Mylea : a Better Leather

Mylea is an eco-friendly leather made from fungi mycelium grown in fibrous agricultural waste like sawdust, sugarcane, and palm oil. Mylea disrupt animal and petroleum based leather by producing a leather without harming any animal, zero nasty chemical treatment and fast growing process (from 3-4 years for growing a cow to 7 days growing a mushroom). Since 2015 Mycotech empower 4 mushroom farmer group to supply and manufacture the raw material. The production goals in 2021 is to produce 1 million sq ft to serve 0.005% of world leather market, meanwhile we can save 10.6 billion kg of CO2.equal and 30.000 cow as animal hides.

The fashion supply chain is one of the most polluting industries in the world. Leather industry is highly contributing to this environment damage. A rising global middle class means more consumption of bags – and more cows. Presently around 290m cows are killed every year from a global herd approaching 1bn. Projections tell us that in order to keep us in wallets, handbags and shoes, the industry needs to slaughter 430m cows annually by 2025 (Siegle, 2016). Between the tannery and the dye house, leather receives multiple applications of chemical preservatives, colorants, stiffeners, and modifiers to give it its desired finish. Apart from the fact that the vast majority of these additives are harmful to the environment and human health.

Vegan leather market skyrocketing as designers create animal-friendly fashion. This shifting trends makes synthetic leather market worth USD 45.41 billion by 2025 with CAGR of 7.4% (GVR, 2019). There is an increase in shoppers looking for items that have ethical and style credentials with terms such as “vegan leather”and “organic cotton”(Lyst 2018)

Nowdays, people try avoid using animal leather by using synthetic leather. Although, most of them are made from PU (Polyurethane) with cotton or polyester backed. a product made out of PU also won't biodegrade anytime soon, either, and neither can it be recycled. PU puts back into the environment that's the bigger issue here, such as the solvents that are used in producing polyurethane-based synthetic leather which are highly toxic. Vegan leather sits at the top of an industry riddled by inconsistency, irregularity and ambiguity.

There is a missing gap between animal and synthetic leather. Our innovation is fulfilling this demand by introducing bio-synthetic leather. This shifting trends attract many brands and designers to collaborate with us. Mylea already makes an agreement with 15 designers and brands and successfully develop 20 products of leather goods

Mylea developed from fungi technology inspired from Tempe, Indonesian traditional food.It is made by a natural culturing and controlled fermentation process that binds soybeans into a cake form. This special fungus is creating a filament network that mimicking a leather characteristic. 

Mylea addresses circular economy during the manufacturing process. Here is environment impact compared to leather production from single cow. Harvest time of mylea is rapid, only 7 days compared to cow that needs at least 2 years. Water consumption to grow mylea is only 45 L, lesser than growing cow (80,000L). We can save lot of CO2 emission. During the growing process only emitting 0.7kg CO2. Cow emits 355.500kg CO2. Currently mycotech can produce 12.000 sqft per annum, CO2 emission reduced up to 127,200,000 kg. With that amount of production, 360 of cow is no longer needed to collect their hides. 

Myela is head to head with animal leather. This is the advantage of using lab grown leather from Mylea compared to animal leather

1. Affordability Mylea cost USD 5 per sqm (40% cheaper) Animal Leather Cost USD 9 per sqm
2. Chromium content animal leather is using tanning process which caused water pollution. This is the result of waste water chromium content Mylea 0.05 ml/g (400x reduce Cr content) Leather 20 - 30 ml/g
3. Tensile Performance Mylea has similar strength with animal leather, but stronger than synthetic leather Mylea 17 Mpa Animal Leather 20 Mpa Synthetic Leather 2.2 Mpa
4. Mimicking calf leather texture The problem having synthetic leather is highly dependent on PU (Poly Urethane) backing on the surface to create leather looks. Mylea naturally creates the texture without using PU.

Mycotech develop technology from Mycelium to create vegan leather. Mylea is an eco-friendly leather made from mushroom mycelium grown in aricultural agricultural waste like sawdust, sugarcane, and palm oil. Mylea disrupts animal and petroleum-based leather by producing a leather without harming any animal, zero chemical treatment and having fast growing process (from 3-4 years growing a cow to 7 days growing a mushroom).

