Nonconventional and Vernacular Construction Materials: Characterisation, Properties and Applications [1 ed.] 0081008716, 9780081008713

Nonconventional and Vernacular Construction Materials: Characterisation, Properties and Applications provides a comprehe

1,784 110 24MB

English Pages 514 [432] Year 2016

Report DMCA / Copyright

DOWNLOAD FILE

Polecaj historie

Nonconventional and Vernacular Construction Materials: Characterisation, Properties and Applications [1 ed.]
 0081008716, 9780081008713

Table of contents :
Cover
Related titles
Start-Up Creation: The Smart Eco-efficient
Copyright
Contributors
Woodhead Publishing Series in Civil and Structural Engineering
Foreword
1 - Introduction to start-up creation for the smart ecoefficient built environment
1.1 Sustainability challenges and entrepreneurship for a better world
1.2 Start-ups: creation dynamics and failure stigma
1.3 The importance of start-ups for the smart ecoefficient built environment
1.4 Outline of the book
References
Part One: Business plans, startup financing, and intellectual property
2 - Business plan basics for engineers and new technology firms
2.1 Introduction
2.1.1 What makes business planning for engineers so unique?
2.1.1.1 Uncertainties and risks typical of technological business environments
2.1.1.2 Three primary challenges: financing, sizing markets, and intellectual property management
2.1.1.2.1 The challenge of financing
2.1.1.2.2 The challenge of sizing markets
2.1.1.2.3 The challenge of intellectual property management
2.2 How to approach business planning for engineers?
2.3 Developing and articulating the business model
2.3.1 The three stages of the lean canvas approach
2.3.2 Lean canvas approach metaprinciples
2.3.3 Choosing between the canvas and the business model canvas
2.3.4 The challenges of articulating a unique customer value proposition
2.3.5 Value proposition research insights
2.4 Scaling up the business
2.4.1 Market scaling
2.4.2 Process and team scaling
2.4.3 The danger of getting things wrong
2.4.4 The importance of the difference between growth and scale-up
2.5 A business plan template
2.5.1 A minibusiness plan for investors
2.5.2 The key points in the business plan for the employees
2.6 Conclusion
References
3 - Lean startup
3.1 Introduction
3.1.1 How to be a successful start-up
3.1.2 What is lean in a lean start-up?
3.1.3 The link to the business model idea
3.2 The main elements of lean start-ups
3.2.1 Overview of key elements
3.2.2 Customer feedback
3.2.3 Big design or iterative design—pivot or persevere
3.2.4 Business planning or hypothesis testing
3.3 The fundamental concepts of lean start-ups
3.3.1 Minimum viable products—do we have a problem worth solving?
3.3.2 Pivoting—have we built something people want?
3.3.3 Agile development together with the customers
3.3.4 Searching for a business plan—do we have the right business model?
3.3.5 How to find or create the next customers—scaling
3.4 Some examples of lean processes
3.5 Conclusion and future trends
3.5.1 Lean and global
3.5.2 Further reading and links
Web resources
References
4 - Start-up financing
4.1 Introduction
4.2 Debt financing
4.2.1 Introduction
4.2.2 Pros and cons
4.2.3 Issues
4.3 Equity financing
4.3.1 Introduction
4.3.2 Pros and cons
4.3.3 Key issues
4.4 Convertible debt financing
4.4.1 Introduction
4.4.2 Pros and cons
4.4.3 Key issues
4.5 Crowdfunding
4.5.1 Introduction
4.5.1.1 Donations
4.5.1.2 Rewards
4.5.1.3 Prepurchase
4.5.1.4 Lending
4.5.1.5 Equity crowdfunding
4.5.1.6 Venture philanthropy
4.5.1.7 Initial coin offerings
4.5.2 Pros and cons
4.5.3 Key issues
4.6 Conclusions and future trends
References
Further reading
5 - Intellectual property
5.1 Introduction
5.2 Forms of intellectual property rights
5.2.1 Trademarks
5.2.2 Industrial designs
5.2.3 Patents and utility models
5.2.4 Copyrights
5.2.5 Trade secrets
5.3 Historical development of the intellectual property protection
5.3.1 Patents
5.3.2 Trademarks
5.3.3 Copyrights
5.4 Regulatory aspects of intellectual property protection in the historical perspective
5.4.1 International framework of the protection of intellectual property rights
5.4.2 Intellectual property protection in the European Union
5.5 Intellectual property protection at the crossroads—current perspectives
5.6 Discussion
References
Part Two: Carbon dioxide sequestration materials and technologies
6- CO2 sequestration on cement
6.1 Introduction
6.2 Accelerated carbonation curing of cement compounds
6.2.1 Reaction mechanism of accelerated carbonation curing
6.2.1.1 Carbonation of anhydrous cement constituents
6.2.1.2 Carbonation of hydrated cement compounds
6.2.2 Steps involved in accelerated carbonation curing
6.2.2.1 In-mould curing
6.2.2.2 Preconditioning phase
6.2.2.3 Carbonation phase
6.2.2.4 Postconditioning phase
6.2.3 Laboratory setup of carbonation curing chamber
6.3 Factors affecting CO2 sequestration by accelerated carbonation curing
6.3.1 Effect of CO2 concentration, duration, and pressure of CO2 exposure
6.3.2 Effect of preconditioning on CO2 uptake by accelerated carbonation curing
6.3.3 Effect of material characteristics on CO2 uptake by accelerated carbonation curing
6.4 Performance of carbonation-cured building materials
6.4.1 Performance of cement paste and mortars
6.4.2 Performance of concrete masonry units
6.4.3 Performance of concrete
6.5 Use of supplementary cementitious materials for CO2 footprint reduction and sequestration
6.6 Alternate binders to enhance CO2 sequestration capacity of cement
6.7 Alternate techniques related to carbonation curing
6.8 Challenges for commercial implementation of accelerated carbonation curing
6.9 Areas of further investigation
6.10 Conclusions
References
7 - Carbon dioxide sequestration on mortars containing recycled aggregates: a hot area for startup development
7.1 Introduction
7.2 Experimental program
7.2.1 Materials
7.2.2 Mix design and mortar production
7.3 Results and discussion
7.3.1 Compressive strength
7.3.2 Flexural strength
7.3.3 Resistance to freeze–thaw
7.3.4 Carbon footprint
7.3.5 Cost analysis
7.4 Conclusions
Acknowledgments
References
8 - Carbon sequestration in microalgae photobioreactors building integrated
8.1 Introduction
8.2 Importance of carbon sequestration: reducing CO2 built-up
8.2.1 Why to focus on CO2 concentrations: global warming and cities
8.2.2 CO2 capturing technologies
8.3 CO2 capture by microalgae
8.3.1 Microalgae as a potential tool for CO2 capture
8.3.2 Microalgae production systems: photobioreactors
8.4 Microalgae a green element for a bioactive façade
8.4.1 Bioactive façade systems from plants to microalgae
8.4.2 Photobioreactors: potential tool for a building live environment
8.5 Concluding remarks and future trends
Acknowledgments
References
Part Three: Algorithms, big data and iot for eco-efficient and smart buildings
9 - Affective Internet of Things
9.1 Affective Internet of Things
9.2 IoT, Smart Homes, Ambient Intelligence, and Affective Computing
9.3 BIM, Smart and Interactive Buildings
9.4 Modern office smart systems
Occupancy sensors
Thermal sensors
CO2 sensors
9.5 Affective BIM4Ren
9.5.1 Analysis of patents and systems
9.5.2 Description of the affective BIM4Ren
9.6 Conclusions
Acknowledgments
References
10 - IoT and cloud computing for building energy efficiency
10.1 Introduction
10.2 Literature review
10.2.1 Digitization of the construction industry
10.2.2 Internet of things and cloud computing
10.2.3 Building energy efficiency
10.3 Overview of Internet of things technologies
10.4 Materials and methods
10.4.1 Methodology
10.4.2 Case study
10.4.3 System design
10.5 Analysis
10.6 Conclusions
Acknowledgments
References
11 - Development of algorithms for
11 - Development of algorithms for building energy efficiency
11.1 Introduction
11.1.1 The opportunity
11.1.2 The added value
11.1.3 The product scalability
11.1.4 Chapter structure
11.2 Brief overview of the primary algorithms adopted in building control industry
11.2.1 Classical control principles
11.2.2 Fuzzy logic controllers
11.2.3 Artificial intelligence and genetic algorithms
11.2.4 Deep reinforcement learning
11.2.5 Model-based controllers
11.3 Thermal comfort and energy efficiency
11.3.1 Algorithms
11.3.2 Applications
11.3.2.1 Case study: residential thermostats
11.3.2.2 Case study: commercial buildings
11.4 Power management and enhancing building flexibility
11.4.1 Applications
11.4.1.1 Case study: demand-side management and behind-the-meter energy storage
11.4.1.2 Case study: virtual power plants and demand response
11.5 Conclusions
Abbreviations
References
12 - Understanding the impact of building thermal environments on occupants' comfort and mental workload demand through human ph ...
12.1 Introduction
12.2 Background
12.3 Thermal comfort interpretation through wearable biosensors and polling apps
12.3.1 Main components of the personalized HVAC control framework
12.3.1.1 Indoor sensors and wearable devices
12.3.1.2 Smartphone polling application
12.3.1.3 Database, comfort model, and control script
12.3.1.4 Programmable thermostat
12.3.2 Case study
12.4 Nonintrusive thermal comfort interpretation using infrared thermography
12.4.1 Approaches to collect skin temperature for thermal comfort sensing
12.4.2 Technical approach
12.4.2.1 Low-cost thermal camera
12.4.2.2 Face detection from the thermal image
12.4.3 Data collection experiments
12.4.4 Results and discussions
12.4.4.1 Data cleaning
12.4.4.2 Skin temperature statistics in the experiment
12.4.4.3 Thermal comfort prediction using the extracted features
12.5 Camera network for multioccupancy thermal comfort assessment
12.5.1 Characteristics of the nonintrusive thermal comfort sensing approach
12.5.2 Methodology
12.5.2.1 Thermal and RGB-D dual camera system
12.5.2.2 Kinect face detection
12.5.2.3 Occupant tracking in a single dual camera node
12.5.2.4 Kinect and thermal camera registration
12.5.2.5 Distance calibration of the thermal camera
12.5.2.6 The camera–occupant network
12.5.3 Data cleaning and feature extraction
12.5.4 Experimental setup and protocol
12.5.5 Results and discussion
12.5.5.1 Summary of facial skin temperature features and gender differences
12.5.5.2 Mapping facial mean skin temperature to thermal comfort state
12.6 Evaluation of mental work and performance using electroencephalogram
12.6.1 Conventional methods to evaluate mental workload and performance
12.6.2 Evaluation of mental workload and performance using EEG
12.7 Summary
Acknowledgments
References
Part Four: Smartphone applications for infrastructure monitoring
13 - Structural health monitoring
13.1 Introduction
13.2 Smartphones, crowdsourcing, and modal identification
13.3 Formulation of citizen-induced uncertainties
13.3.1 Identification under spatiotemporal errors
13.3.2 Identification under directional errors
13.3.3 Identification under biomechanical errors
13.4 Cyberphysical system approach to civil infrastructure
13.5 Future trends
Acknowledgments
References
14 - Health monitoring of bridges
14.1 Introduction
14.2 Characterizing bridge response
14.2.1 Bridge response
14.2.2 Sensing systems
14.2.3 Data analysis
14.3 Bridge monitoring with smartphones
14.3.1 Contact sensors
14.3.2 Noncontact sensors
14.3.3 Mobile sensor networks
14.3.4 Summary and discussion
14.4 Case studies
14.4.1 Pedestrian suspension bridge
14.5 Current challenges and future perspectives and directions
Acknowledgments
References
15 - Monitoring urban noise
15.1 Introduction
15.2 Creating noise maps of cities
15.2.1 Measurement procedure for assessment of environmental noise levels
15.2.2 Traditional method—sound level meter measurements
15.2.3 Contemporary method—mobile crowdsensing
15.3 The implementation of mobile crowdsensing
15.3.1 Calibration of used measurement devices
15.3.2 Measurements gathered with mobile crowdsourcing
15.3.3 Results
15.4 The accuracy of the obtained mobile crowdsensing results
15.5 Conclusions
15.6 Future work
15.7. Acknowledgments
References
Index
A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z
Back Cover

