Kitchener-based Trusscore has raised CDN$26 million in Series A funding that will help the maker of sustainable building products expand its production, marketing, sales and R&D capabilities.
The investment was led by Round13 Capital of Toronto through its newly launched Earth Tech Fund.
“Our new Earth Tech Fund is our first environmental, social, and corporate governance (ESG) fund,” said Round13 General Partner Craig Strong. “As a company that is disrupting the status quo in a legacy industry that causes millions of tons of waste annually, Trusscore is the perfect first investment to launch this fund.”
In addition to Round13, other participating investors include a long list of Waterloo Region tech founders.
“I was just amazed by the number of serial tech entrepreneurs who have faith in Trusscore and, I assume, in me,” said CEO Dave Caputo, a serial founder himself who also serves as Chair of the Communitech board of directors. “I’m very humbled.”
Trusscore’s flagship product is a high-strength polymer alternative for drywall called Wall&CeilingBoard. The tongue-and-groove interlocking system allows for quick installation and provides a smooth finish that is easy to clean, durable and low-maintenance, according to the company.
One of the concerns with drywall, which is made of gypsum, is the toxic gas that is created when it is buried in landfill sites. While many landfill operators enforce diversion and recycling options for drywall, it still generates a lot of waste each year.
A 2016 paper by two researchers at the University of Manitoba says that between 496,000 and 585,000 tons of drywall waste is generated annually in Canada, accounting for about nine per cent of the total waste generated from construction and demolition activity in the country. Across North America, drywall makes up between 12 and 27 per cent of annual construction and demolition waste.
Trusscore says its products are fully recyclable at end of life, and any waste product can be reground and reused to make new materials. It also says it uses recycled materials wherever possible to offset the use of new material.
“We are determined to help change the environmental impact of the construction industry with sustainable products that help build a better future for generations to come,” Caputo said. “This investment in Trusscore will serve as fuel for our growth. Our focus on innovation and material science is driving real demand for our sustainable alternatives to traditional building materials.”
The Series A funding will be used to boost production capacity, R&D and marketing and sales.
“Given the capital-intensive nature of manufacturing, a lot of this money will be used to set up new production lines in Palmerston, Ontario, in Dayton, Ohio and in Calgary,” Caputo said. “And for sure we will build new plants and for sure we will acquire plants.”
Trusscore’s history reads like an “only in Waterloo Region” business story, where a mix of tech, farming and manufacturing expertise came together to create something new and innovative.
The company is built on the groundwork laid by MSW Plastics, a Palmerston-based manufacturer known for making panels that separate livestock and protect them from disease outbreaks, such as swine flu.
The fast-growing company caught the eye of Caputo shortly after he had engineered the sale of Sandvine Inc., an internet traffic-management company that he co-founded and later took public.
Caputo, who has a long-held interest in finding an alternative to traditional drywall, teamed up with MSW partners Joel Koops and Steve Bosman, a former hog farmer with an interest in technology and manufacturing.
The trio relaunched MSW Plastics as Trusscore in late 2019 with an emphasis on material-science R&D and a plan to disrupt the drywall and construction-products industry.
“At our heart, Trusscore is a material-science company for sustainable building materials, with the ultimate vision of replacing painted drywall,” Caputo told Tech News.
The drywall market – and the opportunity to replace it with a simpler, more sustainable alternative – is “huge,” said Caputo, who’s fond of telling acquaintances to look around and notice the enormous amount of drywall in homes, offices and other buildings.
In early 2020, Trusscore raised CDN$5.3 million in seed round funding. In July 2021, it acquired Calgary-based Westech Building Products. Trusscore now operates manufacturing facilities in Palmerston, Calgary and Dayton, Ohio, and has an office in the Communitech Hub in downtown Kitchener.
The number of Trusscore employees has grown to 200, including 15-20 employees who work in the company’s newly established R&D department and another 15-20 employees in its expanded marketing and sales unit.
Caputo said Trusscore researchers are working on “the chemistry and nano-material side,” developing product enhancements such as increased durability, fire resistance and light reflection. The group is even looking at the benefits of “digital paint” and the possibility that wall and ceiling colours could be changed via an app.
“There’s been a revolution in material science, particularly around this synthesizing of nano materials,” he said. “Our goal is to come out with new formulations so that we can extrude products that have more and better features than drywall.”