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Empowering Startups in the Wood Industry | Forestry Products Accelerator & Heartwood Biomass
12 Plays1 year ago
Jared Reynolds, the leader of the Forestry Accelerator (https://forestaccelerator.org/), and Matt King from Heartwood Biomass (https://www.heartwoodbiomass.com) join the Wood World podcast to discuss the challenges and opportunities in the forest industry. The Forestry Accelerator is a four-month program that supports startups in the forest industry, while Heartwood Biomass focuses on turning non-saw materials into value-added products. They discuss the importance of collaboration, the need for innovation in the industry, and the career opportunities available. They also highlight the unique features of Wood Straw, an erosion control product, and the potential of biochar in agriculture. Wood World is a podcast from Koval (https://kovaldigital.com/)
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Transcript
Introduction to Workforce Challenges in the Forest Industry
00:00:00
Speaker
All industries are facing workforce challenges, and I do think that is like some specific challenges in the forest industry. Today we're joined by Matt King from Heartwood Biomass and Jared Reynolds from the Forest Products Accelerator, which helps forest startups with tools to develop and grow. Forestry Accelerator is a four-month business accelerator that's open to
00:00:22
Speaker
any North American based startup. So we're a U.S. or Canadian company that is commercializing something new in the forest industry. Matt will be sharing his own experience going through the accelerator program and developing and going to market with his innovative new product called Woodstraw. We basically take all of the non-saw materials and everything you can't make a two by four out of from
00:00:46
Speaker
forest restoration or fire mitigation projects and turn that material into a number of value added products. And so we really squeeze every penny out of every log with the goal of facilitating more forest restoration.
Meet the Guests: Matt King and Jared Reynolds
00:01:00
Speaker
Welcome to Wood World, the podcast that brings you insights from industry leaders and innovators. Join us as we uncover strategies and inspiration to elevate your business as part of our mission to improve the lives of people in the wood industry globally.
00:01:14
Speaker
Today I'm your host Vadim Kovalev and I have my co-host Mario Angel from Koval as well as Jared and we have Matt. I'd like you guys to go ahead and introduce yourselves please Jared would you mind taking taking the lead?
00:01:29
Speaker
Yeah, my name is Jared Reynolds. I lead Due North in the Forestry Accelerator. So we are an entrepreneur hub center based in Northern Vermont, about 40 minutes south of the Canadian border. And we run a physical co-working space and a range of sort of startup and entrepreneur focused programs. One of those being our Forestry Accelerator. Very, very cool. Jared, thank you so much. Matt, would you please be able to introduce yourself as well?
00:01:59
Speaker
Yeah, my name's Matt King. I'm the VP of Sales and Innovation at Heartwood Biomass. And Heartwood is a wood products facility based out of Northeast Oregon in Malawa, Oregon. We basically take all of the non-saw materials, so everything you can't make a two by four out of from forest restoration or fire mitigation projects and turn that material into a number of value-added products, including Firewood,
00:02:27
Speaker
Posting polls like you see on farms or agricultural chalice, chips that go into the paper industry, making cardboard boxes for Amazon, and then a variety of grades of fiber. So we sell fiber into the particle board market. We sell fiber in the energy market as hog fuel.
Collaboration Story: Matt and Jared's Journey
00:02:46
Speaker
So we really squeeze every penny out of every log with the goal of facilitating more forest restoration.
00:02:54
Speaker
Thank you so much. Thank you so much, gentlemen. Well, very cool. I guess as an intro here, it'd be really great to hear how Jared, you, and Matt connected. And if I may share, Coble has done a project with Jared, and we've worked together some in the past, so that's how we know each other. But Jared and Matt, how did you guys meet?
00:03:16
Speaker
Yeah, so I run this forestry accelerator. So it's a four month program for startups in the forest industry that are commercializing some type of new product or service. And so we are on our second cohort of working with eight companies and Matt and Heartwood Biomass is one of the companies, one of the eight companies we have in our current cohort that is participating. Yeah, so we've had...
00:03:43
Speaker
I was forwarded a link to the Forest Accelerator Program from some colleagues of mine, actually from a couple different corners.
00:03:53
Speaker
that suggested I apply and I called Jared up and understanding that we're not exactly a startup. We've been operating for about 12 years now, but we are starting up a new facility down in Tlalmi County and we're also trying to commercialize a new product line. And so talked to Jared on the phone and he said that we'd still be a good fit for the program and that's proven to be the case. Yeah.
00:04:20
Speaker
Well, that's interesting. That's really cool that you were introduced there and got to know each other as well. Jared, could we start with you maybe? Could you provide an overview of what is the Forest Products Accelerator and maybe even just at the high level, what's your mission? Why is this program exist? Yeah, just tell us a little bit more about who you serve, what you do, what's the mission behind it all.
00:04:45
Speaker
Yeah. So the forestry accelerator is a four month business accelerator that's open to any North American based startups. So either US or Canadian company that is commercializing something new in the forest industry.
Forest Products Accelerator: Mission and Challenges
00:05:01
Speaker
And it's a hybrid program. So over the four months, all the companies come to Vermont for two what we call sprints, multi-day sprints. And then it also has a couple of virtual sprints. And then we do webinars or panels with industry leaders, investors, other entrepreneurs throughout the four month program. And we have
00:05:27
Speaker
A couple of focus areas are companies that are commercializing something new that uses low grade wood or develops markets for low grade wood byproducts, resins, dusts. Any company that's developing a new technology that could improve industry operations or sales or management or any advances to wood fuels or wood heat are really the types of companies that we are looking for.
00:05:54
Speaker
Right on. Jared, could I ask kind of like, why does this program need to exist? How did you guys find a need for this? What was kind of the inspiration behind creating this program and the goals that it serves?