Citation preview

Related titles Nonconventional and Vernacular Construction Materials: Characterisation, Properties and Applications (ISBN 978-0-08-100871-3) Biopolymers and Biotech Admixtures for Eco-Efficient Construction Materials (ISBN 978-0-08-100214-8) Acoustic Emission and Related Non-destructive Evaluation Techniques in the Fracture Mechanics of Concrete: Fundamentals and Applications (ISBN 978-1-78242-327-0)

Woodhead Publishing Series in Civil and Structural Engineering

Start-Up Creation The Smart Eco-efficient Built Environment

Second Edition

Edited by

Fernando Pacheco-Torgal Erik Rasmussen Claes-Goran Granqvist Volodymyr Ivanov Arturas Kaklauskas Stephen Makonin

Woodhead Publishing is an imprint of Elsevier The Officers’ Mess Business Centre, Royston Road, Duxford, CB22 4QH, United Kingdom 50 Hampshire Street, 5th Floor, Cambridge, MA 02139, United States The Boulevard, Langford Lane, Kidlington, OX5 1GB, United Kingdom Copyright © 2020 Elsevier Ltd. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage and retrieval system, without permission in writing from the publisher. Details on how to seek permission, further information about the Publisher’s permissions policies and our arrangements with organizations such as the Copyright Clearance Center and the Copyright Licensing Agency, can be found at our website: www.elsevier.com/permissions. This book and the individual contributions contained in it are protected under copyright by the Publisher (other than as may be noted herein). Notices Knowledge and best practice in this field are constantly changing. As new research and experience broaden our understanding, changes in research methods, professional practices, or medical treatment may become necessary. Practitioners and researchers must always rely on their own experience and knowledge in evaluating and using any information, methods, compounds, or experiments described herein. In using such information or methods they should be mindful of their own safety and the safety of others, including parties for whom they have a professional responsibility. To the fullest extent of the law, neither the Publisher nor the authors, contributors, or editors, assume any liability for any injury and/or damage to persons or property as a matter of products liability, negligence or otherwise, or from any use or operation of any methods, products, instructions, or ideas contained in the material herein. Library of Congress Cataloging-in-Publication Data A catalog record for this book is available from the Library of Congress British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library ISBN: 978-0-12-819946-6 For information on all Woodhead Publishing publications visit our website at https://www.elsevier.com/books-and-journals Publisher: Matthew Deans Acquisitions Editor: Gwen Jones Editorial Project Manager: Peter Adamson Production Project Manager: Vignesh Tamil Cover Designer: Alan Studholme Typeset by TNQ Technologies

