Ecoark sustainability startup raises $17.4 million in public offering for expansion

by Kim Souza ([email protected]) 488 views 

Rogers-based Ecoark is well-known in sustainability circles and hopes to continue growing a portfolio of businesses that focuses on everything from technologies that help ensure food freshness to reducing construction waste and pioneering products made from reclaimed plastic sold to retailers such as Wal-Mart.

The company recently raised $17.4 million in capital through an acquisition of publicly-traded Magnolia Solar in April. Ecoark absorbed Magnolia Solar into its portfolio and has since filed applications with the Securities and Exchange Commission to be uplifted from over-the-counter trading to the NASDAQ capital market.

Ecoark CEO and Chairman Randy May, who started several of the Ecoark businesses in 2004 after 15 years as an executive at Wal-Mart, said Ecoark set out to raise $10 million, but investor feedback and demand prompted the company to go bigger with their public offering.

“Successfully raising more than $17 million not only speaks to the opportunity that investors see for Ecoark and the technologies offered by our subsidiaries, but also the investor confidence in our leadership as the company moves toward listing on a national securities exchange,” May noted in late April.

Brad Hoagland, vice-president investor relations of Ecoark Holdings, told Talk Business & Politics that the S-1 filing process that registers the shares – under the ticker symbol EARK – for public sale has been completed and soon the restricted shares will be released and trading will move to NASDAQ. He said the S-1 registration process is deep and wide in scope and can take up to five months to complete.

When asked what the company planned to do with the $17.4 million it raised through its public offering, Hoagland said there are several technologies within their portfolio of businesses that need further investment.

“All of the funds raised are going back into the business for ongoing expansion, particularly in the Intelleflex business to start,” he said.

Hoagland said the company owns patented technology that can provide transparency on fresh produce from the day it was picked on the farm until the day it reaches grocery stores and is placed on display. For instance, a strawberry has between a 15 to 20 day shelf life. He said the way a strawberry is cut and how quickly it’s cooled and handled in transit may alter its fresh lifespan. Ecoark owns more than 60 patents on the technology that Intelleflex hopes to use to reduce fresh food waste. He said researchers found that inconsistencies in the picking, handling and transport creates about $160 billion annually in food waste.

“We are excited about the opportunities for Intelleflex in fresh foods and pharmaceuticals,” Hoagland said, noting there are some interesting possibilities in the works with industry for this technology.

He said the company’s closed-loop business Pioneer Products is already helping to keep plastic out of landfills. Pioneer creates consumer products using plastic reclaimed from retailer waste streams. The company’s reclaimed 45-gallon garbage can is sold in 3,600 Walmart stores and the company also works brokering other products and private label items that help to reduce waste.

The company recently began focusing on reducing waste in the construction industry with its Eco3d business that uses laser scanning and 3D modeling used in the construction, retail, real estate and healthcare industries.

Lastly, the Magnolia Solar acquisition aims to develop and produce low cost, high efficiency, thin film cell modules that use nano technologies. This business unit engages in R&D, product development and manufacturing strategies for the solar cell industry.