Mycotech since 2014 started this idea from scratch at lab scale. With rapid prototyping and lean approach, Mycotech develop this product by trial and error and having customer feedback in fast pace. This process makes the product ready to the market with limited resource and facility. Currently Mycotech own 3 patents.

Here is the patent details,
Mylea Patent - Patent Pending
Mushroom Leather Material, Method and Application of Animal Leather Replacement 
Number of e-Filing: WFP2018071228 

Number of Application : PID201810988
Date of Submission : 2018-12-26
Total Claim : 10
Total Page: 11

Biobo Patent - Patent Pending
Method of Organic Composite Material from Mushroom Bonded Agricultural Waste for Non-structural Element 
Number of Application : PP0201705559
Date of Submission : 2017-08-23
Total Claim : 9
Total Page: 21

Biobo Patent (new method) - Patent Pending
Method of Organic Composite Material from Mushroom Bonded Agricultural Waste for Non-structural and Structural Element
Number of e-Filing: WFP2018071230
Number of Application :PID201810990
Date of Submission : 2018-12-26
Total Claim : 7
Total Page: 13

Those patents will extended into 5 other countries in 2020.

Theory of Change

Environmental Impact
During the manufacturing process only emitting 0.7kg CO2. Cow emits 355.500kg CO2. Currently mycotech can produce 12.000 sqft per annum, CO2 emission reduced up to 127,200,000 kg. With that amount of production, 360 of cow is no longer needed to collect their hides. Mycotech production goals in 2020 is to produce 1 million sqft. It is equal to 30.000 cow needed to produce. We can serve 0.005% of world leather market share meanwhile we can save 10.6 billion kg of CO2.

Market Impact
Big brands such as LVMH, H&M, and Nike are investing lots of fund in environment and social impact. One of their goals towards sustainability is having a responsible material source. Their product is very dependent on animal leather product. The demand of animal leather is reached 1 billion sqft per annum. Mylea will be a significant alternative for leather goods manufacturer. 

Social Impact
There are two beneficiaries get an impact during manufacturing production
Mushroom farmers as a material manufacturer : 
All beneficiaries are located in West Java, Indonesia. Those beneficiaries are consist of 270 farmers, 64% of them are women. They are located less than 150 km from our workshop. This shorten distance helps us to reduce transportation cost and CO2 emission footprint. Mushroom farmers will be equipped with the skills to be part of the production process. They produced half baked raw material. We teach them to produce with our specification. This activity will give them the benefit to sustain economically. 

MARKET

Currently, Mycotech has customer pipeline from 1304 email inquiries. Total potential orders are 9400 sqm equal to 211.499,67 USD. Potential customer are coming from Indonesia (66%), Ireland (7%), USA (6.7%), India (4%) Malaysia (3.3%), Singapore (2%), Netherlands (1.3%), Germany (1.3%). In 2019 total revenue USD 35,839 and receivable income USD 117,000 in 2019. Company growth rate (CAGR) during the past 3 years reach 128%.

Mylea already makes an agreement with 15 designers and brands and successfully develop 20 products of leather goods. Some of that end-product already launch within Q2 2019

BENEFICIARY

Farmers as Agricultural Waste Suppliers 

These farmers will not have to spend energy to think about where to dispose their waste. Mycotech also working with biomass waste producer to tap their agri-waste. In 2018, we have signed LoI to utilize biomass waste from Palm Oil Plant in Palembang, South Sumatra Indonesia. They produce biomass waste 9000 kg per hour, this abundant waste are piling up and not fully utilize is a big concern for Palm Oil Plant, and government environment agency for environment impact. 

Mushroom farmers as material manufacturer : 
Mushroom farmers will be equipped with skills to be part of the production process. This way, the farmers will have extra income and could hire more employees. Currently, those beneficiaries are consist of 270 farmers, 64% of them are women. They are located less then 150 km from our workshop. This shorten distance are help us to reduce transportation cost and CO2 emission foot print. 

Mycotech put Mylea brand proposition as a better leather for planet. Our focus is produce this material and shifted many brands and designer toward eco conscious fashion by using our material. Vegan leather market skyrocketing as designers create animal-friendly fashion. This shifting trends makes synthetic leather market worth USD 45.41 billion by 2025 with CAGR of 7.4% (GVR, 2019). 51% of leather market is dominated by footwear industry. 2019 Projected revenue on Mylea, US$ 626,726.30 if it's realised it's gonna hold for 0.04% of the Indonesian footwear Market, and even just for Indonesia it is much more relevant number.