Contributors

Z. Abdollahnejad Portugal A. Baïri

C-TAC Research Centre, University of Minho, Guimar~aes,

University of Paris, Ville d’Avray, France

Anetta Caplanova Department of Economics, University of Economics in Bratislava, Bratislava, Slovakia Ivan Djurek Department of Electroacoustics, University of Zagreb, Faculty of Electrical Engineering and Computing, Zagreb, Croatia Maria Q. Feng Columbia University, Civil Engineering and Engineering Mechanics, New York, NY, United States Massimo Fiorentini Swiss Federal Laboratories for Materials Science and Technology, EMPA, D€ ubendorf, Switzerland M. Gabilondo

Machine-tool Institute (IMH), Elgoibar, Spain

Shweta Goyal India

Thapar Institute of Engineering and Technology, Patiala, Punjab,

Sanja Grubesa Department of Electroacoustics, University of Zagreb, Faculty of Electrical Engineering and Computing, Zagreb, Croatia Katrine Riber Hansen Product Development and Innovation Program, Department of Technology and Innovation, University of Southern Denmark, Odense M, Denmark A. Kaklauskas Department of Construction Management and Real Estate, Faculty of Civil Engineering, Vilnius Gediminas Technical University, Vilnius, Lithuania Vineet R. Kamat Department of Civil and Environmental Engineering, University of Michigan, Ann Arbor, MI, United States A. Kose

Ege University, Izmir, Turkiye

Rolands Kromanis Department of Construction Management and Engineering, Faculty of Engineering Technology, University of Twente, Enschede, The Netherlands

xii

Contributors

Da Li Glenn Department of Civil Engineering, Clemson University, Clemson, SC, United Staes I. Lill Building Lifecycle Research Group, Department of Civil Engineering and Architecture, Tallinn University of Technology, Tallinn, Estonia A. Martín-Garín ENEDI Research Group, Department of Thermal Engineering, Faculty of Engineering of Gipuzkoa, University of the Basque Country UPV/EHU, Donostia-San Sebastian, Spain M. Mastali

C-TAC Research Centre, University of Minho, Guimar~aes, Portugal

Carol C. Menassa Department of Civil and Environmental Engineering, University of Michigan, Ann Arbor, MI, United States J.A. Mill an-García ENEDI Research Group, Department of Thermal Engineering, Faculty of Engineering of Gipuzkoa, University of the Basque Country UPV/EHU, Donostia-San Sebastian, Spain Michel Noussan

Fondazione Eni Enrico Mattei, Milan, Italy

S.S. Oncel

Ege University, Izmir, Turkiye

D.S. Oncel

Dokuz Eylul University, Izmir, Turkiye

Seth C. Oranburg States

Duquesne University School of Law, Pittsburgh, PA, United

Ekin Ozer University of Strathclyde, Civil and Environmental Engineering, Glasgow, United Kingdom F. Pacheco-Torgal C-TAC Research Centre, University of Minho, Guimar~aes, Portugal; SHRC, University of Sungkyunkwan, Suwon, Republic of Korea Antonio Petosic Department of Electroacoustics, University of Zagreb, Faculty of Electrical Engineering and Computing, Zagreb, Croatia R. Puust Building Lifecycle Research Group, Department of Civil Engineering and Architecture, Tallinn University of Technology, Tallinn, Estonia Erik Stavnsager Rasmussen Department of Marketing & Management, University of Southern Denmark, Odense, Denmark A. Rodríguez Departamento de Construcciones Arquitectonicas e I.C.T., University of Burgos, Burgos, Spain Gianluca Serale Princeton University, Andlinger Center for Energy and the Environment - CHAOS Lab, Princeton, NJ, United States Devender Sharma Punjab, India

Thapar Institute of Engineering and Technology, Patiala,

Contributors

xiii

Mia Suhanek Department of Electroacoustics, University of Zagreb, Faculty of Electrical Engineering and Computing, Zagreb, Croatia Stoyan Tanev Technology Innovation Management Program, Sprott School of Business, Carleton University, Ottawa, ON, Canada I. Ubarte Building Lifecycle Research Group, Department of Civil Engineering and Architecture, Tallinn University of Technology, Tallinn, Estonia Xi Wang Department of Civil and Environmental Engineering, University of Michigan, Ann Arbor, MI, United States

Woodhead Publishing Series in Civil and Structural Engineering

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

Finite element techniques in structural mechanics C. T. F. Ross Finite element programs in structural engineering and continuum mechanics C. T. F. Ross Macro-engineering F. P. Davidson, E. G. Frankl and C. L. Meador Macro-engineering and the earth U. W. Kitzinger and E. G. Frankel Strengthening of reinforced concrete structures Edited by L. C. Hollaway and M. Leeming Analysis of engineering structures B. Bedenik and C. B. Besant Mechanics of solids C. T. F. Ross Plasticity for engineers C. R. Calladine Elastic beams and frames J. D. Renton Introduction to structures W. R. Spillers Applied elasticity J. D. Renton Durability of engineering structures J. Bijen Advanced polymer composites for structural applications in construction Edited by L. C. Hollaway Corrosion in reinforced concrete structures Edited by H. B€ ohni The deformation and processing of structural materials Edited by Z. X. Guo Inspection and monitoring techniques for bridges and civil structures Edited by G. Fu Advanced civil infrastructure materials Edited by H. Wu

xvi

18 19 20 21 22 23 24 25

26 27 28 29 30 31 32 33 34

35

36 37

Woodhead Publishing Series in Civil and Structural Engineering

Analysis and design of plated structures Volume 1: Stability Edited by E. Shanmugam and C. M. Wang Analysis and design of plated structures Volume 2: Dynamics Edited by E. Shanmugam and C. M. Wang Multiscale materials modelling Edited by Z. X. Guo Durability of concrete and cement composites Edited by C. L. Page and M. M. Page Durability of composites for civil structural applications Edited by V. M. Karbhari Design and optimization of metal structures J. Farkas and K. Jarmai Developments in the formulation and reinforcement of concrete Edited by S. Mindess Strengthening and rehabilitation of civil infrastructures using fibre-reinforced polymer (FRP) composites Edited by L. C. Hollaway and J. C. Teng Condition assessment of aged structures Edited by J. K. Paik and R. M. Melchers Sustainability of construction materials J. Khatib Structural dynamics of earthquake engineering S. Rajasekaran Geopolymers: Structures, processing, properties, and industrial applications Edited by J. L. Provis and J. S. J. van Deventer Structural health monitoring of civil infrastructure systems Edited by V. M. Karbhari and F. Ansari Architectural glass to resist seismic and extreme climatic events Edited by R. A. Behr Failure, distress, and repair of concrete structures Edited by N. Delatte Blast protection of civil infrastructures and vehicles using composites Edited by N. Uddin Non-destructive evaluation of reinforced concrete structures Volume 1: Deterioration processes Edited by C. Maierhofer, H.-W. Reinhardt and G. Dobmann Non-destructive evaluation of reinforced concrete structures Volume 2: Non-destructive testing methods Edited by C. Maierhofer, H.-W. Reinhardt and G. Dobmann Service life estimation and extension of civil engineering structures Edited by V. M. Karbhari and L. S. Lee Building decorative materials Edited by Y. Li and S. Ren

