The firm, based in Y Ffôr near Pwllheli in Gwynedd, is helping to develop the circular economy by identifying materials in what might have been classed as waste in the past, which can be extracted and reused in other products.
Owner and managing director, Dr Jonathan Hughes – whose professional background is in the chemical industry – is now leading his firm into its next stage of development.
It has started the manufacture of its own product, a natural water clarifier extracted from waste shells from seafood processing for use in filter systems for swimming pools and hydrotherapy.
The company has been helped expand with the expert advice and support of Welsh Government's Accelerated Growth Programme (AGP), which looks to provide help to firms wanting to grow.
Dr Hughes established the firm after initially working as a consultant to firms, helping them to innovate before returning to Wales where he started Pennotec. The company had a turnover of £370,000 in 2018 – five times the turnover it had in 2016.
Dr Hughes said the driving force behind his firm is the need to identify new sources of raw materials which are not grounded in petrochemicals. He said: "What we need is a waste stream that is pretty clean and consistent and comes in large volumes.
"We talk to food manufacturers and say this by-product contains these potential products. There is a growing realisation that what was once a waste could in future be a valuable revenue stream for food manufacturers. A good example of this is whey, what was once a waste product from cheese manufacturing is now sold as whey powder to athletes and bodybuilders.
"These are new markets the food manufacturer is not necessarily in and needs support to identify and enter."
The early years of the firm have been grounded in research and development and it has worked with Welsh universities along the way. But now Pennotec is ramping up its next stage of growth as it begins to manufacture its own products.
Dr Hughes said: "We have begun manufacturing and selling natural water purification products derived from crustacean (crab and prawn) shells. We have several similar products in the pipeline, chief amongst them are fat-mimicking functional fibres from fruits and vegetables, particularly surplus, out-graded apples and pomace from juice and cider manufacture."
He added: "We have developed an innovative technology for gently decomposing food waste using industrial biotechnology processes – using fermentation and natural enzymes – in a way that preserves the valuable products in the by-product streams.
"The established commercial technology for obtaining value from food waste is biogas production. This decomposes everything – both valuable materials and low value fats - to carbon dioxide, methane, water and heat. By extracting the valuable products first, we can use wastes more sustainably."
The company was given support from AGP in sales and marketing training, public relations and has also been advised on identifying investors as Pennotec takes its expansion to new levels. Dr Hughes said: "We have had support from AGP in helping employee training and now we are looking to grow, we have been helped in producing an investors' pack to help us get potential investors to invest in our vision."