Biotech company Mushroom Material aims to remove polystyrene from the planet

Shaun Seaman

Founder Shaun Seaman is on a mission to eliminate non-recyclable plastics from the environment – and redefine sustainability.

For mechanical engineer and Mushroom Material founder Shaun Seaman, an entrepreneurial career was inevitable. “Both my parents and step-parents all started their own businesses, so growing up I always had the intention of doing the same,” he reflects. “The start-up world fascinated me.”

However, what form his entrepreneurial ambitions would take was less clear – until a surfing holiday in Indonesia in 2018 proved eye-opening for all the wrong reasons. Expecting to explore the pristine waters of the Indian Ocean, Shaun was heartbroken by what he discovered instead: a sea of floating plastic bags and once-stunning beaches covered in expanded polystyrene (styrofoam). “For months after this I woke up in the middle of the night panicking about what we are doing to the environment,” he recalls. “I realised that this was what I wanted to dedicate my life to.”

Two years after that fateful trip, Shaun launched Mushroom Material, a biotech company which develops mushroom-based materials as a sustainable alternative for packaging. His vision was aspirational from the outset. “My goal has always been the same – maximum positive impact to the planet,” he says. “We have the opportunity to tackle a global challenge head-on: the staggering 30 million tons of polystyrene discarded annually. We’ve developed a solution poised to disrupt the market and redefine sustainability.”

Mushroom Material takes agricultural waste and mixes it with mycelium, the vegetative, root-like structure of fungi. The mycelium grows around the agricultural waste, consuming it and binding it together as a natural adhesive. The resulting material is then turned into small pellets, which can be moulded using the same equipment as traditional polystyrene.

As a material, mycelium is pretty miraculous. “Fungi offers phenomenal impact resistance – the strands of mycelium have the ability to rebound from compression over and over again, making it a fantastic protective packaging material that is sustainably produced,” explains Shaun. “And because the mycelium has consumed the agricultural waste in the growth process, the material is 100% home-compostable at end of life.” What’s more, the product’s potential applications are numerous. “We can replace expanded polystyrene in every application, from protective packaging to thermal insulation to acoustic insulation – and everything in between,” he says.

Such an effective solution to the polystyrene problem belies the difficulty of the development process. Shaun specialised in composite materials for the final year of his engineering degree at Waipapa Taumata Rau, the University of Auckland, and began his career designing plastic injection moulding equipment at Fisher and Paykel Appliances, but working with biomaterials has been quite a learning curve, he says. “It’s taken us four years to figure this out, so it’s safe to say that it’s been a hell of a challenge!”

Fundraising in New Zealand proved another significant challenge for the start-up. “We actually had a term sheet from a New Zealand investor, but it didn’t sit well with us, so we made the toughest decision of our lives – to say ‘Thanks, but no thanks’, even though we were running out of money,” remembers Shaun. He headed offshore to seek funding and eventually secured the support of Singapore-based Wavemaker Partners, who led the venture’s recent $8.5 million seed funding round. “They have easily been the most supportive investors we could have asked for – absolutely worth the risk in the end,” he says.

Although physically located in Auckland, where the team is currently building a pilot line, Mushroom Material is headquartered in Singapore. “Singapore offers a much healthier venture capital space and is closer to our customers, who tend to be based in Southeast Asia,” explains Shaun. “The venture capital space in New Zealand is very small. Although we were incredibly grateful for the early support we received from Icehouse Ventures, which was invaluable in getting Mushroom Material off the ground, we knew early on that we’d need larger funding than New Zealand offers.”

However, our country remains a great place for research and design, he notes. “The ‘number eight’ mentality is a real thing! I think it’s because we don’t have a lot of the international brands in New Zealand, so we have to solve our own problems using the tools around us. The most resourceful engineers I’ve worked with have been Kiwis.”

Shaun’s early entrepreneurial experiences – which included attending seminars at the Business School’s Centre for Innovation and Entrepreneurship (CIE) during his time at university – have been integral to Mushroom Material’s success. Both he and the other members of his founding team worked at CIE spin-out StretchSense Limited, a supplier of smart silicone stretch sensors for use in wearable technology. “That adventure was all the entrepreneurial experience we could possibly have asked for,” he observes. “The exposure was invaluable, and we often refer to our learnings from StretchSense and the ever-wise Ben O’Brian and Todd Gisby, CEO and CTO at the time.”

Gaining admission to the globally-recognised Techstars accelerator programme – only the second New Zealand company to be accepted – was also pivotal. “Within 24 hours of being accepted, we had a term sheet from Icehouse Ventures,” says Shaun. “Techstars have an ethos of ‘give first’, and the community they’ve created is incredibly supportive.”

The start-up has closed out 2024 with the distinction of making the Cleantech 50 to Watch list compiled by global research consultancy Cleantech Group, the leading authority on cleantech innovation. Closer to home, but equally significant, Mushroom Material has been recognised as an “up-and-coming” company by Callaghan Innovation.

What Shaun is most proud of, however, is the “incredible” Mushroom Material team. “We’ve assembled a group of uniquely talented individuals, all united by a shared commitment to making a difference,” he says. “Their dedication inspires me every day.” He does note, however, that it’s relatively easy to attract good people when their day-to-day work is so rewarding – and it’s set to become even more satisfying as they achieve their immediate goal of getting their product into customers’ hands. “We’re finally into the fun part! Testing our products with customers is what I’ve been waiting for,” says Shaun. “Watch out world, here we come.”