Woodhead Publishing Series in Civil and Structural Engineering

38 39 40 41 42 43 44 45 46 47 48 49

50 51

52 53 54 55 56 57

xvii

Building materials in civil engineering Edited by H. Zhang Polymer modified bitumen Edited by T. McNally Understanding the rheology of concrete Edited by N. Roussel Toxicity of building materials Edited by F. Pacheco-Torgal, S. Jalali and A. Fucic Eco-efficient concrete Edited by F. Pacheco-Torgal, S. Jalali, J. Labrincha and V. M. John Nanotechnology in eco-efficient construction Edited by F. Pacheco-Torgal, M. V. Diamanti, A. Nazari and C. Goran-Granqvist Handbook of seismic risk analysis and management of civil infrastructure systems Edited by F. Tesfamariam and K. Goda Developments in fiber-reinforced polymer (FRP) composites for civil engineering Edited by N. Uddin Advanced fibre-reinforced polymer (FRP) composites for structural applications Edited by J. Bai Handbook of recycled concrete and demolition waste Edited by F. Pacheco-Torgal, V. W. Y. Tam, J. A. Labrincha, Y. Ding and J. de Brito Understanding the tensile properties of concrete Edited by J. Weerheijm Eco-efficient construction and building materials: Life cycle assessment (LCA), eco-labelling and case studies Edited by F. Pacheco-Torgal, L. F. Cabeza, J. Labrincha and A. de Magalh~ aes Advanced composites in bridge construction and repair Edited by Y. J. Kim Rehabilitation of metallic civil infrastructure using fiber-reinforced polymer (FRP) composites Edited by V. Karbhari Rehabilitation of pipelines using fiber-reinforced polymer (FRP) composites Edited by V. Karbhari Transport properties of concrete: Measurement and applications P. A. Claisse Handbook of alkali-activated cements, mortars, and concretes F. Pacheco-Torgal, J. A. Labrincha, C. Leonelli, A. Palomo and P. Chindaprasirt Eco-efficient masonry bricks and blocks: Design, properties, and durability F. Pacheco-Torgal, P. B. Lourenço, J. A. Labrincha, S. Kumar and P. Chindaprasirt Advances in asphalt materials: Road and pavement construction Edited by S.-C. Huang and H. Di Benedetto Acoustic emission (AE) and related non-destructive evaluation (NDE) techniques in the fracture mechanics of concrete: Fundamentals and applications Edited by M. Ohtsu

xviii

58

59 60 61 62

63 64 65 66

67

Woodhead Publishing Series in Civil and Structural Engineering

Nonconventional and vernacular construction materials: Characterisation, properties, and applications Edited by K. A. Harries and B. Sharma Science and technology of concrete admixtures Edited by P.-C. Aïtcin and R. J. Flatt Textile fibre composites in civil engineering Edited by T. Triantafillou Corrosion of steel in concrete structures Edited by A. Poursaee Innovative developments of advanced multifunctional nanocomposites in civil and structural engineering Edited by K. J. Loh and S. Nagarajaiah Biopolymers and biotech admixtures for eco-efficient construction materials Edited by F. Pacheco-Torgal, V. Ivanov, N. Karak and H. Jonkers Marine concrete structures: Design, durability, and performance Edited by M. Alexander Recent trends in cold-formed steel construction Edited by C. Yu Start-up creation: The smart eco-efficient built environment Edited by F. Pacheco-Torgal, E. Rasmussen, C.-G. Granqvist, V. Ivanov, A. Kaklauskas and S. Makonin Characteristics and uses of steel slag in building construction I. Barisic, I. Netinger, A. Fucic and S. Bansode

Foreword

Start-up companies are just one, but a valuable way toward progressing innovation so that people in the built environment may have a healthier place to live and work. The barriers to the pathway of innovation are many. For success, there needs to be a fruitful collaboration between academia and industry, but often this also depends on government policies, which can encourage cooperative ventures. Academics need to have entrepreneurship as part of their portfolio, but this needs time and perseverance besides communication skills and some either do not or can see this, as time they need to concentrate on the research. Industry and commercial outlooks toward innovation vary a lot. Some industries are very conservative and tend to think more short term, whereas other sectors take the long-term view. In 15 chapters, this book covers all the range of possibilities that need consideration when contemplating a start-up company besides describing some of the latest innovations, which offer new opportunities for achieving energy-efficient buildings. The best ideas are those that start with a defined focus such as energy efficiency but then bring added value by, for example, improving the human conditions. It is important that academics produce convincing business cases in their proposals for seeking any financial investment. Often, industry tends to look at capital cost, whereas the most innovative ones are more likely to look at the value so balancing the benefits and whole life costs of any proposal. There are lessons to be learnt from forward looking across sectors to the likes of information technology, aeronautics, and pharmaceuticals, for example. Start-up companies need to be lean, adaptable, and open with a wide range of technical and business skills. This book is welcome as it fills a gap in the market for eco-efficient scientists who want to understand how their work can make an impact on the industry. Derek Clements-Croome Professor Emeritus in Architectural Engineering, Reading University, United Kingdom

Introduction to start-up creation for the smart ecoefficient built environment

1

F. Pacheco-Torgal 1, 2 1 C-TAC Research Centre, University of Minho, Guimar~aes, Portugal; 2SHRC, University of Sungkyunkwan, Suwon, Republic of Korea

1.1

Sustainability challenges and entrepreneurship for a better world

About 15 years ago, Meadows et al. (2004) conducted a 30-year update of a wellknown crucial study “The limits to growth” (Meadows et al., 1972), having concluded that period was nothing than a waste of time and that humanity has done very little to avoid the collapse of the Planet’s environment. In 2008, Turner has also studied Meadows projection’s with 30 years of real events, having concluded that the global system is on an unsustainable trajectory unless there is substantial and rapid reduction in consumptive behavior. One year later, Rockstr€om et al. (2009) suggested an innovative approach for global sustainability defining nine interdependent planetary boundaries. They also state that humanity has already transgressed three planetary boundaries for changes to the global nitrogen cycle, rate of biodiversity loss, and above all climate change. Five years later years, Motesharrei et al. (2014) reported on a NASA-funded study that used a mathematical model to show that the overexploitation of natural resources, along with wealth inequality, can precipitate the collapse of civilizations. Khan (2015) explained in very simple words the root of problem: “earthly garbage dump is not free, but the atmospheric dump is treated free! This is because it’s a global commons. So, free-riding remains the norm because of the power of major emitters.” Also in 2015, the United Nations adopted the 2030 Agenda for Sustainable Development, at the heart of which were 17 Sustainable Development Goals that are based on five pillars: people, prosperity, peace, partnership, and planet (UN, 2015). Three years later, Randers et al. (2018) state that the world will not reach all Sustainable Development Goals by 2030, nor even by 2050. Stoknes and Rockstr€ om (2018) also showed a pessimistic view saying that the status quo low ambitious approach is not compatible with the ecologic limits of the Planet. Bendell (2019) recently warned about the probable social collapse: “it is now too late to stop a future collapse of our societies because of climate change, and that we must now explore ways in which to reduce harm”. The problem is that message cannot get trough to common people the same repeated warmings by scientists also had no consequences (Kendall, 2000; Ripple et al., 2017; Cavicchioli

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00001-1 Copyright © 2020 Elsevier Ltd. All rights reserved.

