[ SUMMER SCROLL] “Technology-enabled infra”: understanding the true scale-up challenges of circular economy
As part of our summer content series, we revisit an interview with Emmanuel Ladent (ex-CEO of Carbios) and Samir Karoum (Founder of Bombelli Ventures, former Strategy Director at Technip), originally published in French in 100 Transitions magazine.
In this sharp and unfiltered conversation, they unpack the structural and cultural gaps that often derail the industrialization of green technologie, from the illusion of “tech maturity” to the complex choreography of feedstock, offtake, and infrastructure investors. A deep dive into what it really takes to bridge engineering, finance and long-term impact.
Read the full article in English below :
Emmanuel Ladent, Samir Karoum (Bombellii Ventures): “Technology is not a business model in and of itself”
The circular economy and greentech are currently in the spotlight, but scaling to an industrial level is complex. Emmanuel Ladent, former CEO of Carbios, and Samir Karoum, founder of Bombellii Ventures and former chief strategy & sustainability officer at Technip, take a look at the obstacles to viability in the circular economy.
100 Transitions: What are the main differences in the business models of traditional industries and green-tech companies?
Emmanuel Ladent: In my opinion, the number one difference is that, in a traditional industry such as petrochemicals, licenses are granted to technology that has proven its worth and is already in use in factories around the world. It’s about licensing proven technology that has been on the market for decades.
With greentech, on the other hand, we are dealing with technology that, generally speaking, is not yet fully mature. It may have featured in an industrial demonstrator but is rarely integrated into a first factory. And I’m not just talking about a site where construction has just started, but a factory that is running and has demonstrated its ability to deliver a given level of productivity. It’s a matter of timing! Licensing technology under development is complicated, but it can be an intriguing option, provided there is a real appetite for the product.
Generally, greentech consume a lot of capital expenditure (CAPEX). It is possible to finance such investments via infrastructure funds or development capital, or to finance through licensing, with the risks associated with it if the industrial demonstration is not fully completed.
Samir Karoum: First and foremost, we need to go back and look at how a business works, and the value chain that it already has in place. The challenge of circularity is to develop a new value chain that gradually replaces an existing one. In general, you need to start by developing technology that solves a well-defined problem. It’s here that things get tricky, though, because in and of itself, technology is not a business model!
In the context of circularity, it’s often about scaling a new business model, which I call ‘technology-enabled infra business’. This term refers to a business which creates infrastructure that uses waste as feedstock to produce what is needed.
What comes out of this new factory is not the equipment developed by the new technology, however. The technologist enables the creation of production equipment and processes that allow waste to be transformed into an end product that replaces an existing product. In this context, the real prototype is the first factory to produce on the right scale and at the right price. Confusion often arises because the vocabulary of the technology world applies levels of technological maturity that are at odds with those used by infrastructure players. And it is this transition between the two worlds that’s difficult to reconcile and is the main challenge facing new businesses trying to get off the ground.
So, there’s a real disconnect here?
S.K.: Breaking it down, there are several levels of misunderstanding. The first is that the risk profiles of the technology world and the infrastructure world are mutually exclusive. Investors who are willing to take technological risks are not willing to take infrastructure risks. On the other hand, infrastructure investors are capable of providing large liquidity, taking seven-year risks, but they want a proven technology. So, when you come in with a new technology in a business that is technology enabled infra, of course you have to start by developing it, before bringing in an infra-skill.
But you also need to define – upstream – a somewhat hybrid path between these two worlds, and this is a particularly complicated industrialization path, one that, if not handled properly, can very quickly lead to disaster. This is particularly true when we apply models that are specific to non-infrastructure technology: going fast (say with software) and building a factory without having secured its feedstock and offtake is a recipe for disaster. And the examples of Northvolt and Ynsect are an excellent illustration of this [Editor’s note: in bankruptcy and looking for a buyer respectively]. It’s impossible to apply the conventions of the tech sector throughout the life of a company! The approach has to evolve regularly.
E.L.: I would add that technological maturity takes time; we are talking about long-term cycles – that’s just the way it is. There is often a mismatch with traditional tech investors who are not accustomed to long cycles.
You also need to be sure there is a market! Alongside the development of the technology, you need to prove that a market for it exists, that the product meets clients’ requirements and standards, without neglecting regulatory aspects.
In the end, patience is key. I have never seen a greentech get established in two years. The fastest I’ve seen it happen was around six years, from the conception of an idea in a laboratory, to industrial-scale deployment with a market in front of it. That’s the challenge of this green revolution.
