Alltech staff photo
The late Dr. Pearse Lyons, far left, presents the 2017 Alltech Innovation Competition Graduate Winner award to Fletcher Young and Zach Yonts. / Photo courtesy Alltech
A Lexington startup company has patented a process for turning waste from breweries and distilleries into a more environmentally friendly and cost-effective component of water filters and some batteries.
Over the past few years, Richmond resident Steve Lipka, former associate director of the University of Kentucky’s Center for Applied Energy Research, has been honing his idea for a new company, Stillage Solutions. His doctorate is in material science, and his experience spans more than three decades in materials engineering and related industries. He also operates Faraday Energy in Lexington, which for now is providing the necessary office and lab space for his new venture.
Joining him in the company’s development and launch are lead reactor engineer Sneha Chede, whose doctorate is in chemical engineering and who is also a research fellow at the Center of Membrane Sciences at UK; business director Fletcher Young, who holds a bachelor’s degree in physics, earned an MBA from UK and now attends medical school at the Kentucky School of Osteopathic Medicine in Pikeville, Kentucky; and finance director Zach Yonts, who also has an MBA from UK and an undergraduate degree in mining engineering.
After backing up his idea with a year’s worth of research, Lipka met with Young and Yonts when they were MBA graduate students with an interest in entrepreneurship through UK’s Gatton College of Business and Economics. They joined the fledgling company in 2017.
Approximately 80 percent of waste from the distillation process, known as stillage, is discarded. Stillage Solutions has patented a process to turn this waste into activated carbon.
Stillage Solutions’ basic concept involves putting distillery waste, or stillage, through a proprietary process that produces high-quality activated carbons, which are typically made from coal, peat, wood or coconut shells. Activated carbons, also called activated charcoal, are used in a variety of industrial, medical and environmental applications. Lipka and his team said their process is less expensive and lacks the toxic byproducts of conventional production methods.
“Basically 80 percent of [distillery] waste product is discarded,” Lipka said. “It has no economic value, and so we ended up putting it into our process” with a number of useful applications.
These include the manufacturing of water filters, super capacitors and lithium ion batteries, along with the types of monofluoride batteries used in products from implantable pacemakers to utility meters and powered credit cards.
Since its earliest phase, Stillage Solutions has sought help from UK’s Von Allmen Center for Entrepreneurship, which Lipka said provided potential investor and distillery industry contacts and other information.
During his research, Lipka obtained several stillage samples from Wilderness Trail Distillery in Danville, Kentucky. Shane Baker, cofounder, president and CEO of Wilderness Trail, said the distillery produces about 500,000 gallons of stillage per week, and he counts himself lucky that there are enough area farmers willing to take it off his hands for livestock feed.
“We have enough infrastructure, if you will, in our area to support that,” he said.
In areas where there are several distilleries close together, stillage disposal can be a challenge, Baker said. It spoils rapidly, and it is costly to transport. Removing the liquid from stillage to reduce volume is almost as expensive as running a distillery itself, he said.
Stillage Solutions has fared well in startup competitions in Kentucky and elsewhere, Young said, taking top honors and winning $10,000 in the 2017 Alltech Innovation Competition, and earning second place in a business plan competition during Idea State U regionals at Lindsey Wilson College. Young and Yonts also participated in a business accelerator program in Boston last fall.
“It was a nice validation of this concept,” Young said. “Alltech really liked it a lot, and we got our name out there.”
Young said Lipka and Chede have been “the science minds,” while he and Yonts competed for cash, formulated a business plan and prepared documents. He said the membership team communicates at least weekly, often by email and text.
Now in his first year of medical school, Young said he hopes to remain a part of the company.A CEO may be hired later, Lipka said, along with employees who will refine existing processes and market the new company, but for now, there’s only the four-person management team.
Their goals include contracting with more distilleries to provide stillage and securing the financing to have a processing plant up and running by year’s end, Lipka said.
“We have a patented, vetted process,” he said. “We’ve demonstrated that it’s scalable, and I think our biggest challenge has been to find the right investors, find the right partners and get a start in demonstrating that this is a very viable technology … that, again, solves problems with waste disposal and provides value-added products, which could have a revenue stream.”