2

Start-Up Creation

et al., 2019). And probably that is why the most recent by dozens of scientists (House, 2019) also decided to endorse the movement Extinction Rebellion. Some optimistics like Hickel et al. (2019) argue that it is still at least theoretically possible to achieve a good life for all within planetary boundaries in poor nations by building on existing exemplary models and by adopting fairer distributive policies. However, the additional biophysical pressure that this entails at a global level requires that rich nations dramatically reduce their biophysical footprints by 40%e50%. Something that for sure will not happen, because, as the physicist Desvaux (2007) has written one decade ago, “Humans will not willingly sacrifice much of their comfortable lifestyles for the greater good (especially for people in other countries) unless it is taken from them.” On September 25, 2019, the IPCC released a worrying report warning about a faster sea level rising (CBS, 2019). However, the article of CBS fails to mention that there was an optimistic report like all the other previous IPCC reports. Ian Dunlop and David Spratt have found that IPCC reports tend toward reticence and caution, erring on the side of ‘least drama’ and downplaying the more extreme and more damaging outcomes (Spratt and Dunlop, 2018). It is rather obvious that IPCC are facing pressure from Governments to avoid releasing projections that may induce panic because panic is bad for business, and to economic growth meaning that it is bad for Governments to get reelected. But since the duty of academia is to the truth (Allot et al., 2019) not to any political agenda it’s understandable why a Professor of Physics at the University of Oxford wrote in a paper published in August of 2019 the following: “Let’s get this on the table right away, without mincing words. With regard to the climate crisis, yes, it’s time to panic” (Pierrehumbert, 2019). No wonder youth movements started to show signs of rebellion against its stolen future (Hope, 2019; Bandura and Cherry, 2019; Hagedorn et al., 2019). Craig and Ruhl (2019) even mentioned that children plaintiffs are arguing to the US Court of Appeals for the Ninth Circuit that the federal government of the United States owes them, constitutionally, a stable climate, which shows that young generations are seeing their future going down the drain. And on September 20, 2019, millions of young people (and others not so young) have taken to the streets (WP, 2019). Still even if we assume that panic is bad for business, the truth is that business still plays an important part in the process because entrepreneurship for climate change could mobilize a lot of energy of young people in developed countries, which is essential in the context of young graduate’s high unemployment rates that are expected to increase in the next decades due to robotization and artificial intelligence. Some projections suggest the number of students enrolled in higher education is forecast to rise from 99.4 million in 2000 to 414.2 million in 2030, an increase of 416% (UNESCO, 2015). Also entrepreneurship for climate change will especially be important for young people in poor countries. Not only because “decent work” is mentioned in the 80 SDG but also because in 2014 when Eric Schmidt and Jared Cohen were, respectively, the Chairman of Google and the Director of Google Ideas, they wrote a book entitled “The New Digital Age: Transforming Nations, Businesses, and Our Lives.” On it, they recalled the fact that the world has hundreds of millions of young people living in miserable conditions that can easily be radicalized to engage in terrorism. In the book, they recall the words of General Stanley McChrystal to the German magazine Der Spiegel when he said that what will defeat terrorism is not

Introduction to start-up creation for the smart ecoefficient built environment

3

military actions but basically two things: the Rule of Law and basic living conditions like education and jobs. Sand (2019) wrote about those “not having a future” because the future is designed by elitist visionaries in rich countries: “a tantalizing confrontation between different visions of the future and subsequently a challenge for policy-making, when pursuing a common future: On the one hand, there is the far-fetched, high-technological vision of space colonization. On the other hand, there is the what seems in contrast to be the somewhat “profane” desire for more job opportunities.” And this constitutes not only an inequality problem but also an ethical one that may increase despair in poor countries. Also a very recent paper by Krieger and Meierrieks (2019) who studied the effect of income inequality on terrorism for a sample of 113 countries showed that it is very important to follow the aforementioned General’s McChrystal advice in order to tackle terrorism. On September of 2019, several drones attacked the Abqaiq facility in Saudi Arabia, the most important oil-processing facility in the world worsening an already unstable world economy (FT, 2019), which shows the consequences of a high entangled world economy addicted to nonrenewable resources located in one of the most unstable regions in the world are especially severe for poor people. Therefore, in this context, entrepreneurship will be very important in order to mobilize the energy of young people in developed countries for a sustainability-based new economy and also to tackle the despair of young people in poor countries, which could end in terrorist actions.

1.2

Start-ups: creation dynamics and failure stigma

According to Lundvall (2017), countries and organizations promoting “experiencebased” knowledge and combining it with science-based knowledge are more innovative than those that only give attention to codified knowledge, meaning that scientific production alone is not enough to unleash the innovation potential and that promoting entrepreneurship and small firms would play a critical role for economic prosperity. Also in the current context of high graduated unemployment rates that will be more dramatic in the next decades (Li et al., 2014; Roy, 2014; Sadler, 2015; Min, 2015), a context in which tacit knowledge formal education is recognized has not being enough (Agarwal and Shah, 2014) start-up creation could become a way to solve this serious problem. The paramount importance of entrepreneurs (and entrepreneurship) for economic development is mainly associated with the theoretical work of Joseph Schumpeter (1934). According to this economist, entrepreneurs are key to for the process of industrial mutation “that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.” For Schumpeter, innovations are disruptions that emanate from a pathological behavior, a social deviance from norms, from daring entrepreneurs (Louç~a, 2014). Start-up creation is the most distinctive feature of the entrepreneurial knowledge-based economy. Start-up creation is especially important in the current knowledge-based economy in which knowledge production

4

Start-Up Creation

is shifting from universities to highly flexible multidisciplinary teams (Hsu et al., 2014). Despite the fact that some still believe that in the next years universities will continue to be the major sources of knowledge generation, the truth is that its (indirect) role on the technology transfer process by providing highly qualified engineers to industry (as they did in the past) will no longer be considered enough. The interactions between universities, government, and industry (triple helix model) are and will be crucial for the development of the knowledge-based economy. Astebro et al. (2012) reviewed three case studies known for their high percentage of student alumni that start new businesses. This included the case of MIT and two others from Swedish universities (Halmstad and Chalmers). These authors state that the MIT is a unique case that is very hard to replicate because it combines an entrepreneurial culture with cutting-edge research and a research budget that exceeds one billion dollars. The MIT exceptionality for spinoff creation was also recently highlighted by Roberts (2014). Astebro et al. (2012) pointed out the success of Chalmers surrogate entrepreneur concept. When a student is chosen/hired specifically to develop the new venture. The reason for that has to do with the fact that the surrogate entrepreneur will add not only new entrepreneurial competence but also new network capability. This concept is based on a three-part division ownership rights. The university is entitled to onethird, the inventor to another third, and the remaining third to the surrogate entrepreneur. Lundqvist (2014) analyzed a total of 170 ventures, 35% were surrogate based. The results show that the surrogate ventures outperformed nonsurrogate ventures both in terms of growth and revenue. The surrogate entrepreneurship concept is therefore a virtuous one because surrogate entrepreneurs will contribute to a more balanced distribution of expertise among the start-up team members, which is known to be a start-up success factor. Teixeira and Coimbra (2014) recently showed that younger start-up members reveal higher levels of entrepreneurial spirit and entrepreneurial capabilities, being in a better position to internationalize earlier than older members. It is worth mentioning that the average start-up member funded by the Silicon Valley Y Combinator is around 29 years old. Still much more efforts are needed to bridge the gap between research and the entrepreneurial world (Stagars, 2014) in order to foster massive start-up creation. van Wilgenburg et al. (2019) recently showed that scientific output, patent activity, venture capital companies, clinical investigators, and entrepreneurship all have a significant influence on the number of start-ups per country in the field of biomed. However, those authors found that “when taking all relationships into account using the MVA analysis, it appears that scientific output is the key determinant of start-up success”. Argyropoulou et al. (2019) reviewed the European Paradox (Europe lacking the entrepreneurial capacity of the United States to transform the research excellence into innovation, growth, wealth, and jobs) and remembered the important coexistence of seven actors that are indispensable for bringing innovations to the market: competent and active customers, innovators, entrepreneurs, skilled labor, competent venture capitalists, exit markets, and industrialists. Since start-ups have an extremely high failure rate, an interesting fact is that the lack of funding is not the first cause of failure. A survey of several hundred failures showed that in 42% of the cases, the reason was the fact that the produce/service did not target a real “market need.” Ran out of cash and team

