
Guillaume Gras, Investment Director at ECBF says, “The versatile applicability of recyclable Paptic materials provides an excellent basis to reduce the use of fossil materials in packaging. Our investment will provide Paptic with the resources to accelerate its international expansion, as well as to serve the growing demand for innovative packaging materials.”
How will Ecolab support Paptic?
According to Paptic, Ecolab, a leader in sustainability focusing on water, hygiene, and infection prevention solutions, has become a valuable addition to Paptic’s shareholders.
Both companies share a commitment to sustainability and can leverage their scientific expertise and industry connections for mutual business opportunities.
Ecolab’s “strong” presence in North America also supports Paptic’s expansion plans in that market, promising a mutually beneficial partnership for sustainability and market growth.
Co-founder Mustonen says, “Our rapid progress from a startup to a high-growth company, with Paptic materials in use by over 100 customers globally, has made us an appealing investment opportunity and we are delighted to welcome our new international investors to join us.”
“A cornerstone of our operation is to work in accordance with the principles of circular economy, to this end, we support our customers to replace plastics in various flexible packaging applications. Expanding our global shareholder base was one of the targets of this round, and I am very satisfied with the outcome,” adds Mustonen.
Growth potential
As per Paptic’s press release, the global flexible packaging market is worth over €200B annually, with 70 per cent of materials being plastics.
Paptic’s renewable and recyclable materials have the potential to replace plastic in nearly half of the end-use applications within this market, offering a significant opportunity for sustainability and reduced plastic usage in packaging.
Paptic is pursuing growth by reinforcing its presence in Europe, expanding rapidly in Asia, and exploring entry into new markets like North America. The company’s strategy responds to the ongoing growth in packaging demand driven by economic and population factors.
To reduce reliance on plastic, Paptic is committed to using resource-efficient materials that are recyclable and made from renewable sources. Importantly, these materials are designed to work seamlessly with existing recycling systems, offering compatibility with cardboard and packaging paper recycling streams. This approach supports sustainability efforts in the packaging industry.
Brief about Paptic Ltd
Founded in 2015, Paptic is a company focused on sustainable packaging solutions. It has developed Paptic, a fiber-based and recyclable material designed to replace plastics and other conventional packaging materials.
Paptic has been in industrial production since 2018, and the company, consisting of 35 professionals, now serves over 50 countries worldwide with their innovative materials.
In the past, the company was granted €2.5M by the European Innovation Council’s Accelerator programme. It has also secured a €10M non-dilutive capital loan from the Finnish Climate Fund. The funding was designated for the development and scaling up of Paptic’s foam-based manufacturing technology.