Environmental
In 2021 our target is delivering 1 million sqft of Mylea that will generate revenue up to USD 4 million per annum. The long term goal in 2050 is zero animal and petroleum leather.

Social
Gives profit and benefit to farmers. In Indonesia, we have a network with 53.000 mushroom farmers across the archipelago that is available to be our production pipeline.

Economy
This shifting trend makes synthetic leather market worth USD 45.41 billion by 2025 with CAGR of 7.4%. Mycotech aiming as the biggest market share of biosynthetic leather (10 % of Synthetic leather market). It will give us a valuation of USD 4-5 Billion.

SECURE PRODUCTION CAPACITY
Production capacity ini Q4 2018 is 100sqft/mo. We are scaling up in order to enter the commercialization stage in early 2019. In Q1 2019, production capacity will increase up to 1400 sqft/mo. in Q3 2019 our seed funding fund is allocated to upscale the production into 5000sqft/mo

SECURE MARKET DEMAND

Collaborating with small-medium brands and designers is our strategy to penetrate the market instead of collaborating with big brands. Small-medium brands don't have bureaucratic procurement and agile when doing prototyping. This rapid prototyping will give us scalability in making market availability.

1. Increasing production capacity up to 1500 sqft/mo 
output : scale up production up to 1500 sqft/mo, Collect agri waste 5000 kg per mo from farmers.
Currently Mylea already secured order from 11 small-medium local brands to supply 1500 sqft per month. Those brands come up with the idea of making end product such as shoes, wallet, watch, and bag. In order to fulfill this demand, increasing production capacity is needed. 

2. Zero Carbon analysis and Eco Labeling 
output : get zero carbon footprint analysis and get at least 1 eco label
Mycotech is trying to apply circular economy principle. All of the clients are requesting zero carbon analysis and eco labeling. This 3rd party acknowledgement or certification might help them to convince their customer about sustainability of the product.

3. Secure LoI from big brands 
output : get 1 LoI from big brands
Becoming market ready with big brands is important for the company in the long run. However, getting contract from big brands is require lots of works. Mycotech team should equipped with a holistic approach, looking at all aspects of the fashion value chain and integrating technology, sustainability, and design thinking to build new kinds of fashion businesses. Get an LoI from big brands will secure the demand and keep the partnership with the farmers sustain. 

Full Time : 26 Personel
Part Time : 6 Personel
Production Labour : 10 Personel

Adi Reza (CEO & Co-Founder)
Having background in International Business from Queensland University of Technology, and a fellow from Royal Academy of Engineering, UK. Adi is experienced in commercializing technology and research IP since 2014.

Arekha Bentang (CTO & Co-Founder)
Background in Microbiology and Biotechnology from Bandung Institute Technology. Ph.D Candidate in Waste Management University of Southampton, UK. 

Robbi Zidna Ilman (COO & Co-Founder)
Background in project management and architecture. Experienced to collaborate with ETH-Zurich to deliver a unprecedented project for exhibition in Seoul Architecture and Urban Design Week 2017. Since 2012, experienced to manage production with mushroom farmers.

Annisa Wibi (CFO & Co-Founder)
Background in Economy and Finance. Having executive course in Startup Ecosystem from Flinders University, Australia.

Ronaldiaz Hartantyo (CBD & Co-Founder)
Background in Architecture and sustainable design. A fellow from Jolkona Catalyst, Seattle USA. Ronaldiaz, managing business development using data analytics and design thinking and approach. 

Being used by customers is the best way to validate the market. We do co-creating with local brands and plan to make ready-to-wear product with mylea. This are collaboration we are making with small-medium brands.

1. Brodo (Shoes Brand) - will supply 500sqft per month in Q4 2019. Equal to 150 shoes
2. Pala Nusantara (Watch) - will supply 100sqft per month in 2019. Equal to 100 watch strap. We agree to have shares on every sold product.
3. Tegep Boots (Shoes Brand)- will supply 2000 sqft per month in Q4 2019. Equal to 600 shoes.