00:06:07
Speaker
Yeah, so we are in our second year of this accelerator and it emerged over like this multi-year period. We used to run this forestry hackathon out of Two North. So every year we'd sort of put forward a new challenge and people would come to start sort of make believe businesses a little bit to try to solve those challenges. And out of that, we saw these really interesting ideas emerging in our quite rural area here in Northern Vermont.
00:06:35
Speaker
and saw this opportunity to support actual startups that are really looking to launch, grow, increase their sales. And so when we started this, we had two broad goals. One is we saw this need in the northern forest area, which is sort of like Vermont, New Hampshire, Maine, New York.
00:06:54
Speaker
to address the challenges that exist in the region. And those challenges are pretty similar to challenges that exist throughout North America, looking for markets for low-grade wood, looking at how the industry can leverage technology to address workforce challenges, changing environmental conditions. And then in addition to that,
00:07:15
Speaker
thought that there was this opportunity to support startups in the industry, that there are these other accelerators out there that are great, but they are not forest or wood products specific. And so that means like hard tech startups are a little bit different. They're looking for a different curriculum and a different approach.
00:07:33
Speaker
that is not the same as what a software company is looking for. And then in addition, we thought a lot of companies wanted those industry connections, guidance, feedback that they weren't getting at these sort of industry agnostic accelerators. So many of the companies we have have done another accelerator, but saw this opportunity to participate in an industry specific accelerator. Well, very, very neat.
00:07:59
Speaker
I guess, Jared, to stay with you here for a second, could you tell us a little bit more about your role on a day-to-day basis with, you said, due north, co-working. I know what a co-working space is. That sounds like a great fit for an accelerator. You've got a lot of people, a lot of action going on, and maybe your particular involvement with the accelerator as well. How do you balance those things? What are you in charge of? What do you do?
00:08:26
Speaker
Yeah, yeah, so I run June North and we have other people that also work here, which is this physical space. So a whole range of businesses, remote workers, other leaders throughout our region here in what we call the Northeast Kingdom, which is the three County area just to the South of Canada in bordering New Hampshire. And so we provide services to individuals in our region that need high speed internet, collaboration, connections,
00:08:57
Speaker
And then within Do North, we run this range of sort of startup and entrepreneur focused programs. And so some of those are focused on Vermont or on our region, working one on one with companies.
00:09:10
Speaker
and business brainstorming workshop we do.
Matt King's Path in the Wood Industry
00:09:13
Speaker
We have a kick-started EK, which is really focused on startups within our three-counting region. And the forestry accelerator is unique in that it has more of a national focus. So we do have some companies from Vermont. We've had four Vermont-based companies.
00:09:30
Speaker
probably seven or eight New England-based companies participate, but then also is open to companies like MAPS that are based on the West Coast, but don't have or are looking for this type of resource. And so my role is sort of to both run this co-working space as well as the range of programming that we offer. Thank you so much for sharing. And that's really exciting, you know,
00:09:57
Speaker
As our mission statement in our company is really to focus and live out the mission statement which is simply put to improve the lives of the people in the wood industry globally. It's exciting to have the both of you here and that's what you do live and breathe every single day. So I can't encourage you both enough.
00:10:18
Speaker
but to switch topics here for a second or just switch to Matt. Matt, could you share more about your position at your company, your VP of sales and innovation from what we saw on LinkedIn at Heartwood and kind of, can you share your journey in the wood products industry to got you personally to this position where you're at now?
00:10:38
Speaker
Absolutely. And maybe I'll start with the history a little bit and go from there. But the company that I now work for, Heartwood Biomass, was formerly Integrated Biomass Resources and really came out of a public-private partnership between a nonprofit called Allow Resources.
00:11:01
Speaker
the county in La County and then a couple of different small wood products businesses and a lot of resources itself originated in the kind of the collapse of the timber industry in the 90s. So, you know, we formerly had a county of 7,000 people formerly had three different full-scale sawmills working with over 100 employees each.
00:11:25
Speaker
all three of those shut down in the 90s and Wallach resources was meant to be a community development nonprofit really focused on natural resource stewardship through utilization. So basically like managing farms, forests, waterways in such a way that allows a sustainable natural resource economy to thrive rather than being more of an extractive economy.
00:11:53
Speaker
having it be focused more around a stewardship economy. And so a big piece of that effort from our resources day one was to find a way to facilitate forest management and bring more forest products businesses back into the county. And this was from the beginning supported by the county government itself as well.
00:12:16
Speaker
They tried a number of different things, including a large scale power plant. They could have really addressed the need of forest restoration on the forest. One big problem across the West is that there's just too much wood in the forest because of a century of fire suppression.
00:12:35
Speaker
and generally that wood tends to be small so there's you know more biomass than there should be overall and way more trees because it used to be less biomass in bigger trees so there are way fewer individual trees and so they tried to do a big power plant to sort of address the scale of the need on the forest but that didn't work because we have really cheap electricity around here and biomass energy is expensive
00:12:59
Speaker
and they tried to do a small sawmill and they tried to do an individual post-it poll mill and nothing really worked. You couldn't really match the relatively high cost of logging with relatively low value markets and make it pencil.
00:13:16
Speaker
And so Integrated Biomass Resources, it was founded by David and Jesse Schmidt. They had started just doing firewood. And in 2011 built an integrated facility on an old mill site that the county actually bought on behalf of the business. And then in partnership with a lot of resources built a facility that included an integrated processing line. So basically being able to bring unsorted loads in from the forest,
00:13:46
Speaker
really reduce the cost of logging on the landing out of the landscape and bring that material in really affordably and then sort it efficiently and effectively into these different product lines that we still produce to this day.
