Manta Biofuel is raising at a $6 million valuation cap with a 25% discount. Given how revolutionary the technology is and how widely it could be used, this seems to be an extremely low valuation. Thus, Manta Biofuel’s price score is strong.

Manta Biofuel operates within the (renewable) crude oil industry, which as a whole has a total available market of $2 trillion. It plans to start out by providing heating oil, which the EIA claims was used by 5.5 million households in the United States in 2018. This amounted to 3.6 billion gallons of total oil used to heat homes.

As Manta Biofuel continues to grow, it plans on entering the marine fuel and heavy industry market. With the growth in e-commerce and the buying of goods from China, shipping products back and forth on oil powered ships is a huge market that isn’t ready to leave oil behind. This represents a huge market opportunity for Manta. 

Finally, the company plans on being able to target refineries and large oil companies in order to break into the overall crude oil market. As companies slowly adopt the idea of carbon neutrality and mitigating their effect on the environment, Manta Biofuel is expertly positioning itself as an oil company with a decreased impact on our planet. This could lead the company to becoming an industry leader in the renewable crude oil market.

Manta Biofuel has formulated a savvy and logical approach to entering the renewable crude oil market. This well-formulated plan is reflected in the company’s extremely high market score.

One of Manta Biofuel’s founders, Ryan Powell, has a Ph.D in algal biofuels from the University of Maryland. He has real life experience with large scale agriculture, growing up working on his family’s 2,000-acre grain farm. The other founder is Onur Unal, who oversees the business and fundraising. Unal is a seasoned entrepreneur, with over 15 years in the biotechnology industry.

Powell’s real life agriculture experience and his academic knowledge of renewable algae make him well suited to lead a company like Manta Biofuel. Add in Unal’s entrepreneurial background, and there is a very good duo heading this renewable crude oil company. Manta Biofuel’s team score is strong due to this well-paired founding team.

The tech that Manta Biofuel brings to the renewable crude oil industry is nothing short of revolutionary. Using algae to make oil is already a forward-thinking idea, but Manta Biofuel takes it one step further by innovating within this already niche space. The company’s patented approach to harvesting the algae is inspired by agriculture – naturally growing the algae and collecting it with Manta Biofuel’s own magnetic harvesting machine. This process has been tested and has shown it has the ability to harvest over 200,000 gallons of algae per day.

Manta Biofuel is a company that provides a carbon neutral, renewable way of obtaining oil – both descriptors that are vastly different from other oil companies. Although one could argue that Manta will have to compete with more traditional oil producers, the differentiator of producing renewable oil sets the company apart. There is some risk of future competitors in the renewable energy sector, but Manta Biofuel seems to have a first mover advantage at this time. Thus, the company’s differentiators score — like its market score — is near perfect.

Thus far, Manta Biofuel’s operations have garnered them much support and interest from third-party entities. The Department of Energy has given $2.2 million in grants to the company. It has been selected by the Maryland Energy Innovation Accelerator for two cleantech programs and was a finalist for the Department of Energy Clean Energy Challenge. Manta’s third party successes date all the way back to 2015, when the Chesapeake Bay Seed Capital Fund awarded the company a $150,000 investment.

As for the financial performance, there is much room for growth for Manta Biofuel. It has managed to run at a slight profit, and that’s before any government given subsidies for their carbon neutrality. As the company continues to grow, profitability prospects are looking very good. Manta Biofuel’s high performance score reflects both these early successes and its promising path to profitability.

The goals that Manta Biofuel has for itself are lofty – and a failure to procure enough funding could leave it struggling or failing (the company itself says, “If we are not able to raise sufficient capital in the future, we may not be able to execute our business plan, our continued operations will be in jeopardy…”). Beyond this, the manufacturing of its products is dealt with by external companies, and any delay or malfunction in product could lead to a downturn of trust against Manta Biofuel. It must continue to scale efficiently if it hopes to grow into a company with a sizable stake of the oil industry.

On top of these internal potential problems, the continuing drop in oil prices is also a concern. Global oil demand is set to drop 9.3 mb/d (millions of barrels per day) due to COVID-19.

The world continues to make a push towards renewable energy. In 2020, electric vehicle stocks have shot up (such as Nio, Xpeng, Tesla, etc.). Solar and wind stocks have also followed suit (ETFs ICLN and TAN). The market has been rewarding companies who have a green outlook (environmentally speaking), and Manta Biofuel fits within that umbrella.

The technology the company brings to the table is revolutionary – providing comparably priced crude oil with a net zero emission of carbon into the atmosphere. The Department of Energy seems convinced that Manta Biofuel is a company worth watching, as they’ve given multiple grants to the company. Manta Biofuel is still very early in its development, but with a shift towards renewables and the revolutionary renewable oil technology it brings to the table, it looks well positioned to grow exponentially. Additionally, the low valuation on this raise makes this an excellent opportunity for investors to get in on a promising startup with a very reasonable price.