Introduction to start-up creation for the smart ecoefficient built environment

5

problems rank the second and third in 29% and 23% of the cases (CB Insigths, 2018). Still on start-up failure, one important issue concerns failure stigma, which occurs when society views failure has a proof of the entrepreneur inability to deliver successful results, which is basically the same as expecting that every time Cristiano Ronaldo quicks, the ball the result is always a goal. Several authors claim that different cultural backgrounds in different countries help to explain how different countries have different views on the issue when compared to the American mantra “fail fast, fail often.” Wilcock (2016) stated that in the United States, start-ups fail fast and the founders move on to the next opportunity, an experience considered to be positive by investors, while in the United Kingdom, a failed start-up can be a millstone around an entrepreneur’s neck as they try to raise funds for future ventures. Matthias (2018) compared media reporting about failure of start-ups in Germany and the United States, noticing that US media reports more positively about failed start-ups, than the German media does. This is also confirmed by Gellman (2018), which may help to explain why in Germany entrepreneurship and disruptive innovation are consistently low, whereas the United States performs very well in these areas (Richter et al., 2018). Holland (2018) mentioned that many people who try to start businesses in Australia cannot stand the thought of failing. The same is for most Asian cultures. Peretz Lavie, the President of Technion, mentioned that his country has almost the same approach as the United States (Lavie, 2019), reporting cases of Technion students who were only successful on their 10th attempt. Nahata (2019) noticed that in countries that value experience (successful or not), previously unsuccessful serial entrepreneurs receive better deal terms than novice founders, consistent with entrepreneurial learning being an important factor in fostering future entrepreneurship. Corner et al. (2017) did not find resilience problems after venture failure, of course this must be viewed in the light of New Zealand culture because Mehwish (2018) states that resilience plays a crucial role in reentry to business and future venture success. Quek (2019) mentioned a study that shame prevents founders from openly sharing their problems, and this can be a vicious circle that further perpetuates a culture where no one wants to talk about failure and the shame associated with it becomes worse. And that is why recently some events were created, such has FailCon or Fuckup Nights, to tackle this problem. However, Funken (2018) advises that some caution must be used to avoid excessive celebration of failures suggesting an error-handling strategy.

1.3

The importance of start-ups for the smart ecoefficient built environment

Still on the innovation philia that is probably the most common feature of start-ups, it is worth remembering the words of an emeritus professor of economics at Stanford University who called the pathological impulse to push the rate of innovation to be ever faster needs a medical psychiatric designation, which could be termed the “Imelda Marcos syndrome” (Soete, 2019). That is the case of “innovation in consumer goods

6

Start-Up Creation

that induce customers to migrate continuously to newer models include new product design, electronic goods manufacturers ceasing to supply essential after-sales services or spare parts for older or even the case Apple planned obsolescence of the battery life” (Soete, 2019). But is for sure note the case of innovation in field of smart ecoefficient built environment which is a subfield of civil engineering. Civil engineering is known as an area mainly concerned with directing the great sources of power in nature for the use and convenience of man through the construction of large and public infrastructures (bridges, dams, airports, highways, tunnels, etc.) by large construction companies. Civil engineering has an important role to play, given the environmental impacts of the construction industry that will be exacerbated in the next decades due to the growth in world population, especially urban population that will almost double until 2050, increasing from approximately 3.4 billion in 2009 to 6.4 billion in 2050. Not surprisingly, estimates on urban expansion suggest that until 2030 a high probability exists (over 75%) that urban land cover will increase by 1.2 million km2 (Seto et al., 2012). This is roughly an area equivalent in size to 20,000 American football fields every day (United Nations, 2018). Since the global construction industry consumes more raw materials (about 3000 Mt/year, almost 50% by weight) than any other economic activity, the previously mentioned urban expansion will dramatically increase that consumption (Ashby, 2015) and produce approximately 2 billion tons of waste per year (Seto et al., 2014) and about 75% of carbon emissions from global final energy use this not only will make it more difficult to reduce greenhouse gas emissions but will also put increase pressure on biodiversity loss which is crucial for humanity survival (Cavicchioli et al., 2019). It is rather obvious that in the next decades, the built environment will have worry on many climatic changeerelated events like sea level rise, sudden flooding, cyclones, and extreme heat waves. Be there as it may by redirecting the focus of civil engineering from construction and rehabilitation of grand infrastructures to smart ecoefficient built environment related areas and the needs of individual home users will enlarge the number of future clients. Different user problems will require different tailored solutions, and this may represent a wide market of millions of clients who may foster high-tech start-up creation. A field related to the sustainability of the built environment where start-ups may have started to gain some traction concerns carbon sequestration. It is worth remembering that 5 years ago, Amoureux et al. (2014) already have suggested that carbon dioxide should be seen as a commodity that could serve as basis for a new economic industry. Germany initiated as one of the first nations in the world a major research program in carbon dioxide capture and utilization, and between 2010 and 2016, approximately 100 million Euros have been granted for 33 collaborative research and development projects, consisting of more than 150 individual projects (Mennicken et al., 2016). The flagship programme EnCO2re, one of the five Climate-KICs, which started in 2014 with public launch in 2016, currently looks to develop new technologies offering novel ways to use CO2; increase awareness for CO2 re-use; and ensure sustainability and social acceptance of materials and products by integrated socioecological research. This programme is led by Covestro AG (formerly Bayer MaterialScience AG) working with other Climate-KIC companies and university/research partners from several countries including Denmark, Sweden, the United Kingdom, France,