00:14:03
Speaker
And so my start was actually with a lot of resources when that happened. So in 2011, I started with a lot of resources. My background is actually in fish biology and was working on as leading up the community scale energy program. So we did small scale hydro, we did some forest biomass, energy stuff on smaller scale, we put in a small biomass heating plant for a
00:14:28
Speaker
for a school and then for our own building, the All Our Resources Stewardship Center, that's an old hospital that's been refurbished into a multi-use office space. And so kind of started to dip my toes in biomass and for 10 years worked for All Our Resources doing these small scale energy projects, but always partnering as a both,
00:14:52
Speaker
collaborator but also a direct owner of a part of integrated biomass resources, collaborated extensively trying to develop new product lines, potentially new markets for energy, for pulp chips or the biomass fuels that we could produce at the facility. And then in 2021,
00:15:15
Speaker
integrated biomass resources, got some new investment and brought some new owners in to reinvest in the facility that had been kind of a trial and error thing for 10 years and learned a lot of very valuable and sometimes very challenging lessons. And that's when I switched over from being the director of the Renewable Energy Program at Willard Resources to being the director of sales innovation over at Heartwood. And my role at Heartwood is really to
00:15:44
Speaker
to sell the products that we do make currently and find new products that can be manufactured from these forest restoration residuals and find markets for those products to actually sell them into. So it's really matching our production capacity, our potential additional capabilities through CapEx investments and matching all that with existing markets. And that's my role to this day.
00:16:14
Speaker
Matt, is that how you get involved with Forest Product Accelerator? Is it trying to launch or help, receive some help with new products?
Innovation Spotlight: Woodstraw Erosion Control
00:16:26
Speaker
That's right. I mean, you were saying that you received some information from friends in the industry about the program.
00:16:35
Speaker
if you can elaborate a little bit more about that. Yeah, that's right. As I mentioned, one of our core capacities is really being able to sort equipment really officially. There's this talk in the industry about
00:16:55
Speaker
the the wood products campus or wood products campuses or sort yards and we're basically the ideas you can take that low value material that you can't make a two by four hour ovens and sort it efficiently to different businesses and we've always had all the product lines under one roof.
00:17:11
Speaker
but we actually leased a piece of our facility to a logging contractor that started a sort of a temporary veneer business. They had purchased this restoration project from the Forest Service, had a bunch of material that they didn't have a market for and they wanted to have a go at making veneer. And so they were making veneer feedstock for the plywood market and giving us all the waste that we were basically just chipping and
00:17:39
Speaker
not really making any money off of it, but using it in our boiler. So it still was an asset to us. But we started to think about what we could do with it to squeeze some more value out of it and came across this product called Woodstraw. And Woodstraw is a next generation erosion control product that kind of looks and acts like agricultural straw when used as an erosion control mulch on the landscape. But it has a way higher permanence, so it lasts way longer, doesn't biodegrade near as fast.
00:18:09
Speaker
it's way more resilient to water flow and wind. So it's way more fixed on the landscape. It's easier to seed through it if you want to seed beneficial species. And then because it comes from the middle of a tree from veneer, it's necessarily weed free. So one thing that a lot of managers for erosion control projects, which are kind of target market, thanks to the accelerator program,
00:18:36
Speaker
that we've really defined as project managers for emergency stabilization in post-fire recovery. So there's also a little bit of a story there where we try and restore the forest before it burns, but if we can't, we also have products that can help restore the forest after it's burned.
00:18:55
Speaker
which is neat, but these project managers have a lot of issues where they go, they deal with the erosion problem with agricultural straw and then create a weed problem where they're introducing noxious weeds and then have to do years of treatment for these weeds. We bought some equipment to develop this product or to operationalize this product at our facility. But everything else we sell is really a commodity.
00:19:24
Speaker
The innovation is a skill, it's a muscle that you build out of business and everything else we've done is pretty straightforward. You can buy a firewood processing machine, you can buy a post and pole peeler and those markets are pretty well established. There's no difference really between our poles or our firewood and other firewood producers or other pole producers.
00:19:48
Speaker
much less pulp chips or something that's going into a paper mill that's buying 300,000 tons of chips a year. And so that practice of really developing a plan, a go-to-market plan for a new product, evaluating what the right markets are to tap into, and just creating a framework for operationalizing this product, but then actually taking it to market and growing that market
00:20:17
Speaker
just wasn't a practice we had done. So the Forest Accelerator was really ideal for us to
00:20:23
Speaker
to help build the skill set to do that, to do it specifically for wood straw, but also build the skill set to do that for other future product lines because we will always be looking for new opportunities to monetize low value wood. And we'll always have this core capacity being able to sort, you know, if someone wants two inch, eight foot cedar logs, we can take mixed loads of wood and sort out that material for
00:20:53
Speaker
for a different product line or for even a business that we lease some ground to. And so building that muscle and strengthening our ability to do innovation methodically and intentionally is really what we are getting and have gotten to date from the accelerator.
Market Strategies and Sales Success
00:21:15
Speaker
Nice. For people that are listening to this podcast, from your experience,
00:21:23
Speaker
What are the key elements in, let's say this is a four month program, right? What are the key elements on a monthly basis or I mean, from what you have seen, how is that the program is structured for somebody that another company or not another individual out there that is interested in participating in this program? Yeah, so the program really starts out with establishing your
00:21:51
Speaker
what they call the beachhead market, which is kind of exactly the small piece of the market that you're going to be selling your product into. And that was a great learning lesson for I think many people that were in the accelerator that, you know, take a product like ours, Woodstraw, you know, there's everything from backyard gardens to, you know, potentially like a Home Depot.
00:22:17
Speaker
to road construction companies, there are all these different potential use cases, but really dialing in exactly the best use case and therefore the ideal buyer and the beachhead market that comes from that buyer was really the first step and that was a real challenge and one of the most important pieces of this tool that's coming out of the accelerator.
