Early Stage

Replacing plastics with biomaterials

Replacing plastics with biomaterials


Raised this Round: Raised: $127,594

Total Commitments ($USD)



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Min. Goal
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Security Type

Equity - Common



SEC Filing Type

RegCF    Open SEC Filing

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Year Founded



Industrial Services

Tech Sector


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Capital Intensity



Wilmington, Delaware

Business Type


StarchTek, with a valuation of $10.6 million, is raising funds on StartEngine. The company is developing an innovative starch-based manufacturing licensing solution as an alternative to Styrofoam. The business is in the prototyping stage and using its sustainable, patented formulations, extrusion process, and proprietary equipment to replace plastics with biomaterials. StarchTek’s StarchaFoam aims to protect packaging along with protecting the environment. John Danny Dubuk founded StarchTek in October 2020. The current crowdfunding campaign has a minimum target of $10,000 and a maximum target of $1,070,000. The campaign proceeds will be used for growth and expansion.

Summary Profit and Loss Statement

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Financials as of: 06/05/2022
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The world produces 14 million tons of Styrofoam — also called polystyrene — every year. This petroleum-based material is lightweight and ideal for cushioning appliances, providing insulation, and keeping food fresh. But Styrofoam is nearly impossible to recycle. As a result, it accumulates in landfills and takes 500 years to disintegrate. And its pollutive effects don’t end there. Styrofoam’s decomposition produces microplastics that end up in the ocean and ultimately in human bodies. 

Politicians seem to be taking Styrofoam’s health and environmental issues seriously. California recently passed a law requiring Styrofoam use to be cut by 25% by 2025, and if this goal can’t be met, the material will be banned. Because the material cannot be recycled, this law is akin to a Styrofoam food packaging ban for the more than 39 million inhabitants of the Golden State. Styrofoam food packaging is already banned in other countries, including India, France, and Australia.

StarchTek is developing a patented starch-based Styrofoam in collaboration with Michigan State University. The company’s material comes from plant-based products, is fully biodegradable, and dissolves in water. StarchTek’s products are currently in the prototype phase. StarchTek wants to sell its products at prices similar to those of petroleum-based Styrofoam, so it’s avoiding the costs of owning a plant. Instead, the company is talking with major polystyrene producers to license its formulas and manufacturing process. 

StarchTek’s current StartEngine raise has been rated a Neutral Deal by the KingsCrowd investment team. 

Next Section: Price


StarchTek is offering equity at a $10.6 million valuation. As of 2021, the company hasn’t generated any revenue yet. This valuation is based on two things: its substantial product development progress and the large hole the company’s technology potentially plugs in a growing market. Considering that it’s in its last stages of product development, StarchTek’s valuation is fair.

Next Section: Market


StarchTek is trying to disrupt the global expanded polystyrene market, which was valued at $10.4 billion in 2022. This market is growing at a moderate annual rate of 4.8%. More importantly for StarchTek, most Styrofoam used for construction and packaging is petroleum-based. There are a few small starch-based polystyrene companies operating in the market, including TemperPack. But StarchTek has plenty of room to grow in this market. 

StarchTek benefits from two sources of momentum. First, inflation and the increasing price of petroleum are driving polystyrene prices to historic highs. This opens up new opportunities in the market. Polystyrene industry leaders may want to reduce costs by considering alternative materials. Second, single-use plastics and polystyrene are increasingly being banned in several regions of the world. California will require Styrofoam food packaging to be recycled at a rate of 25% by 2025. But petroleum-based Styrofoam is nearly impossible to recycle and isn’t biodegradable. So this law is essentially a ban on polystyrene that will force California-based manufacturers and retailers to find alternatives in the next few years.

Most countries only ban the use of polystyrene for food packaging and cutlery. These regulations do not significantly open the market for StarchTek. And politics could prevent governments from enacting additional regulations to drive the bioplastic market. 

But a growing number of consumers prefer companies that have clear environmental initiatives. StarchTek can benefit from the growing environmental, social, and governance trends in the U.S. and around the world.

Overall, StarchTek has promising market prospects. The company benefits from the global increase of petroleum-based polystyrene prices. Despite the slow advance of plastic bans and the low growth rate of the polystyrene market, StarchTek is one of the few companies that could acquire market shares under these circumstances. It can also benefit from the environmental initiatives taken by an increasing number of companies.

Next Section: Team


John Danny Dubuk is StarchTek’s CEO, founder, and only employee. He is a serial entrepreneur who founded four financial companies. Two were consulting and financial management companies. The others focused on mobile payments but did not exit. This experience demonstrates that Dubuk has an entrepreneurial spirit and can handle the ups and downs of running a company. But he has not yet proven his ability to generate liquidity for investors.