Introduction to start-up creation for the smart ecoefficient built environment

7

and the Netherlands. A McKinsey & Company report estimates that carbon productsdespecially in concrete, plastics, fuel, and carbon fiberdcould be a market worth between $800 billion US and $1.1 trillion US by 2030 (Global CO2, 2016). XPRIZE Foundation, designed to accelerate new technologies by converting CO2 emissions from industrial facilities into valuable and useable products, has created the US$20 million NRG COSIA Carbon XPRIZE. The competition is structured as a two-track prize, with the new technologies tested at either a coal power plant or a natural gas power plant (COSIA, 2017). It is also worth mentioning the case of the start-up “Carbon8 Aggregates,” whose technology combines carbon dioxide with waste residues from municipal incinerators and energy plants to form calcium carbonate (Carbon8, 2017). Another carbon sequestration possibility encompasses using carbon dioxide generated by heavy industry to cultivate microalgae that can then be used to produce feedstock for animals and even food for humans. Photosynthetic microalgae use sunlight as their energy, water as their electron source, and CO2 as carbon source. Contrary to other biofuels sources, microalgae have a high oil content and most importantly show an extremely rapid growth. It doubles their biomass within 24 h being the fastest growing organisms in the world. In addition its potential as CO2 abating technology will also increase its costeefficiency relation. The production of 1 ton of algae biomass results in avoiding 0.5 tons of CO2 (Koller et al., 2015). Recently, it was reported that an Estonian start-up was using microscopic algae to turn CO2 into valuable products with a technology designed to cultivate microalgae right through the harsh winters of Northern Europe, when daylight is in short supply and temperatures are generally below freezing (Pringle, 2019). Recently, carbon capture and sequestration was considered 1 of the 100 Radical Innovation Breakthroughs for the future (EC, 2019). Of course, the report suggested that carbon prices may need to rise three to six times as much to spur the adoption of carbon capture and other innovative technologies. That is the same opinion of Nobel laureate William D. Nordhaus (2017) who suggested a carbon tax as an important way to reduce emissions cost-effectively and also to strengthen incentives for research and development of technologies that will lower the cost of reducing emissions. Be there as it may, the truth is that start-ups on carbon sequestration are already getting massive funding (MIT, 2019). Another important area that may unleash a lot of business opportunities for start-ups concerns the Smart Built Environment. This includes mostly smart homes but more recently also other smart features for infrastructure monitoring. The investigation on smart homes begun in 90s with the MIT pioneering work “Smart rooms” (Pentland, 1996). De Silva et al. (2012) defined it as “home-like environment that possesses ambient intelligence and automatic control, which allow it to respond to the behavior of residents and provide them with various facilities.” They also mention that currently there are three major application categories. The first category aims at providing services to the residents and includes smart homes that provide eldercare, smart homes that provide healthcare, and smart homes that provide childcare. The second category aimed at storing and retrieving of multimedia captured within the smart home, in different levels from photos to experiences, and the third is about surveillance, where the data captured in the environment are processed to obtain information that can help to raise alarms, in order to

8

Start-Up Creation

protect the home and the residents from burglaries, theft, and natural disasters like flood, etc. The concept “smart buildings” has been associated with a more recent and advanced grouping that integrates and accounts for intelligence, enterprise, control, and materials and construction as an entire building system, with adaptability, not reactivity, at its core, in order to meet the drivers for building progression: energy and efficiency, longevity, and comfort and satisfaction. Apart from the discussion between the intelligent/smart/sentient concepts, it is important to retain that the overall objective relies on the development of housing to be healthier, safer, and comfortable. In the next years, three major disruptive drivers (big data/Internet of Things (IoT)/cloud computing) will radically change smart homes. The data generated from thousands of home sensors and home appliances that are able to connect to each other, to the send data, and to be managed from cloud networks services will boost smart homes advantages (Kirkham et al., 2014). Thanks to IoT, the largest software companies will make a shift to the physical world as did Google that recently acquired a company producing thermostats to enter its trademarks in the smart home world (Borgia, 2014). This highlights the importance of building energy efficiency. An importance that is also shared by some works on the IoT area (Moreno et al., 2014) and which is special needs to address ambitious energy consumption targets like for instance the Z€ urich 2000 Watt Society. More on the role of energyefficient built environment to European smart cities can be found in Kylili and Fokaides (2015). Smart homes will be able to assess occupant’s satisfaction, which is one of the main shortcomings of built environment. Even in green buildings that surprisingly are not so occupant friendly as previously alleged. In a postoccupancy study of a LEED Platinum building, some occupants mentioned thermal discomfort (Hua et al., 2014). The assessment of the occupant’s feedback in smart homes will trigger interactive actions to adapt homes performance accordingly. This leap is from neutral comfort (absence of discomfort) into a new one in which the wellbeing of occupants is at the heart of the smart home concept. Also older people constitute an important group of users with special needs that could benefit from smart homes features. Besides, in the next decades, this group will increase dramatically. The global population of people over the age of 65 is expected to more than double from 375 million in 1990 to 761 million by 2025, and by 2040, it is expected to reach 1300 million. Between 2100 and 2300, the proportion of the world population in the 65 or over age group (the retirement age in most countries) is estimated to increase by 24%e32%, and the 80 or over age group will double from 8.5% to 17%. Some studies found out that elderly people would prefer to live in their own house rather than in hospitals, which means that is important that homes can be studied and adapted to enhance elderly user’s satisfaction. For instance, home sensors can be used to detect air pollutants like volatile organic compounds (VOC) and trigger ventilation to reduce its concentration. They can also be used to balance daylight exposure and artificial light in order to guarantee enough light to maintain circadian rhythmicity or else to warn elderly occupants on heat waves and high UV exposure. More importantly, the sensors of the networked infrastructure in smart cities collect enormous data, which are then available for entrepreneurs to make use of them in new and innovative ways (Kummitha, 2019). In this context, the deployment of smartphones for

Introduction to start-up creation for the smart ecoefficient built environment

9

civil engineering has been gaining traction for monitoring several infrastructure systems (Alavi and Buttlar, 2019). This is because smartphones are equipped with various low cost smart sensors such as accelerometers, global positioning system, gyroscopes, and cameras along with on-board storage, computing, and communication capabilities and thus can become an intelligent, scalable, autonomous, and low-cost component of the next generation civil infrastructure monitoring systems (bridges, highways, environmental noise, etc) in smart cities. Lastly, it is important to emphasize that since smart cities are able to put together talent, knowledge, and capital, they are especially dedicated to support entrepreneurs (Florida et al., 2020) as long as they remember that the interests of citizens must not be forgotten (Engelbert et al., 2019).

1.4

Outline of the book

This book provides an updated state-of-the-art review on the start-up creation for the Smart Built Environment. The first part encompasses an overview on business plans, start-up financing, and intellectual property (Chapters 2e5). Chapter 2 focuses on the nature of business-planning activities from an engineering entrepreneurial perspective. After discussing the unique characteristics and challenges of technology-driven business environments, which are typically the business playground for engineering professionals, the chapter focuses on describing the two key components of the business planning process. Chapter 3 addresses the concept of the Lean Startup approach as a way of reducing the risk and enhancing the chances for success by validating the products and services in the market with customers before launching it in full scale. The main point is to develop a minimum viable product that can be tested by potential customers and then pivot the idea if necessary around these customer evaluations. Chapter 4 discusses the pro and cons of different start-up financing options. Stock investors collect repayment only when the start-up is acquired or goes public, but entrepreneurs cede some control of the start-up to stockholders. Hybrid options like convertible debt provide a temporary solution to some financing problems. Chapter 5 provides an overview of different forms of intellectual property and of the ways it is protected at global, regional, and national levels. It discusses the development of the intellectual property right protection in different historical and geographical contexts. International regulatory framework of intellectual property right protection is discussed with the special focus on Europe and on the European Union. The impact of current technological developments on the intellectual property protection is addressed. Carbon sequestration technologies for ecoefficient buildings are the subject of Part II (Chapters 6e8). Chapter 6 discusses in detail possibility of CO2 sequestration by cement-based materials through accelerated carbonation curing. Reaction mechanisms, laboratory processes, and resulting performance of carbonation curing have been comprehensively