00:22:45
Speaker
That Beachhead Market piece was also an introduction to the, there's basically a workbook that's a giant, complicated, unruly, and awesomely helpful Excel spreadsheet that allows you to go through all these steps from
00:23:05
Speaker
your beachhead market and establishing who your beachhead market is and helps you think through all the right questions to then, as you go on through the accelerator, helps you think through exactly what your revenue and pricing model is, exactly how to take your beachhead market and potentially grow into bigger markets, you know, to go and actually establish
00:23:31
Speaker
how you're going to make money selling near Beech Head Market to figure out what scales you need to be at from just a general pilot or even a lab scale to commercial scale and really just creates a roadmap as you go through the program to go from this sort of concept of Beech Head Market to be like, all right, this is what we need to do to go manufacture and sell this product to this market.
00:23:57
Speaker
And the thing that's really great about the accelerators, as you go through it, Jared and everyone that's helped develop this program has put together a huge list of industry experts, folks that are either from the venture capital side or from the manufacturing side or from the government funding side.
00:24:27
Speaker
that come and you don't exactly pitch to them. You talk to them very directly about how you're going through the workbook and why your business case makes sense, but even more importantly, why your product makes sense and why there is demand for your product and what is the need you're meeting.
00:24:49
Speaker
And you get feedback. You have the opportunity in these small group sessions to get feedback from these industry experts that is really beneficial in terms of helping, you know, helping ask questions that you haven't asked yourself or that haven't been asked through the worksheet. And so that process of refinement as the program goes on through each step and sort of
00:25:14
Speaker
cumulatively refining any step of the way, you can always be asked questions or think through stuff all the way back to the beginning, which at times is also challenging. But that's been immensely helpful in terms of the process of going through the accelerator. Yeah, I guess you already touched on some of those unique features. You had a lot of ideas of how, let's say specifically, Woodstock could be used
00:25:39
Speaker
But after you went through the accelerator, did you narrow down some of those key features or I guess the key applications? Could you share which ones those are?
00:25:56
Speaker
So we narrowed it down to a beachhead market of post-fire recovery project managers. So specifically talking to the people that are doing erosion control after wildfire season in order to mitigate the erosion effects that come along with wildfire. And so there's a big need for that sort of emergency erosion mitigation.
00:26:22
Speaker
including to protect resources, protecting these there, but also to help maintain stream water quality and quantity, to help minimize landslides, that kind of thing, to help minimize impact to critical infrastructure. A lot of times the Forest Service is trying to protect roads by doing erosion mitigation.
00:26:42
Speaker
And so there's really a major need and that was actually borne out over the duration of the program. We did sell a number of truckloads of Woodstraw to post-fire recovery managers over the last couple months because the
00:27:01
Speaker
The program really coincides with the end of the wildfire season, which is the beginning of the erosion mitigation season. And so we really dialed in to that market and it really did help us generate sales by focusing just on that and not spending the little bandwidth that
00:27:25
Speaker
that we have on chasing other markets, like a Home Depot retail market or some sort of road construction market or something like that. I have a question. Who came up with the idea, the concept Woodstra? Yeah, that's something that you
00:27:47
Speaker
That's a great question. We purchased the equipment from a company called Erosion Control Innovations and they purchased it from a company called Forest Concepts. Forest Concepts invented the product.
00:28:05
Speaker
or at least invented the manufacturing equipment and trademarked the product. There had been talk within the Forest Service research labs about using a wood strand mulch, different wood-based mulches that could outperform agricultural straw and
00:28:25
Speaker
be readily available in the forested West and potentially, you know, the Forest Service is always trying to think of products that can also facilitate utilization.
Manufacturing Process and Benefits of Woodstraw
00:28:33
Speaker
So they really want to find a product that can be made from forest restoration residuals, the leftover trees from those projects, and instead of burning in a slash pile, turn into a useful product that can then be reapplied to the landscape.
00:28:48
Speaker
Kind of the concept really came out of Forest Service Research Labs, and then Forest Concepts turned into a viable product and designed all the manufacturing equipment. But they're truly a manufacturing innovation lab. So they like to develop new equipment, design and develop new equipment, figure out how to operate it, and then sell it to a company that actually will manufacture that product.
00:29:14
Speaker
And so that's what they did here and were the current beneficiary of their work. I'm reading just right from your website, Matt. It says, Wood Straw is a patented engineered wood strand mulch with highly effective erosion control characteristics, useful for post wildfire restoration, road maintenance, mine reclamation, construction, and any other
00:29:42
Speaker
disturbed soil projects. Great summary of it. I'm curious, my background is in engineering and mechanical stuff as well. I'm just curious if you could share some more about how to actually make this stuff. Why is this different than the mulch you could just go buy from a landscaping place? Yeah. So a funny side note, that website, you're looking at the Woodstraw.com website. It's heartwoodbiomass.com.
00:30:13
Speaker
Oh, it is on Heartland. Somebody put that on a demon. Okay, that's interesting. Most people, kind of a funny deal, the forest concept still controls the woodsaw website. And so there's a lot of information on there that doesn't reflect what I've learned in the accelerator, but that's a side note.
00:30:35
Speaker
So to answer your question, you know the way that wood straw is made is it is you take sheets of veneer just like you put in a multi-layered sheet for plywood and glue together for plywood but instead of
00:30:52
Speaker
going together and making plywood, you run it through what is, it's kind of like a glorified paper shredder. So it makes strands that are from two inches to about seven inches. And it cuts strands that are like three sixteenths wide.
00:31:08
Speaker
You know, generally we use eighth inch ply and then between two and seven inches long. And so when you put it, when you drop it on, you know, on a slope or whatever, wherever you're trying to mitigate erosion, it creates this like three dimensional matrix. And so one, it prevents rain from getting to the, directly to the soil surface.
00:31:32
Speaker
And then it creates a bunch of kind of small interlocking dams so that water flows across the landscape. It slows up before it absorbs into the soil instead of just running down a slope.