In his last position as a chief financial officer for Vericool, a sustainable packaging company, Dubuk did extensive research on starch-based foam in order to lower production costs. The knowledge he accumulated made him understand the biggest challenge facing starch-based foam producers: the market power of petroleum-based competition. The competitors’ assets and resources make it almost impossible to compete on a price level without losing millions of dollars. His understanding of this issue convinced Dubuk to launch his own startup, StarchTek, and work with competitors instead of against them.

Dubuk has the knowledge, experience and passion necessary to lead StarchTek. But he is the only employee of the company. He works with consultants, a marketing agency, and researchers from Michigan State University. StarchTek’s founder is an asset at the early stage of the company, but he will need to quickly hire talent to lock in sales and build relationships with the clients of his licensing solution. 

Next Section: Differentiators


StarchTek has two types of competitors: well-established producers of petroleum-based expanded polystyrene (EPS) products and small businesses trying to bring starch-based Styrofoam to the market. Most of the legacy EPS producers have large production capacities. Cellofoam has 14 plants, Atlas Molded Products has 16 locations, and Storopack has 21 locations. Thanks to their scale, they can lower their costs and capture large shares of the market. Most EPS manufacturers can adapt the shape of their products to their clients’ needs. StarchTek doesn’t have a similar scale. If it tried to acquire expensive equipment and produce its StarchaFoam product — a starch-based compostable foam — in its own plant, it wouldn’t be able to price it competitively. A licensing solution is StarchTek’s only chance to compete with legacy EPS manufacturers on price.

In the second quarter of 2022, EPS manufacturers in the United States sold their products for $3,315 per ton, equivalent to $1.66 per pound. The price increased by 20.1% compared to the first quarter of 2022. On the consumer end, the final price of polystyrene depends on the shape of the product. Uline resells foam rolls at prices ranging from $5.62 to $12.20 per pound. It also resells polystyrene sheets from $0.20 to $1.35 per square foot based on the thickness.

A few companies are starting to sell starch-based polystyrene. Uline resells starch-based biodegradable foam sheets as a retailer. Its prices range between $30.50 and $33.30 per pound

TemperPack sells ClimaCell, a polystyrene alternative case made of 90% corn starch and paper. It replaces petroleum-based polystyrene used to keep items cold or fresh during shipping. Its target market is smaller than StarchTek’s, but it has well-defined branding and existing clients. TemperPack sells its box panels on Uline’s website at prices ranging from $6.46 to $12.60. Even if the product appears cheap, it’s less versatile than other polystyrene products given that its use is restricted to the shipment of cool products. However, ClimaCell could become a more direct competitor against StarchTek if the firm decided to expand its business model.

StarchTek’s StarchaFoam panel costs $0.45 per square foot for end users, according to the founder. The company’s foam roll, called StarchaWrap, costs $10.10 per pound. These prices are comparable to Uline’s petroleum-based polystyrene sheets and rolls, so StarchTek’s business model is competitive. StarchTek also sells cases similar to TemperPack’s for $2.35 or $2.70. StarchTek’s prices are at least three times cheaper than TemperPack’s prices, and TemperPack has already raised $208.9 million. Based on the company’s data, a StarchaFoam cardboard case is slightly more effective at insulating cool temperatures than TemperPack.

StarchTek has exclusive rights on eight patents from Michigan State University to create its starch-based polystyrene. While its patents do provide StarchTek some defensibility, it’s limited. Even if StarchTek’s competitors use different methods to create polystyrene alternatives, they could still offer products with similar functions. 

Overall, StarchTek is well-differentiated. StarchTek’s products are cheaper than the few other companies selling starch-based expanded polystyrene. Its projected price is also similar to the price of traditional EPS producers thanks to its licensing model. The company can provide large EPS firms with a cost-efficient and eco-friendly product without waiting for governmental bans on petroleum-based polystyrene.

Next Section: Performance


John Danny Dubuk founded StarchTek in 2020. StarchTek is developing its products — which are still in the prototype stage — thanks to its partnership with Michigan State University. It has exclusive rights to eight of the university’s patents in exchange for a convertible note worth $10,000.

According to Dubuk, StarchTek will begin to generate revenue between six and 24 months from now (July 2022). This will depend on its funding, research and development, as well as its deals with expanded polystyrene (EPS) firms. Dubuk said he is in discussions with large EPS firms in order to license StarchTek’s products. This business model keeps prices reasonable and allows StarchTek to compete against petroleum-based polystyrene sellers. 

StarchTek has low cash reserves, with only $694 on hand as of 2021. The company lost $203,314 in 2021, including $49,466 spent on research and development. However, this burn rate can be sustainable if the company manages to raise funds via investors or debt. Currently, StarchTek’s debt is not a point of concern. It owes a debt of $194,212 to the founder, which will only be paid if the company is in stable financial condition.

Overall, StarchTek’s future performance is uncertain. The company developed a cost-efficient prototype and business model in two years and has made reasonable progress. But the company is at an early stage, and its future development is tied to its ability to raise funds and close deals with EPS manufacturing firms.

