- 2 years ago
Dennis Calvert, President & CEO of BioLargo Inc. was recently a guest on Benzinga’s All-Access.
BioLargo is a cleantech and life sciences innovator and engineering services solution provider. Its core products address Per- and Polyfluorinated Substances (PFAS) contamination, achieve advanced water and wastewater treatment, control odor and Volatile Organic Compounds (VOCs), improve air quality and control infections and infectious diseases.
BioLargo is a cleantech and life sciences innovator and engineering services solution provider. Its core products address Per- and Polyfluorinated Substances (PFAS) contamination, achieve advanced water and wastewater treatment, control odor and Volatile Organic Compounds (VOCs), improve air quality and control infections and infectious diseases.
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NewsTranscript
00:00 [MUSIC PLAYING]
00:04 Dennis, it's great to have you with us today.
00:06 I haven't been the one to interview you in the past,
00:09 but welcome back to the show.
00:10 Abby, it's so good to be here and good to meet you.
00:12 Nice to meet you, too.
00:13 So I want to start off quick.
00:16 We already started the whole show with it.
00:18 Who are you rooting for with the Super Bowl this weekend?
00:20 Well, I have to go to the West Coast,
00:22 otherwise the producer will cut me off.
00:26 OK, that's fair.
00:27 That's fair.
00:27 I want to continue the interview, too.
00:30 So with that, I give a little bit of a description.
00:33 But besides my quick description,
00:35 can you give us a little bit of an overview
00:37 of the company for what you do for the viewers who
00:40 may not be familiar?
00:41 Yeah, it's a great story.
00:42 And it requires a little deeper dive to really understand it
00:45 all because there's so much going on.
00:47 And so messaging is very important.
00:48 So as we always say, we're an innovator solution provider.
00:51 We've been innovating for over a decade.
00:54 And we have these technology cornerstones
00:57 that we then bring smart people around
00:59 to do solutions for a whole bunch of different industries.
01:02 So we're kind of like a think tank, except we do the work.
01:06 And we don't just sell things.
01:08 We actually solve problems.
01:09 And anyway, we're really active in air, water, earth, energy.
01:14 And as an innovator, the idea is to find this cornerstone
01:18 where you can create a solution that
01:20 has a potential to be a disruptor in a market.
01:23 I mean, that's the thesis, right?
01:24 So everything we do has a chance to be a cutting edge solution
01:28 that replaces incumbents and does a solution that otherwise
01:32 is not available.
01:33 And so very mission driven, high impact,
01:36 focused on solutions that the world needs.
01:39 Pretty good.
01:40 Yeah, no, that was a great overview.
01:42 I want to say this for the end.
01:43 I was told to ask you about POOF.
01:45 We will jump into that later in the conversation.
01:48 Let's talk about this.
01:50 So thanks for the overview.
01:51 I've heard a lot about PFAS lately.
01:53 Right.
01:54 And I know it's a big process.
01:55 I've heard you say it, PFAS, yeah,
01:57 per and polyfloral alkyl substances.
01:59 Yeah.
02:00 These are the nonstick-- these are the chemistry.
02:03 This chemistry, it's a fluorine compound, strong carbon bond,
02:06 that's used in nonstick coatings.
02:09 So you think about nonstick coatings.
02:10 They're everywhere.
02:11 They're everywhere.
02:12 And they've been sold for over 50 years.
02:14 They did kind of revolutionize industry in the world.
02:17 They're in food.
02:18 They're in food packaging.
02:19 They're in water.
02:20 But it turns out, unfortunately, that they're very small.
02:24 They're called micropollutants.
02:26 In very small doses, they can do some harm.
02:28 But they bioaccumulate.
02:29 They last quote forever.
02:31 That's why they call them forever chemicals.
02:33 Forever.
02:34 They last forever.
02:35 Nature can't degrade them.
02:38 Well, guess what?
02:39 When we started this business, the inventor, Ken Cote,
02:42 our first inventor-- we have a whole crew now--
02:44 he says to me, whatever you do, don't mess with Mother Nature.
02:47 Don't mess with Mother Nature.
02:48 Well, PFAS kind of messes with Mother Nature.
02:51 Nature didn't intend to have things that last forever.
02:56 And so when you have these small pollutants,
02:59 flowing compounds that last forever, they can accumulate.
03:01 Turns out when they accumulate, they're not so good for you.
03:04 Linked to birth defects and cancer.
