As global regulations tighten around formaldehyde emissions in composite wood products, with major jurisdictions like the US, European Union, and China mandating reductions by as early as next year, the search for safer, more sustainable alternatives is urgent. At the same time, the plastic waste crisis continues to escalate.
Over 460 million tonnes of plastic are produced each year, with an eye-watering 80% ending up as waste. Of that, around half is polyethylene and polypropylene – two of the most commonly used plastics. Enter NILO, a cleantech start-up based in New Zealand that offers a game-changing solution to these two huge global problems by turning plastic waste into a safe, industrial-grade adhesive for the wood fibreboard industry.
NILO’s proprietary process that repurposes the waste from polyethylene and polypropylene (commonly used for industrial wrapping in construction, agriculture, and hay bales) into a binding agent that is a direct substitute – and vastly safer alternative – to the urea-formaldehyde adhesives that currently dominate wood fibreboard production.
And the technology could revolutionise the industry, offering the seamless integration of a safer and more sustainable option in the wood fibreboard adhesives market, which is valued at $16 billion. Now in the final months of its Series A funding round, NILO’s potential is backed by lead investments from InterIKEA Group and Pacific Channel, who led the start-up’s US$8 million first close in December 2024.
InterIKEA, which first invested in 2023, has extended its commitment to the NILO journey with further investment in the current round as NILO prepares to move into its commercialisation phase.
“This capital injection will enable us to strengthen the team, fine-tune our adhesive formulation, conduct additional industrial trials, and produce larger quantities for potential international clients,” says Tim Williams, NILO’s CEO and founder. Williams brings deep entrepreneurial experience, having successfully exited two ventures before founding NILO. He is joined by CTO Simon Oakley, formerly of Lanzatech, who led the engineering team responsible for building pilot and commercial-scale production plants.
NILO plans to build a commercial demonstration production facility in 2026. As the company evaluates global expansion, regions with established plastic waste sorting infrastructure and fibreboard or adhesive manufacturing capabilities are at the top of the list. Australia has been flagged as a particularly promising candidate.
And whilst there can be little doubt about the commercial viability of NILO’s technology, the company is clear that its purpose extends beyond the bottom line as it strives to bring an end to plastic waste: “As the world’s demand for materials grows, we need to look at sustainable extraction of resources from both new deposits and waste stockpiles,” says Marny Reakes, a NILO board director and former mining industry executive. “NILO is a great example of a company tackling this tough problem with science and technology.”
With mounting legislative pressure, surging demand for sustainable materials and plastic waste reaching crisis point, NILO couldn’t have timed it better. For an industry seeking solutions that are both scalable and sustainable, this Kiwi start-up is definitely one to watch.