Next Section: Risks


StarchTek is a high-risk investment. The company has not generated any revenue at this point, and despite speaking with potential customers, it has not signed any contracts yet. This delay is normal for a firm licensing a newly developed product. But StarchTek never raised money in the past, and its cash reserves are low. Without funding, it will risk bankruptcy. It needs more time to develop its product and close deals. And investors cannot be certain that StarchTek will ever be able to license its product.

At the moment, StarchTek isn’t benefiting from any government regulations against petroleum-based polystyrene. The material isn’t completely banned in any region of the world yet. Only polystyrene food containers are currently prohibited in certain regions of the world. Since StarchTek sells packaging polystyrene, it will only benefit from a restriction in California that will become effective in 2025. Though it should happen at some point, in the immediate future StarchTek cannot count on governmental bans on polystyrene to push large expanded polystyrene companies to adopt a starch-based formula.

StarchTek is in a very early stage and has only developed a prototype. The company has not yet proven product-market fit, and it will not be helped by any legislation in the short-term future. Therefore, the company is a high-risk investment.

Next Section: Bearish Outlook

Bearish Outlook

StarchTek has a noble mission: to stop the use of polystyrene and reduce pollution. But investors should note that StarchTek’s wax is made out of polyvinyl alcohol (PVOH), which is synthesized from petroleum. StarchTek’s product only contains a small amount of PVOH. And PVOH can dissolve in water, transforming into harmless molecules with the help of microbes and bacteria in wastewater plants. But this process is not perfect, and some of the PVOH in wastewater treatment plants is released into nature. Therefore, although StarchaFoam is far more environmentally friendly than petroleum-based polystyrene, it isn’t completely sustainable and still carries a slight risk of plastic pollution. 

StarchTek is in a very early stage, and its products are still prototypes. The company has yet to close its first contracts with large expanded polystyrene (EPS) companies and start generating revenue. Furthermore, investors can’t be certain that StarchTek will actually convince EPS firms to license its product. Only the California polystyrene market is expected to shut down in 2025 due to tight legislation on plastic recycling. In other parts of the world, plastic isn’t banned, so companies producing polystyrene for packaging purposes are not incentivized to switch to a more sustainable material. Adding to its unproven product-market fit, StarchTek is low on cash. This creates a financial risk for StarchTek. Without any revenue, the company could face bankruptcy if it doesn’t raise more funds through equity or debt. 

For now, StarchTek can compete against petroleum-based polystyrene companies based on its pricing and product features. Ushering in a major change in sustainability might be a complicated task for a solo founder. StarchTek founder John Danny Dubuk doesn’t have any employees and works only with a team of consultants. This limits the company’s ability to grow as well as the amount of feedback and ideas the founder will receive.

Next Section: Bullish Outlook

Bullish Outlook

StarchTek brings a much-needed environmentally friendly Styrofoam alternative to the plastic market. The company has a well-thought-out licensing business model that includes providing licensees with the raw material corn starch at a significant markup. StarchTek wants to license its product to expanded polystyrene manufacturing companies in order to keep costs competitive with petroleum-based materials. If the company succeeds in licensing to large firms, it should quickly become profitable.

Founder John Danny Dubuk developed StarchTek’s business model thanks to his experience at Vericool. He used his familiarity with the cost-related challenges of the sustainable packaging industry to improve the starch-based polystyrene business model. Dubuk has an understanding of the business and financial aspects of starch-based polystyrene as well as a technical knowledge of the product. Dubuk has the skills necessary to lead the company through its first steps while waiting to gather funds and hire employees.

Next Section: Executive Summary

Executive Summary

StarchTek produces a dissolvable, starch-based polystyrene alternative to traditional petroleum-based Styrofoam. It has the potential to solve the massive polystyrene pollution problem through its cost-effective and biodegradable material. StarchTek has exclusive rights to eight of Michigan State University’s chemically modified starch patents. On top of its unique formula, the company built a well-thought-out licensing business model to overcome the cost challenges faced by its competitors. Without tighter regulations on Styrofoam usage, polystyrene buyers are not incentivized to switch to more expensive biodegradable materials. But StarchTek achieved low prices thanks to its licensing solution and can easily compete with petroleum-based producers. Founder John Danny Dubuk has experience in the starch-based industry and has the necessary skills to lead his company. StarchTek could become a cost-efficient company and quickly increase its valuation if it signs a few contracts.

But StarchTek hasn’t signed any deals with expanded polystyrene (EPS) manufacturers yet and is still finalizing its manufacturing process. The company is low on cash, and it risks bankruptcy without funding. While Dubuk expects to have a revenue stream in six to 24 months, it’s not guaranteed that StarchTek will be able to license its technology to legacy EPS firms — which makes this investment particularly risky. Altogether, StarchTek is a Neutral Deal.

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StarchTek on StartEngine 2022
Platform: StartEngine
Security Type: Equity - Common
Valuation: $10,622,670
Price per Share: $10.00

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