03:07 And so now this is the number one agenda item
03:08 for the White House.
03:09 It's extraordinarily high on the EPA list.
03:13 People call it now the contaminant of the century.
03:15 Not the decade, the centuries.
03:18 And there's sweeping reforms going on all over the world.
03:21 And we need mitigation.
03:22 And so basically, you've got to get it out of the environment
03:25 and manage it.
03:25 You collect it, destroy it, get it out of the stuff
03:28 that can harm people.
03:30 And a lot of people, it started out,
03:32 they say, oh, it's like a $500 million market.
03:35 Oh, it's $3 billion.
03:36 Oh, you know what it is now?
03:38 $13 trillion.
03:40 Oh my gosh.
03:40 $13 trillion market.
03:42 Yeah, it's going to go for decades.
03:44 This is not an easy fix.
03:46 It was sold for 50 years.
03:47 Might take 50 years to get it out of the environment.
03:50 So from our perspective, we focus
03:51 on how can we make an impact?
03:54 And so about 3 and 1/2 years of R&D,
03:55 we've got our first customer.
03:57 We're expert in the space.
03:58 And we're on a roll.
04:00 So there you go.
04:01 And you kind of mentioned this.
04:04 And so these sound like a major issue that
04:07 caused long-term health effects.
04:09 And I'm curious how BioLargo is jumping into the frame.
04:12 So technically, right?
04:13 So in the science community, the way they say that
04:15 is they're linked.
04:16 Causation is a funny word.
04:17 And it's super technical, right?
04:20 But the bottom line is it isn't good for you.
04:22 And litigation's out.
04:24 And regulatory's out, right?
04:25 And the noose of regulatory enforcement is tightening.
04:29 And every time it tightens, it makes our value proposition
04:32 go up.
04:33 I mean, that's the key, right?
04:34 So just last week, last Thursday or Friday,
04:36 the EPA put out another suggestion for a rule.
04:40 It'll go through a hearing process, right?
04:43 And in that, they tightened the way
04:45 that the waste stream is managed, the waste stream.
04:48 So when you take the PFAS out, what do you do with it?
04:51 Can you collect it?
04:52 Can you destroy it?
04:53 Where are you going to put it?
04:54 Who's going to handle it?
04:55 And what they've done is they're heading into this idea
04:58 that each one of those collection sites
05:00 is a hazardous waste product.
05:03 Well, HAZMAT requires extraordinary handling--
05:06 worker safety, work comp, collection, chronic exposure,
05:11 disposal in the environment.
05:12 And so basically, when you look at the pathway,
05:14 the way that the regulations are enforcing,
05:16 the cost of doing business in this space
05:18 is going extraordinarily high.
05:21 And so when we started over 3 and 1/2 years ago,
05:24 our engineers have been doing remediation, literally,
05:26 for 30 years, right?
05:27 This is their whole career.
05:29 And they said to me, look, whatever you do,
05:31 focus on to be the most excellent collector
05:34 you can be.
05:35 Because if you can super concentrate the contaminant,
05:38 then you can manage the disposal.
05:40 But if you can't super concentrate,
05:42 you have this massive waste stream.
05:43 So one of our lead competitive edges in the marketplace
05:47 is that we're the most excellent collector.
05:49 So where a carbon system or an ion exchange
05:51 might collect a truckload of carbon, 80,000 pounds,
05:56 we have two pounds--
05:58 80,000 versus two.
06:01 So if handling waste is expensive,
06:04 you'd rather dispose of two pounds
06:06 than you would 80,000 pounds.
06:08 So it's a massive value proposition.
06:10 So we've been doing trials.
06:11 We've done like 14 or so trials.
06:13 Just got our first build.
06:15 And so what will happen is we'll go from early adopter stage
06:18 now to mainstream.
06:19 It's going to take a little bit of work.
06:20 But from our perspective, it's now just a matter of time.
06:23 We've got the invention.
06:24 We've got the tools.
06:25 We've got the standing.
06:26 We're credible.
06:27 Our financial prospects are rising up so dramatically.
06:30 And so we're in it to win it on that one.
06:32 And ultimately, we'll partner this thing out
06:34 all over the world.
06:35 So we think we have a chance to be really a global footprint
06:38 for a solution for the world.
06:40 And this is fascinating stuff.
06:41 Obviously, you guys are making moves here.
06:43 And I caught wind of what you've started a new branch called
06:47 BEST to focus on all your water tech.