However, we are being approached by big brands to exploring Mylea as their new sustainable product collection. Those name is still disclosed until official announcement,

1. Watch Company* (Switzerland) - exploring mylea as leather replacement for watch strap and packaging kit. Potentially supply 0.06% of their demand that equal to 500,000 sqft per annum or generate USD 3 million.

*disclosed name

Mylea as Commodity 
Price of 1 sq ft mylea is USD 5 with COGS in 15.61%. It is more affordable than animal leather which cost about USD 15 sq ft. Brands or designers have a minimum purchase order of 1,000 sqft per month to get this discounted price. 

Mylea as Co-Branding
In order to fulfill small demand (less than 1,000 sqft/mo), Mycotech offer co-branding with brand and designer to develop mylea as an end-product. We are using co-creating scheme by split the profit sharing. Even though we only get minimum order of quantity, it is maintaining with high margin. The profit sharing between Mycotech and brands may vary from 30:50 to 50:50. 

Market Intermediary Model The market intermediary model of social enterprise provides services to its target population or "clients," small producers (individuals, firm or cooperatives), to help them access markets. Social enterprise services add value to client-made products, typically these services include: product development; production and marketing assistance; and credit. The market intermediary either purchases the client-made products outright or takes them on consignment, and then sells the products in high margin markets at a mark-up. 

Target Population : Farmers (Manufacturer) 

Social Enterprise : Mycotech (Product development) 

Market : brands and designer (End product & Retail)

Mycotech capital and operation expenditure financed from equity investment and grants. 

We would like to accelerate this adoption of technology and delivery of the end product to the customer. Securing production capacity is the main challenge we have to overcome. Get feedback from the expert about how to scaling up production in efficient by implement industry 4.0 framework.

Increasing production capacity up to 1500 sqft/mo 
output : scale up production up to 1500 sqft/mo, Collect agri waste 5000 kg per mo from farmers.
Currently Mylea already secured order from 11 small-medium local brands to supply 1500 sqft per month. Those brands come up with the idea of making end product such as shoes, wallet, watch, and bag. In order to fulfill this demand, increasing production capacity is needed. 

Co-create with global designer and brands
USA is well known as house of famous fashion designer and brands. Today they are looking many eco materials alternatives to achieved their sustainability goals and minimize their environment impact.
Mycotech is open for collaboration with designer, maker, brands to explore potential use of mycelium based material. This collaboration enable us to innovate a new product with human-centered design approach that gives more impact as usable product.

Getting Feedback for product improvement.
All collaboration will iterates mycotech product development. Designer, maker and brands are our customers, and being customer driven by having their feedback is the only way to improve product quality. 

We can save lot of CO2 emission. During the manufacturing process only emitting 0.7kg CO2. Cow emits 355.500kg CO2. Currently mycotech can produce 12.000 sqft per annum, CO2 emission reduced up to 127,200,000 kg. With that amount of production, 360 of cow is no longer needed to collect their hides.

Obejective

Zero Carbon analysis and Eco Labeling 
output : get zero carbon footprint analysis and get at least 1 eco label
Mycotech is trying to apply circular economy principle. All of the clients are requesting zero carbon analysis and eco labeling. This 3rd party acknowledgement or certification might help them to convince their customer about sustainability of the production

Activity

1. Data Collection (1): defining your organisational boundary (equity share or control approach). Please fill in the questionnaire attached and return it to us.
2. Data Collection (2): defining your operational boundary (business process) i.e. on-site & off-site facilities, processes, services, impacts
3. Data Collection (3): business context (nature of activities etc) and identify baseyear to set up your baseline emissions
4. Data analizing : analyzing data consumption and plan to do emission reduction 

Currently, our beneficiaries are consist of 270 farmers, 64% of them are women. One of the co-founder and CFO of Mycotech is female. From the team of 18, we have a male-female ratio of 50:50. The production team is dominated by women (64%). Mycotech encourages women and girls in science and technology. The textile officer who develops Mylea is lead by a female. committed to helping women pursue a career in business and technology. During the hiring process, it is important to have conversations about how they achieved their professional and personal goals while defining success in order to inspire others. We need more woman in science to create inclusive technology in the future.