From Forest Industry Byproduct to High Technology – LignoSphere Closes Pre-Seed Funding
Stephen Industries and Kiilto Ventures invest in an Aalto University-originated lignin technology company aiming to disrupt the coatings and adhesives market for industry and construction.
Finnish biomaterials company LignoSphere has secured Pre-Seed funding, with Kiilto Ventures and Stephen Industries as lead investors. The investment significantly accelerates the development of LignoSphere’s wood-based biomaterial commercial applications and lays the groundwork for scaling industrial production in the near future.
Can you finally make money from lignin?
For decades, the forest industry has repeated the saying that you can make anything from lignin except money. That saying is now finally beginning to crack. Lignin is a promising raw material, but its chemical complexity has long stood in the way of end products. LignoSphere’s technology solves this challenge by transforming lignin’s structure into uniform spheres — more precisely, colloidal lignin particles that, unlike raw lignin, perform excellently as a key component in numerous chemical compounds.
Lignin is an abundant byproduct of the forest industry: the world’s pulp mills produce approximately 50 million tonnes of lignin annually, of which over 95% is burned for heat. LignoSphere transforms this underutilized biomass into high-value functional materials, with value creation potentially exceeding ten times that of burned lignin per kilogram.
The company’s patented process and applications were developed at Aalto University and Hämeenlinna University of Applied Sciences. The technology enables energy-efficient production of lignin spheres in a closed loop and delivers end products with a significantly lower carbon footprint — at a price that is at least competitive with fossil-based alternatives.
Replacing harmful epoxies – a 100% bio-based alternative
LignoSphere’s lignin sphere-based coatings and adhesives offer a sustainable alternative to widely used fossil-based products. LignoSphere-based coating and adhesive materials bond excellently to metal, concrete, and wood, with highly promising performance in adhesion, wear resistance, and corrosion protection. Adhesive applications have been tested to very high shear strengths (over 10 N/mm²), making them a competitive option in engineered wood products such as glulam manufacturing. End users do not need to significantly change their existing processes — the product behaves like conventional epoxies.
Next steps
With this funding, LignoSphere will accelerate its technology development, expand collaboration with industrial partners and customers, and prepare for the construction of an industrial-scale production facility. The company’s goal is to position lignin-based materials as a credible mainstream alternative to fossil-based chemicals in the global coatings and adhesives markets.
About the investors
Kiilto Ventures is the venture capital arm of Kiilto. Kiilto is a Finnish family-owned company with over a century of history, developing, manufacturing, and selling chemical industry solutions across four business areas: construction, industrial adhesives and fire protection, professional hygiene, and consumer products. Kiilto operates in nine countries and employs nearly 800 people in total. In 2025, the group’s revenue was €217 million.
Stephen Industries is a Finnish family-owned investment company that primarily invests in startup and scaleup companies operating in Finland and across Europe. At the core of the company’s investment strategy are innovative greentech, deeptech, and healthtech companies that contribute to sustainable development and help build a better future.
Both investors bring deep industry expertise that contributes more than capital to LignoSphere’s development: networks, market access, and an understanding of the requirements of the chemical industry.
For more information:
LignoSphere Oy — www.lignosphere.fi
Eero Knuutila, CEO
eero.knuutila@lignosphere.com
Tel. +358 40 839 3899
Kiilto Ventures — www.kiiltoventures.com
Matti Rönkkö, CEO
matti.ronkko@kiilto.com
Stephen Industries Inc Oy— www.stephenindustries.com
Tor-Oskar Karlberg, Investment Director
tor-oskar.karlberg@stephenindustries.com
LignoSphere is a Finnish biomaterials company developing high-value coatings and adhesives from lignin-based nanospheres. The company’s patented technology was developed at Aalto University and Hämeenlinna University of Applied Sciences. LignoSphere is headquartered in Espoo, Finland.