06:49 So what's--
06:50 [INAUDIBLE]
06:50 Solutions, yeah.
06:51 Well, the idea is we have so much going on,
06:53 we needed a spigot, a central point,
06:56 to manage the flow into the market.
06:58 We've got partners, channel partners.
06:59 We've got multiple solutions.
07:01 It's got engineering and equipment.
07:03 Yeah, and Tanya Chandler's taken over.
07:05 She's a pro, been in the business 25 years.
07:07 She knows everybody.
07:08 She knows how to navigate.
07:10 And so really, it's a step in the maturing of a business
07:13 ready to go out and conquer a market.
07:16 Pretty cool.
07:17 I mean, it sounds fascinating, all of this.
07:20 It seems like you're in it for the good of it.
07:22 And like--
07:23 No question.
07:24 Sorry, what did you say?
07:25 No question.
07:26 The whole premise of the business,
07:28 we always say we make life better.
07:30 Everybody always says, could you aim a little higher?
07:32 And really, what it does is it sets a tone for the business.
07:36 We always say, leave every customer better off
07:38 no matter what happens.
07:39 It's so simple.
07:40 It's so simple, and yet so hard to do.
07:43 And we've stayed the course for an extraordinary long time
07:46 to now come to the marketplace with credible people,
07:48 super smart, great innovation, a commitment to serve,
07:52 big vision of impact.
07:54 It's a combination that recruits people.
07:57 Everybody gets excited about the business.
07:59 So I just want to ask that, with the mission,
08:05 you have that mission.
08:07 But with all the talks of new laws coming in to limit these,
08:10 I bet things are getting busy for you all.
08:12 What's coming down the pipeline regarding
08:14 regulations that might boost business for best?
08:17 Well, so like this handling the waste stream, that's a big one.
08:21 And it takes a while for all these rules
08:23 to become fully enacted.
08:25 But what happens is the handwriting's on the wall.
08:27 So in the marketplace, this solution in particular
08:30 for PFAS, PFAS, forever chemicals,
08:34 we can touch every source of water,
08:35 including groundwater and soil.
08:37 So groundwater, industrial wastewater, drinking water,
08:43 firefighting foam-related substances,
08:45 like in the water and the cleanup.
08:47 It goes on and on and on.
08:48 And so when you think about that,
08:50 it leaves you with this thought of who don't you touch?
08:54 Almost everybody.
08:55 And anybody that uses water in any sort of system
08:57 or has been around military bases or oil and gas industry,
09:02 they all have PFAS.
09:05 And so the idea is that what we come to the market with
09:07 is a solution that's the most excellent collector.
09:09 And with an innovation, we can partner.
09:11 So people say, how do you change the world?
09:13 You do it with great partners.
09:15 So the idea is we become a tech support for a distribution
09:20 system.
09:21 People use our solution all over the world.
09:23 And we can license, sell, support.
09:26 And so what's going to happen is the new sort of regulatory
09:29 is continuing to enforce.
09:31 We're scaling up at the same time,
09:32 scaling up production and market presence.
09:35 And then we see adoption.
09:37 And all of a sudden, somebody says, hey, it really works.
09:40 We say, well, we know it works.
09:42 Now you know it works.
09:43 That's the trick, right?
09:44 We've got to convince people that they're confident.
09:46 And as that confidence happens, our numbers
09:48 just escalate so fast.
09:51 And we've demonstrated that with our success in POOF.
09:54 That's a great example.
09:56 I will get into that.
09:57 I do want to talk about your numbers that you mentioned.
09:59 So there's something else, these numbers.
10:02 2023, you saw two times the revenue of 2022.
10:05 Yeah, two years in a row, over 100% growth.
10:07 We think it's going to continue.
10:08 We believe so.
10:10 In the business model, we're often
10:12 reliant upon partners to do what they say they're going to do,
10:16 because we don't control the whole distribution system.
10:19 As we achieve critical mass and we have more distribution
10:22 points, we can better forecast.
10:25 We're growing into that sort of opportunity.
10:28 But we look at POOF.
10:29 And POOF has taken a clear position
10:32 that they'll grow 20% quarter over quarter.
10:35 Well, they had a huge impact on the company last year.
10:37 And it's going to do the same thing this year.
10:39 So they're on a tear.
10:40 That product's going hot.
10:42 And then on the engineering side, we look at it.
10:44 We say, we'd like to get about $10 million
10:46 worth of contracts under contract.
