SAN FRANCISCO - Fast-growing Silicon Valley start-up Serious Materials, a firm that makes green construction materials, is expecting tremendous growth next year, aided by an improving U.S. economy and federal stimulus that backs retrofitting of buildings to save energy.
Serious Materials, which makes energy-saving windows, drywall and other products, also aims to officially open its factory in the Chicago area in the next two months.
The Sunnyvale, California-based company, that has attracted the attention of President Barack Obama, could nearly double its revenue next year, Chief Executive Kevin Surace told Reuters.
We have substantial revenue and it's growing, Surace said, adding that the company could see revenue growth of between 40 percent and 100 percent in 2010. It's not out of the question to double next year.
Surace declined to reveal the firm's revenue but said Serious Materials has up to $400 million of manufacturing capacity and is expecting an outstanding 2010.
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We think we are going to see tremendous growth, he said. We are planning for it, we have staffed for it, we are ready for it.
Surace said he is receiving a lot of inquiries for the company's products.
Although the field is new, the green building materials sector is gaining attention and growing fast. Venture investments involved 45 deals worth about $350 million the past year, according to Cleantech Group LLC.
The use of green materials, such as better-insulating glass or low-energy light bulbs, can save more power and cut emission of carbon dioxide and other greenhouse gases than some alternative energy technologies like solar or wind, according to experts.
Currently about 40 percent of U.S. energy use goes toward the heating, cooling and general operation of buildings.
Serious Materials says its insulated windows and glass can reduce heating and cooling energy costs and emissions up to 40 percent.
The company, founded in 2002, has so far raised more than $120 million in venture capital, including the $60 million it closed last month. It employs 300 people, Surace said.
Serious Materials is mainly expecting to gain business from retrofitting for buildings, an area that the U.S. government plans to support with programs such as easy financing.
Serious Materials is seeing some improvement in the U.S. economy but new construction is still down, Surace said.
But retrofits continue to go up because of government incentives, he said. We see the retrofit business continuing to grow, especially around large energy savings.
Surace also said the company is looking at acquisitions as a strategy to grow.
We are not turning a profit at this time and we are not trying to, he said, adding that the company is focusing on expansion.
The company, which gained the attention earlier this year from the Obama administration when it reopened a closed manufacturing facility in the Chicago area and promised to hire laid off workers, is also getting ready to open that factory.
We are just about the level where we are ready to produce at a regular basis, Surace said. We will be really formally cranking in the next couple of months.
We have got a couple of dozen workers back, he said, adding that he expects that number to grow to around a 100 by next year.
(Reporting by Poornima Gupta; Editing Bernard Orr)