What are the milestones on the way to maturity for a greentech?
S.K.: Creating a prototype and testing it with users can be done at a relatively low cost and level of risk. However, building the first factory is the moment of truth. This facility will validate the technology at scale, the economic viability of the factory and, ultimately, the market demand for the product recycled. Since customers buy the product at a fixed price, the construction of the factory and the offtake are interdependent variables. And this phase is extremely difficult to manage. You need to bring together a wide range of skills to successfully orchestrate scaling.
E.L.: With unsuccessful projects, it appears it’s mostly the scaling up stage where things fall apart. Often, demand is overestimated, as seen with Northvolt. Successfully completing a greentech project is about scaling the technology, entering the market and taking market share. Greentech products often come with a premium price-tag, and that is hard to bring down without massive scaling.
S.K.: To build on what Emmanuel has said, sometimes you have to be willing to target a smaller market, but one that can absorb higher price-elasticity. The choice of the priority market sub-segment is critical, and the tech world’s tendency to target the broadest market possible is not necessarily the right approach.
E.L.: I experienced this myself with the PET packaging industry. Major players like Coca-Cola are certainly receptive to innovation but are also very price-sensitive. On the other hand, in the world of cosmetics or luxury, packaging price is secondary and the added value it brings is much more important. In the textile sector, typically very price-sensitive, some luxury brands are very committed to circularity to boost their brand image and pay less attention to price. The cost of raw materials in a Patagonia tee-shirt, for example, is a very small part of the product’s marketing value. And without going so far as to say that we should only target niches, targeting is extremely important, and we mustn’t succumb to the obsession with high volumes.
What other risks are to be considered?
S.K.: Building the factory itself! Even if your technology is solid, building a factory requires engineering skills often very different from those required to develop technology. Even if the company’s founder has a competitive and differentiated technology, they generally won’t know how to build a factory. And if they underestimate the importance of this, they will not surround themselves with suitably skilled individuals. If they think they can go it alone and subcontract, they have probably already sealed their company’s fate. On the other hand, if they are humble, they can choose to bring in the right partners and shareholders to obtain this know-how. You need to acquire the right skills gradually, neither too early nor too late, to avoid the premature death of your business.
E.L.: The factors to success are multiple: you need a good technologist, someone for the factory, a skilled salesperson and solid financiers. The right ingredients at the right time… without losing sight of the regulatory aspect: some forget that permits can take years to be granted. Some have crashed because of this oversight.
Does this diversity of skills apply to financiers as well?
S.K.: Yes, investors change depending on a what stage of development a greentech project is at. The criteria that make a story credible to a tech investor are the opposite of those that need to be presented to an investor specializing in infrastructure. The initial investors, who are essential for developing the technology, are not the most suitable for industrializing at scale. Therefore, financing pools need to evolve depending on the project’s progress, taking into account the different expectations, timelines and ticket sizes.
The difficulty also lies in the fact that, as of yet, very few greentech have successfully made this shift. Unlike software startups, there is still no playbook showing technology enabled infra businesses how to avoid pitfalls. Without this framework, support is crucial.
Despite these difficulties, do greentech and circularity have a future?
E.L.: Absolutely! Our global waste production already exceeds our extraction capacities. So waste is going to become a raw material to be valued. We are on the cusp of technology emerging that will make waste, of whatever kind, a valuable resource. Only 9% of plastic is recycled, which is nothing, so we are just at the beginning of the adventure! Beyond pure ecology, the circular economy will take hold because it makes sense both ecologically and economically.
S.K.: The circular economy is the issue on which we are convinced we will never be proven wrong. It’s good for the Earth, reducing pressure on planetary limits, and it’s good for the economy, as it gives value to materials that were previously ignored. We are facing a problem that will become a solution. No industrial company with a genuine long-term strategy – I’m not talking about five years, but rather 10 or 20 years – can deny the importance of investing in the circular economy. However, regulators will have to do their job, because we can’t let the financialized economy, which thinks in the very short term, make all the decisions. We’re going to have to put in place appropriate and effective taxes and incentive mechanisms.
E.L.: I still have hope. Just look at China: circularity wasn’t even a topic there three years ago, but in January 2024, Xi Jinping decided that the country would embrace it, not just for exports but also domestically. This radical and strategic shift proves it’s not just Europe that cares about this issue. We are very well equipped from a regulatory standpoint, but the political will to fund all of this is still lacking.