10:49 That doesn't always mean revenue, because you get prepaid.
10:52 You have work in progress and all this stuff.
10:54 But that's a nice impact.
10:56 So we came in the year just over $12 million,
10:58 higher than estimated, 100% over the last year plus.
11:03 Our numbers are going to surprise everybody when we finally
11:05 publish here in a few weeks.
11:08 Our periodic reporting will be due March 31.
11:11 So we've got a little bit of time.
11:12 So we've got auditors busy and closing the books and all that.
11:15 But the numbers are most excellent.
11:19 And what we're watching is the revenue's climbing,
11:21 but our overhead is not.
11:24 And so now, as these assets find their way to market,
11:28 we achieve a threshold of revenue in which there's
11:30 a lot of free cash flow.
11:31 Oh, man, free cash flow.
11:33 Are you kidding me?
11:34 I mean, that's awesome.
11:36 So it's taken a long time to get here.
11:38 It took a lot of money, a lot of patience.
11:40 And so now we're anxious to really create
11:41 value for our stockholders, see these things really
11:45 mushroom into the giants that they're intended to be.
11:49 I'm excited to see those numbers come out in a couple of weeks.
11:52 But going back, you mentioned POOF.
11:53 We haven't got into what it is.
11:55 Can you give us a little bit of a descriptor?
11:57 Well, so gosh, eight years ago, we
12:00 started an odor company, odor and VOC company.
12:02 So that's air quality, taking out odors.
12:05 And we have this incredible chemistry
12:07 that just is so wonderful because it's an oxidizer
12:10 and it's safe.
12:12 It's safe on people, pets, and the planet, as POOF would say.
12:15 And so with our industrial success,
12:18 a consumer came to us and said, hey,
12:20 we think you got a billion dollar product.
12:23 We said, yeah, we do too.
12:25 How do you do that, though?
12:26 How do you get to that?
12:27 It's hard to do.
12:28 So they came and said, let's do a deal.
12:30 So we said, OK, let's do a deal.
12:31 We'll go do the pet space.
12:33 And if you'll supply us.
12:34 I said, we'll supply you.
12:35 We'll make a little money.
12:36 We'll do a little royalty.
12:37 And we'll give you exclusive if you give me
12:39 a piece of the action, a piece of the equity of the brand.
12:42 OK, so about now, a year and a half, year and 3/4 ago,
12:45 it launched.
12:47 Well, this last year, they're in over 20,000 stores.
12:50 It's going to go to double.
12:52 It's going to double that this year.
12:54 We've got like-- I think they've got about 30 national retail
12:57 accounts now.
12:58 It's a huge direct-to-consumer product.
13:01 And if you haven't seen the infomercial,
13:04 it's all over the TV.
13:05 This is poof.
13:08 And it's safe for people, pets, and the planet.
13:10 And what it does, the chemistry is so astonishing
13:12 because it's a breakdown chemistry.
13:15 When it goes to an organic material,
13:17 it chemically breaks it down.
13:19 And it does so effectively that it
13:21 allows for the client complete odor elimination.
13:26 And so that was the gap in the market, right?
13:28 That was the gap.
13:29 And so of course, you've got to use it right.
13:31 So if anybody doesn't have success,
13:32 we always say, well, wait a minute.
13:33 Slow down because it has to work because the chemistry is
13:36 foolproof, OK?
13:38 So you have to deliver.
13:39 Anyway, but it is just blowing it out.
13:41 And it generates significant revenue growth and, of course,
13:45 free cash flow.
13:46 It's allowing us to support all of the expense for R&D
13:49 to launch these additional technologies.
13:52 I mean, it's creating this engine
13:53 that can fuel the company.
13:55 And of course, we expect on the exit,
13:58 we always say it wouldn't surprise us to see an exit
14:01 opportunity north of $100 million,
14:03 just so you get an order of magnitude for BioLargo.
14:06 And so we're heading in that direction.
14:08 Well, as far as Poof goes, I have two cats.
14:10 I will definitely be on the lookout for that.
14:13 You kind of sold me on it during the conversation.
14:16 Amazon, Chewy, Walmart, I mean, it's all over now.
14:20 It's now at Home Depot, Ace, True Value.
14:23 I mean, you can find it.
14:24 It's out there.
14:25 And of course, Amazon's easy.
14:26 So reach out to Poof, P-O-O-P-H, P-O-O-P-H.
