Xenerga, a Florida-based company, announced in a press release this summer that it wants to build biodiesel plants for “average Joes” in Minnesota. But if you’re going to invest in one, Xenerga’s CEO and founder, Jason Sayers, would rather you didn’t actually know much about making biodiesel.
“We have a franchise background, so we’re used to packaging businesses for people to run as a turnkey operation,” says Sayers, who also founded FiltaFry, a U.K.–based chain of franchises that clean and recycle oil from restaurant fryers, about a decade ago. Anyone with technical knowledge about biodiesel production would just be likely to muck things up, trying to “mangle together” their own methods with Xenerga’s, Sayers explains.
And that explains the highly untechnical nature of what you’ll read at Xenerga's Web site: “We use maceration within our pumps to ‘smash’ the ingredients together, then a unique ‘massaging’ mixer unit to further the mix, before finally spinning the mix as it enters the reactor.” And—voilà!—from that, rest assured you’ll get “amongst the highest ‘conversion rates’ [ratio of finished biodiesel to feedstock oil used] within the industry.”
Xenerga has a plant operating in Florida. Sayers says there’ll be three or four start-ups in states including Ohio and Virginia this year, and that in total, there are 23 plants “signed,” meaning investors have committed to back them. But so far, Minnesota remains a blank on Xenerga’s map.
According to Sayers, each plant can expect about $1.8 million in annual net income. Xenerga—in exchange for negotiating deals for its operators on feedstock, helping to hire and train employees, and finding buyers for the finished product—will take a royalty payment on gross profits that Sayers declines to specify. Investors put up $2.5 million for a 5 million gallon plant whose modular design Xenerga can later expand.
And expansion is where Sayers likes to focus the conversation. For now, oil from animal rendering plants and from fryers cleaned by locally based Restaurant Technologies, Inc., are sources of feedstock for Xenerga. But Sayers says his company will eventually offer investors the chance to lock in a price on feedstock oil “for life” from overseas farms raising jatropha plants and algae.