00:31:46
Speaker
But then it also sort of locks together. So unlike straw that can blow around and get spread off a hill, it'll lock together. And so that makes it really resistant to wind. And then just the fact that wood itself is much more, wood is a much higher duration product in the landscape. So compared to,
00:32:11
Speaker
even a hydro mulch or something like that, that's going to go away after a couple of years. And certainly compared to agricultural straw, having this wood product on the landscape allows you to get four or five years of erosion mitigation from one application, which just isn't the case for even blankets, hydro mulch, like some of the other alternatives that
00:32:34
Speaker
generally aren't even practical for a forestry setting. It just lasts way longer than those other products. You know, you just kind of basically answered proactively the question I was going to ask, which is, what are some of the unique features and qualities of the product WoodStraw, as you just described? I guess the follow-up question to that, if there may be other unique key features or qualities that you would like to describe, but I'm also curious just
00:33:04
Speaker
How sick of an application do you have to put down for it to be effective?
00:33:08
Speaker
So generally it's less about, we talk about it not about thickness and more about coverage and you want about 70% of the soil to be covered from looking from above on a two-dimensional perspective. And that generally equates to about three inches of coverage, but it doesn't create a mat. So that's a really important aspect is that it's,
00:33:38
Speaker
Because it's this three dimensional structure, you're able to see through the product in years after application, you can still see through it if you wanted to put any sort of beneficial seeds down.
00:33:53
Speaker
And then because it's a mulch, just like any other mulch, you get better germination because the soil moisture is actually held better. So in dry land applications where you can't irrigate, you get better germination rates with any mulch. Man, that's super interesting, man. You guys hitting some really specific niche in the space here. I love it. Yeah.
00:34:23
Speaker
Trying to anyway, just getting started here. I wanted to ask you, so the patent and the application and all that, so that belongs now to your company? So we have a license agreement with Forest Concepts. Okay, so still the, but that's something that, yeah, okay, I got you.
00:34:47
Speaker
I was thinking about because this is the erosion, for example, and forest fires is an international problem. Yeah. Right. Well, this technology can be applicable anywhere in the world, really. Totally. And people make plywood just about everywhere in the world, too. So there's veneer available just about everywhere.
Industry Innovation and Community Impact
00:35:11
Speaker
Yeah, our license agreement basically covers the Western states. So Idaho, Montana, Nevada, Arizona, and then California, Oregon, Washington. There's no licensee outside of the United States, but there is a second licensee that's based out of Colorado, and they do Colorado, Utah, Wyoming, Texas, New Mexico.
00:35:44
Speaker
So there is opportunity for other businesses in this space. And like you were saying about it, there's certainly a need across the world. And so thinking about the world idea and being able to share ideas across the world, there's some knowledge that could be shared there. Absolutely.
00:36:12
Speaker
I guess maybe with that, I'd like to kind of bring it back to Jared, you and Matt, you guys together. But in what ways does participating in the FPA, the fourth products accelerator benefit both Heartwood Biomass as a company and the broader wood products industry more generally speaking? Yeah.
00:36:34
Speaker
I mean, I think I kind of come back to our these like core areas that we identified early on when we were envisioning this accelerator. I mean, we've been really like impressed with the types of companies that have come out even between our first year and our second year.
00:36:50
Speaker
I mean last year we had a lot of companies that were like developing new types of wood fuels, wood energy systems, versus this year we've transitioned for whatever reason to a lot more companies that are doing building materials and building products, which is really interesting. It shows like the whole range of innovation and
00:37:09
Speaker
startups that are emerging in the industry. And we've also, in both years, had some software companies that are finding new ways to assess forests, support operations of foresters and forest industry companies. So I think I'm excited and hoping to continue to grow this program as just the wide range of companies that we can potentially work with that are supporting the industry
00:37:39
Speaker
and have the potential to create jobs, create products. And then in our case, and I think in Matt's case, is to really benefit rural communities, which is also really interesting to us. I mean, a lot of these companies aren't merging in areas that don't traditionally have the same types of startups, so they are both
00:37:58
Speaker
you know, doing something really interesting in the industry and supporting and creating quality jobs in their communities, which are very often rural based, which I think is really exciting to us as similarly a quite rural region. Yeah. I hear you. Mm-hmm.
00:38:24
Speaker
Here's a question for you both. What advice would you give to other companies in the wood product space? Maybe similar to Matt, your story or Jared, other stories that you know of like, you know, companies that are in the wood product space who are considering joining an accelerator in general, but you know, the forest products accelerator more specifically.
00:38:49
Speaker
I think we have, yeah, go for it, Matt. Jared, you're on it. I mean, we have as an accelerator, both an interest in supporting, I mean, Matt is kind of unique in that he is like a bridge between these two groups.
00:39:05
Speaker
But supporting these emerging ideas, but also really trying to engage industry leaders in existing companies, which has been a process to build that up. I mean, from our first year to our second year, we have seen way more engagement from existing companies and more interest and always talking to these from large corporate partners to county foresters that are interested in
00:39:34
Speaker
technology and innovation that's emerging. So we're really interested in engaging both of those groups like these startups, merging companies that are looking for some type of support and also these more established companies that want to engage with innovation and they see a benefit. One is just to see like what's happening in the industry to keep up to date. Two is there are potential customers of many of the startups that are participating in the accelerator or their partners
00:40:03
Speaker
or they benefit from this technology in some way. And so we really have, yeah, this real interest in engaging like the whole industry. And then additionally, the forest industry is I think somewhat unique and nice in that there is this really investment in the industry that we just bring a lot of industry experts in that just want to see success. I mean, they see this benefit of developing new markets for low grade wood. And some of that might be a financial benefit to them, but also they just,
00:40:30
Speaker
uh you know this general incentive of seeing a thriving industry and strong communities and so really worked through this to engage like all of those that range of stakeholders. Absolutely. Gotcha. Mike you're in your perspective too. Yeah I mean and to follow up to um just on what Jeremy's saying like the the forest products industry is unique in that
00:41:00
Speaker
You know, there is some, you know, pretty heavy competition between kind of the big players, particularly on the lumber and plywood markets or lumber, plywood and paper markets.