14:30 And I will say, so going back to the topic at hand,
14:34 this is my last question for you, hot topic question.
14:37 So we're talking about PFAs.
14:39 It makes me wonder, what's next?
14:41 Are there any other chemicals that we
14:42 should be watching out for, something that could be--
14:45 Emerging contaminants, well, the EPA
14:46 publishes a list of what they call emerging contaminants.
14:49 And when they say emerging, what they're saying is the science
14:52 is finding them to be not so good.
14:54 It's an emerging risk.
14:57 And unfortunately, in the history of the United States,
15:00 those lists are--
15:02 the EPA is diligent.
15:03 They do a great job.
15:05 They're diligent about protecting the constituents,
15:08 the consumers.
15:10 But the way they measure is how many people get hurt.
15:13 And so it's really interesting, because industry
15:15 needs to take a position as a goal to produce safe things.
15:20 I mean, come on, make safe things.
15:21 Don't make toxic things.
15:23 And so in this case, PFAS went through 20 years of litigation.
15:27 And massive-- the largest tort reform
15:29 in the history of the United States, which is one case,
15:32 was settled for $10.2 billion.
15:35 $10.2 billion.
15:36 And they're just getting started.
15:38 So there's a huge regulatory and legal implication
15:40 of what was done.
15:42 And in many cases, the cases are showing
15:45 that the companies knew that they were producing
15:47 really harmful stuff.
15:48 OK, so is there any more?
15:50 Yeah, there's a bunch out there.
15:52 Go to the EPA list and do an internet search,
15:55 EPA emerging contaminant list.
15:57 I mean, there's 32 of them.
15:59 I mean, it's crazy.
16:00 So from our perspective, we have solutions
16:02 for a lot of those things.
16:04 As an innovator, one of the lessons we've learned--
16:07 and it's so easy to say and so hard to do--
16:09 is you've got to get where the wind's in your back.
16:11 Because if you've got a headwind, you just can't do it.
16:13 You never have enough money.
16:15 And so while there's a list of 32 emerging contaminants,
16:18 the tailwind's not in your back yet.
16:20 And until there's a push, until there's
16:23 something that's going to blow the wind so that people can
16:25 invest capital to bring solutions for those, which
16:29 is really driven by regulatory.
16:31 I mean, that's just the way it works.
16:33 And so for us, looking a little bit down the road,
16:36 being ready, waiting for the wind to get in your back,
16:39 and then pounce, go to market when
16:40 you can seize that opportunity to actually make an impact,
16:43 that's really the testimony of our journey.
16:45 I mean, we've been extraordinarily patient.
16:47 This PFAS, PFAS Solutions, now almost four years of work.
16:51 And we're just landing our first customers.
16:53 I mean, it's not for the faint of heart.
16:55 But we knew that this was going to be a global problem.
16:58 And we got in the center of it, and we prepared,
17:00 and now we're seeing the fruit of that investment.
17:03 Well, I think that's actually a really good point
17:05 to leave off on.
17:07 I just want to say, Dennis, thank you so much for your time.
17:10 And yeah, I think--
17:12 is there anything else that you maybe want to add
17:14 to the conversation?
17:14 We haven't gotten--
17:15 Well, just watch the company.
17:16 We've got a whole portfolio.
17:17 We've got a medical company.
17:19 We've got an energy company.
17:20 They're all coming to market, and they all
17:22 have a similar chance to go from obscurity
17:25 to significance in a blink.
17:28 And we think that's what will happen.
17:29 We think all the assets are going to find a home.
17:31 And the key, of course, is getting the best partners
17:33 you can and staying the course.
17:35 And our financial prospects as a company are rising up so fast.
17:39 And as we get critical mass, as they say,
17:44 a rising tide raises all ships.
17:46 Well, all those ships at BioLargo are raising up.
17:49 I mean, it's incredible.
17:50 And so the opportunities are so endless now
17:53 because we've created such a diverse portfolio that people
17:57 say you got multiple shots on goal.
17:59 And I say, yeah, we're going to knock them all in.
18:01 It's not maybe.
18:02 We're going to do it.
18:03 So pretty cool.
18:05 Dennis, again, thank you.
18:06 This seems like for the good of the people.
18:08 And I really appreciate talking to you.
18:11 Yeah, I hope to talk soon, too.
18:13 Yeah, go BioLargo.
18:14 Thanks.
18:15 Bye.
18:17 (upbeat music)
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