00:41:14
Speaker
But everyone understands that a thriving forest products industry is a good thing. So the idea that high tides raise all ships. And there's a lot of help and guidance and assistance and collaboration that can be done if new businesses are coming into the marketplace and are humble enough to ask for that help. And the accelerator is an example of that.
00:41:44
Speaker
being able to go into a program and realize that you don't know what you think you know about your product or your markets and that we all can learn more.
00:41:55
Speaker
on our business and how to help develop these new products that sometimes are incredibly innovative and new and other times are even just kind of reinvigorations of existing product lines or existing markets. But being able to, being able and being willing to ask for help, to reach out to funders, to reach out to other business owners,
00:42:23
Speaker
You know, by and large, everyone wants this industry to grow and to succeed and understands that, you know, the rural communities that depend on these natural resources, all the businesses that depend on wood utilization, sort of all benefit from this work being done and from new businesses entering the space and people finding new ways to use wood that are awesome and super fun to see.
00:42:52
Speaker
I think that in terms of advice, I think I'd just say, you know, people are willing to lend a helping hand if people are willing to ask for it. Interesting. Is that how you envision the future of our industry, where there's a lot of collaboration, innovation, a big role for sustainability? It's not the future that you...
00:43:18
Speaker
Yeah, I think that's totally right. It kind of has to be the future because when you're dealing with this very physical thing of trees,
00:43:31
Speaker
Like not every tree can make every product. And so for all these businesses to be successful, you need to have a more collaborative sector to be able to get all the value out of all the different pieces of wood that are coming off the landscape, whether it's a saw log that's going to make two by fours,
00:43:54
Speaker
or a Dr. Sustry that's going to make some chips and maybe go to energy or something. You really need that level of collaboration and public-private partnership. We need
00:44:06
Speaker
the folks, especially out West, we have a lot of huge tracts of land that are owned by the Forest Service. There's big state forest, there's also a big industrial timber ground. And to be able to do the sort of management that we need to do out in the landscape, like we need to be partnering with the Forest Service, with state agencies, with county governments and with
00:44:31
Speaker
diversity of businesses to be able to collectively be successful. Is that something that you see more now, state agencies, counties? Yeah, absolutely. I think there's been two, just in my, the last
00:44:55
Speaker
that just shy of 15 years, I guess, that I've been involved with the forest products industry. I think I've seen two things. One, a lot more collaboration like we're talking about between agencies and industry and landowners and regulatory agencies as well. The Forest Service, for example, understanding that it's not
00:45:23
Speaker
it's not a bad thing for industry to make money from,
Sustainability and Carbon Reduction in Forestry
00:45:30
Speaker
and it actually can help facilitate the forest restoration and the forest management that the Forest Service doesn't have the money to do themselves. And so it's kind of, you know, you need both halves to make a whole. And then, you know, the other thing I think there's been a really remarkable change in public opinion. I think there's still,
00:45:51
Speaker
an uphill battle in some cases. But I think just these catastrophic wildfires have really helped to change the public opinion around forest management in general. Just realizing if we don't do something about the problem we have in the forest, we're going to lose it. And then it also has
00:46:15
Speaker
implications in terms of all these climate goals that we have. You look at the fires in California in 2021, and there was just a study that was put out by University of California that showed one fire year emitted as much carbon as a third of all of California's carbon combined. So transportation, buildings, power generation,
00:46:41
Speaker
a third of that equivalent was emitted in one season of wildfire. I think the public in general is really coming around on this idea of needing to manage the forest in order to mitigate these wildfires and also create sustainable products that can be used and displace carbon intensive products elsewhere.
00:47:09
Speaker
Yeah, not that long ago we were the bad guys, remember? Yeah, exactly. And there still are some people that would say that, but I think by and large we've gone past that. I think so. Now, it's a great change for everybody to understand that actually we contribute to the solution, to provide a solution for the environmental problem that we're facing.
00:47:41
Speaker
What are other innovation or great ideas from both organizations that you guys manage that you see upcoming up here that you would like to share with our audience? Yeah, I think just over the past two years, I mean, I said earlier, we kind of seen this like whole range of innovation. Last year, we had a couple of companies that were like
00:48:09
Speaker
developing new ways to sell logs more efficiently, to use byproducts to heat and power manufacturing facilities that I think were all like valuable.
00:48:21
Speaker
to people in the industry. And this year, seeing several building materials companies that I think are a whole new type of company that are potentially addressing housing challenges while also using wood. So making a whole range of building materials, products, new types of wood that I think is really exciting.
00:48:50
Speaker
And we're hoping to continue to see like that, these different types of companies that will have an impact on the industry in different ways and have potential to grow. And like that said, they can both make money and will also benefit in their community and benefiting the industry.
Exploring Biochar: Agricultural and Environmental Benefits
00:49:08
Speaker
And Matt, from your perspective, your region there. Yeah, I think the, you know, I would echo exactly what Jared said and then I think the,
00:49:18
Speaker
the building materials sector is changing dramatically and it's being driven by these new products that are wood-based. So whether it's CLT or other mass timber panels or all kinds of different fiber products that are coming out, including a few that are in the accelerator program this year, I think that already has been transformative for the wood products industry and I think that
00:49:46
Speaker
It's really the future of building instruction, frankly, that there's going to be a lot more wood involved in buildings, including high-rise building. There's a building here in Portland where you might be familiar. It's 13 stories. There was a CLT building that got put up in Northeast Portland, and so there's
00:50:10
Speaker
There's really a movement towards mass timber construction and different wood fiber-based construction materials that is really transformative. Just to speak to our business specifically, I'm really bullish
00:50:30
Speaker
you know, both about Woodstraw in large part, thanks to the accelerator, but I'm excited about biochar. I think that, you know, biochar represents a way to enhance agricultural operations, especially in rural communities that are, you know, at the frontline of these wildfires and sort of connect the dots from the forest to the farm.
00:50:55
Speaker
in a way that's really beneficial, especially in a world that's getting more and more water scarce every year, it seems like. I think biochar has a real potential to have carbon benefits, help facilitate forest restoration, help grease the wheels of forest products businesses, and then drive real benefits on farm. Matt, for those who don't know or aren't familiar with what biochar is or
00:51:24
Speaker
what it does, how it works. What is biochar in a nutshell? And feel free to share more about it. If you're excited about it, let's hear about it. Yeah. So, you know, biochar is, it's basically charcoal that's applied to agricultural soils. And, you know, from a
00:51:43
Speaker
From a technology perspective, you produce it by pyrolyzing wood, and so you basically heat wood in an oxic environment and end up with the carbon structure of that wood.
00:51:58
Speaker
Biochar is typically somewhere between 80% and 90% pure carbon. But when you burn off all the volatile gases, any of the TARS, all that stuff, and end up with that carbon structure with woody biomass in particular, the structure of the biochar is the structure of the cells.
00:52:20
Speaker
and the strong cellulosic walls is maintained when it's paralyzed and made into the biochar. And so you get this really incredible thing that happens where a tablespoon of biochar will have something like 50 square meters of surface area.
00:52:37
Speaker
because of all those pores from the salosic walls that were in the original cells in the wood. And what that means for a farmer is that those pores are kind of little docks for nutrients and water. And so when you apply it to agricultural soils, you pretty dramatically enhance the water and nutrient carrying capacity of those soils.
00:53:08
Speaker
That's pretty incredible. And it's a use case for wood. Yeah, it's a use case for wood. And it's, you know, I mentioned earlier, you know, new innovations, but also old innovations being invigorated. I believe it was the Incan Empire, the terra preta was the first known use of biochar to enhance agricultural soils.
00:53:32
Speaker
And from a carbon perspective, the biochar that they used, that was four millennia ago, that carbon is still embedded in the soil and hasn't been emitted. So there's a real, very real climate impact of converting wood to biochar and putting it in soils. Mario, is that right?
00:53:57
Speaker
I don't know, I'm the first time that I hear that, but curious about the technology, what does it take to develop that, to do it? So the majority of the biochar that's made in the States now is basically high carbon fly ash. So there are some plants, biomass one in Southern Oregon is one of them that have converted their ash removal system from a traditional biomass power plant.
00:54:27
Speaker
to capture prior carbon material coming out the back end. And then they can, through some post-processing, they can isolate the biochar versus the ash. Sometimes that ash actually has a real benefit to agricultural operations in and of itself.
00:54:43
Speaker
But that's kind of the most common way right now. The future of biochar production I think is either a kiln or a continuous rotary, either a stationary batch kiln or a continuous rotary kiln that basically allows you to put
00:55:03
Speaker
clean wood in, it's dry, it has to be dry to get good production. But you put wood in, you heat it, and then it recycles the gases. So it takes, the volatile gases that are cooked off the wood are then used to burn. So it ends up being, typically when manufacturing biochar, there's a startup period that needs to use an outside fuel source.
00:55:28
Speaker
But the reaction is basically self-sustaining. The thermodynamics are such that you can take those gases, burn them, and finish paralyzing the material and making a good biochar without any additional energy input.
00:55:40
Speaker
And oftentimes, the better systems can actually provide some heat takeoff, and that heat takeoff can be converted into electricity as well. So you can have projects that are combined heat and char are probably the most common in terms of the new technologies that are coming out, but there also are projects that are heat, power, and char. Yeah, yeah. There's a lot of very,
00:56:10
Speaker
are people working on voucher right now, so. Well, Vadim, I have a follow-up question, but we can edit this portion, just for Jake to know, but is this the same material that I read and I've been talking to people, I mean, 10 years ago about this?
00:56:31
Speaker
And it has a lot of power, like an energy power. Is that the same product or not? I think what you're referring to is probably torrified wood.
00:56:45
Speaker
we're talking about, which is a similar process, but it's not. Yeah. Torified wood is, is, you know, there's a lot of talk of using torified wood to replace coal or co-fire with coal. Yeah. That's what I was thinking now when you were talking about. Yeah. That's right. Yeah. So that, Dusty Addison in Portland, he, he used to have, he was representing the
00:57:12
Speaker
technology to do that. So that's when when you're explaining the, the other product, it made me think of that. Yeah.
00:57:21
Speaker
Yeah, the biggest difference between, it's a different operating temperature that torrefaction happens at. And if I understand correctly, part of the reason why it can be co-fired with coal is because some of the volatile gases are left in the material. And so when you co-fire it with coal, it actually has a lot of energy potential. You can burn biochar.
00:57:48
Speaker
But it's it's much harder to light than even like a charcoal briquette like you might see. I see. Thank you. Yeah. And we can continue with it. Yeah. I just sent it in the chat and their vision was to replace coal. So they were like turning
00:58:13
Speaker
easily transition to their product. It was a big undertaking. Yeah. Can you share more about that, Jared? Is that something we do publicly as well? I don't know where they're at right now. To be honest, my hunch is that it didn't work out, that they just were never... I think there were challenges with having a European customer as their beachhead market and that they are not all that interested in buying significant amounts of
00:58:43
Speaker
products from the US, I think it was somewhat political. So I don't know. Yeah, I have to reach out to them and see where they are. And they just need a ton of money. It was like a pilot plant was 12 million and to really get to full production was pretty expensive. But it had these benefits that it could,
00:59:04
Speaker
Yeah, replace coal, it was water resistant. So it would significantly lower shipping costs where it's, yeah, I mean, currently you need like these huge covered infrastructure at ports in order to like ship pellets. So it had all these benefits, but it also had some big challenges to launching.
00:59:29
Speaker
Gotcha.
Career Opportunities and Workforce Challenges in Forestry
00:59:31
Speaker
If I can switch the topic here for a second, first of all, Jared, Matt, off script, are we good on time-wise? Can we go for a couple more minutes? Do you have to run? Yeah, I have a hard stop at one, but I can go till the end. All right, before you guys' time. Jared, are you OK for a couple more minutes? Yeah, I'm good.
00:59:52
Speaker
Okay, and back to our regular scheduled programming. Also in the wood product sector, we're hearing a lot that the need for more talent, more jobs are coming online and there aren't people there to fill those jobs. Could you both maybe speak to the career opportunities that you know of, heard about,
01:00:16
Speaker
That are opening up what's the what's the career opportunity like for me folks who are not in the space yet that are looking for work or younger professionals who are looking for a career path. Is wood products a place where people should look at for continuing and building a career for the long term you know so.
01:00:39
Speaker
Can we go can we talk about that for a second? Could you highlight what skills or knowledge they might need to go down this to find success in our industry and the wood product sector in the wood forestry and the wood world? I feel like there's two parts. I mean, the first is a
01:00:59
Speaker
of meetings at like the state level where workforce is this constant challenge. So I do think there is this opportunity for existing businesses to better leverage technology to address workforce challenges. And so I think that is where there's some overlap with the programming that we're developing and an opportunity for existing companies to partner with emerging companies that are helping to address some of those challenges.
01:01:27
Speaker
I mean, all industries are facing workforce challenges and I do think that is like, there's some specific challenges in the forest industry.
01:01:38
Speaker
But I think what is really interesting is jobs are changing a little bit. And there is this huge range of new skills that are needed. I mean, jobs in the forest industry cover anything from and as new technology is emerging, a lot of those jobs are both requiring higher skills. I mean, there's engineers and
01:02:01
Speaker
knowledge of technology, so there are new skill demands, but then it also covers a whole range of jobs from people working in the woods, foresters, loggers, manufacturers, engineers, and emerging technology is both introducing
01:02:18
Speaker
demand for new types of skills, but also might create jobs that are appealing to a new set of people and bring new individuals into the forest industry. So I think that is exciting. Totally. Matt, your thoughts? Yeah, I think the workforce challenges are very real. I mean, I think for us,
01:02:44
Speaker
We've, especially after COVID, we've had this situation where, um, you know, we did the mill is in this County that had 7,000 people in the first place. So not a huge potential workforce. Uh, and then then with COVID, there was a lot more, there was a huge influx of people buying second homes because it's a beautiful mountainous area.
01:03:09
Speaker
Being able to work from home this and that and so we've had We've had many people that we've offered jobs to that were unable to take them because they live from outside the area and couldn't find a place to live So I think there are there's a need for
01:03:26
Speaker
innovation around the manufacturing side for a business like ours to be able to require less people to make the same amount. That same circumstance is creating real opportunities for the trade. So mill rights, the people that are
01:03:49
Speaker
fabricating, fixing, maintaining equipment in our facility have always been in short supply. And that's the sort of position that could certainly become a career. There are lots of mill rights that have been in that trade and worked up from apprenticeship through senior lead maintenance manager over the course of a career.
01:04:13
Speaker
then there's just that kind of operations management supervisor style position. There's a ton of need there as well. So kind of people that are interested in learning about manufacturing technologies want to be in a business that really makes things and have the skills and the drive to
01:04:43
Speaker
manage people and manage a facility. I think there's a huge amount of career opportunity there as well. The workforce constraints have been exceptionally challenging for our business and continue to be the number one challenge that we face day-to-day.
Closing Thoughts and Appreciation
01:05:06
Speaker
We need to convince the new generation of younger people
01:05:13
Speaker
that working in forestry is a great place to be, you know, you can share the time that they working inside, outdoor, doing many things. And people, I don't think people realize how good it is, the environment to be sharing your daily hours in so many activities. And also the other thing that probably people don't realize
01:05:42
Speaker
how good the people in the wood industry is. They're very good people in general. Sometimes you don't find that in other industries. And in our people here are very, you know, strong values and hard workers, but at the same time, very good people. Yeah. Yeah. That's right. You were talking about, I'm sorry.
01:06:06
Speaker
I was just gonna go into our conclusion and say just thank you so much for opportunity to speak to you, Jared and Matt. Thank you so much for bringing your passion, excitement, energy for the industry, for wood products, for the wood world. And also just to learn, Matt, specifically about the products and innovations that you're working on and how going through the program that Jared and their team are pioneering
01:06:36
Speaker
managing and allowing forest products to gain more innovations to develop things. We just want to thank you both for your time, for your insight, any last comments, kind of like to wrap up our conversation here today, any last messages or key takeaways that you'd like our audience to remember, please share those now. Jared, we can start with you and Matt to you.
01:07:02
Speaker
Yeah, I appreciate both of your time and it was great to join, talk more about the Forestry Accelerator. I'm definitely, you know, where I was looking to continue to build connections with the industry and have conversations, identify where people in the industry see opportunity for innovation startups and build those partnerships. So definitely looking to leverage this to build our connections and let people know about these opportunities to work with emerging businesses. Absolutely.
01:07:34
Speaker
Yeah, I'd just say, you know, thanks for the opportunity to talk wood. I really enjoyed talking about this stuff and thinking about this stuff. And so, yeah, it's been a pleasure to be on with you guys and to meet you. And definitely want to thank Jared and the Forest Accelerator Program, ECOSVC, just been hugely beneficial for me personally and for our business and the development of this new product line. So we're grateful to be a part of the program.
01:08:09
Speaker
Any last words? No, I'm very excited to have you both here in our Wood World Podcast. It's cool to find people with the passion and the knowledge and the expertise that you guys have. So keep doing the good work there and helping the
01:08:30
Speaker
helping the rural communities, helping bring innovation, making people excited to join our industry. So keep doing what you're doing. Amazing. Thanks for tuning in to the Wood World Podcast. Now go out there, embrace the grain, make your mark on the world of wood.