10

Start-Up Creation

discussed and reviewed based on available literature. The chapter also discusses challenges faced by ACC for industrial implementation and future scope of research on carbonation curing. Chapter 7 discloses results of an investigation concerning the carbon sequestration performance of fly ash/waste glass alkaline-based mortars with recycled aggregates reinforced by hemp fibers. Chapter 8 highlights the potential of photobioreactor façades through the microalgae and built environment interaction from a biosymbiotic perspective comprising the technical background on biochemistry, design, and application. The third part encompasses algorithms, big data, and IoT for smart buildings (Chapters 9e12). Chapter 9 analyzes the Affective IoT, smart homes, ambient intelligence, affective computing, BIM, smart and interactive buildings, and smart building systems. There is also a description of the affective BIM4Ren, which is currently under development by the authors of this chapter. Chapter 10 is concerned with the implementation in a case study of a cost-effective, low-power, and long-range IoT device for real-time monitoring. Due to the great impact that air leakages have on buildings energy demand, this variable has been taken as object of monitoring. Chapter 11 investigates the opportunity covered by innovative algorithms to enhance buildings’ energy efficiency and occupants’ comfort. This chapter covers an exhaustive overview of the current development trends, analyzing both the relevant scientific literature and the commercialized solutions currently available on the market. In Chapter 12, several key limitations in existing approaches of thermal comfort sensing are discussed, such as lacking actionable human data in comfort prediction, intrusiveness, and privacy concerns resulted from conventional data collection methods. The chapter summarizes recent research whereby human physiological data are collected from wearable devices (e.g., smart watches and electroencephalogram headset) and infrared thermal cameras. Finally the fourth part (Chapters 13e15) deals with smartphone applications for infrastructure monitoring algorithms. Chapter 13 introduces the advent of smartphones as an SHM technology and describes crowd/citizen engagement into an SHM framework. The chapter concludes with the state-of-the-art vision for smartphone usage in SHM, near future trends, and finally long-term research directions. Chapter 14 reviews smartphone applications for bridge monitoring and data analysis in laboratory environments and in situ. A case study presenting a shortterm monitoring of a suspension bridge is included to demonstrate capabilities of smartphones collecting ultrahigh videos, from which accurate dynamic response is derived. Chapter 15 offers an overview of several methods designed to monitor noise pollution in urban areas, taking advantage of the increasing popularity of smartphones and advancement of their technological capabilities, thus, using the mobile crowdsensing method, to create cities’ noise maps in a more easy and intuitive way.

Introduction to start-up creation for the smart ecoefficient built environment

11

References Agarwal, R., Shah, S., 2014. Knowledge sources of entrepreneurship: firm formation by academic, user and employee innovators. Research Policy 43, 1109e1133. Alavi, A.H., Buttlar, W.G., 2019. An overview of smartphone technology for citizen-centered, real-time and scalable civil infrastructure monitoring. Future Generation Computer Systems 93, 651e672. Allott, N., Knight, C., Smith, N., Chomsky, N. (Eds.), 2019. The Responsibility of Intellectuals: Reflections by Noam Chomsky and Others 50 Years. UCL Press. Amoureux, J., Siffert, P., Massue, J.P., Cavadias, S., Trujillo, B., Hashimoto, K., Rutberg, P., Dresvin, S., Wang, X., 2014. Carbon dioxide: a new material for energy storage. Progress in Natural Science: Materials International 24, 295e304. Argyropoulou, M., Soderquist, K.E., Ioannou, G., 2019. Getting out of the European Paradox trap: making European research agile and challenge driven. European Management Journal 37 (1), 1e5. Ashby, F., 2015. Materials and Sustainable Development, first ed. Butterworth-Heinemann, Elsevier, Oxford, UK. Astebro, T., Bazzazian, N., Braguinsky, S., 2012. Startups by recent university graduates and their faculty: implications for university entrepreneurship policy. Research Policy 41, 663e677. Bandura, A., Cherry, L., 2019. Enlisting the power of youth for climate change. American Psychologist. https://doi.org.10.1037/amp0000512. Bendell, J., 2019. Because it’s not a drill: technologies for deep adaptation to climate chaos. In: Connect University Conference on Climate Change, 13 May 2019. DG Connect, European Commission, Brussels, Belgium. http://insight.cumbria.ac.uk/id/eprint/4776/. Borgia, E., 2014. The Internet of Things vision: key features, applications and open issues. Computer Communications 54, 1e31. Carbon8, 2017. http://c8a.co.uk/. Cavicchioli, R., Ripple, W.J., Timmis, K.N., Azam, F., Bakken, L.R., Baylis, M., Behrenfeld, M.J., Boetius, A., Boyd, P.W., Classen, A.T., Crowther, T.W., 2019. Scientists’ warning to humanity: microorganisms and climate change. Nature Reviews Microbiology 1. CB Insigths, 2018. The Top 20 Reasons Startup Fails. https://www.cbinsights.com/research/ startup-failure-reasons-top/. CBS, 2019. Climate Change Report Warns Oceans Warming and Rising Faster, Putting Lives at Risk. https://www.cbsnews.com/news/climate-change-un-ipcc-report-today-oceanswarming-rising-faster-tipping-points-severe-weather-2019-09-25/. Corner, P.D., Singh, S., Pavlovich, K., 2017. Entrepreneurial resilience and venture failure. International Small Business Journal 35 (6), 687e708. COSIA, 2017. http://www.cosia.ca/carbon-xprize/about. Craig, R.K., Ruhl, J.B., 2019. New realities require new priorities: rethinking sustainable development goals in the anthropocene. In: Owley, J., Hirokawa, K. (Eds.), Environmental Law Beyond 2020, Forthcoming; University of Utah College of Law Research Paper No. 319. Available at: https://ssrn.com/abstract¼3401301 or https://doi.org/10.2139/ssrn. 3401301. De Silva, L., Morikawa, C., Petra, I., 2012. State of the art of smart homes. Engineering Applications of Artificial Intelligence 25, 1313e1321.

12

Start-Up Creation

Desvaux, M., 2007. The sustainability of human populations: how many people can live on earth? Significance 4 (3), 102e107. EC, 2019. Recently Carbon Capture and Sequestration Was Considered One of the 100 Radical Innovation Breakthroughs for the Future. https://ec.europa.eu/info/sites/info/files/research_ and_innovation/knowledge_publications_tools_and_data/documents/ec_rtd_radicalinnovation-breakthrough_052019.pdf. Engelbert, J., van Zoonen, L., Hirzalla, F., 2019. Excluding citizens from the European smart city: the discourse practices of pursuing and granting smartness. Technological Forecasting and Social Change 142, 347e353. Florida, R., Adler, P., King, K., Mellander, C., 2020. The city as startup machine: the urban underpinnings of modern entrepreneurship. In: Urban Studies and Entrepreneurship. Springer, Cham, pp. 19e30. F.T., 2019. Saudi oil attack highlights Middle East’s drone. https://www.ft.com/content/ f2a73b40-d920-11e9-8f9b-77216ebe1f17. Funken, R., 2018. When the Going Gets Tough-How Entrepreneurs Learn from Problems and Failures. School of Economy, (Ph.D. thesis). Leuphana University of L€ uneburg. Gellman, R., 2018. German Start-Ups Learn to Fail. http://nymag.com/developing/2018/10/ germany-berlin-tech-startups-mimic-silicon-valley-and-learn-to-fail.html. Global CO, 2016. https://www.globalco2initiative.org/. Hagedorn, G., Kalmus, P., Mann, M., Vicca, S., Van den Berge, J., van Ypersele, J.P., Bourg, D., Rotmans, J., Kaaronen, R., Rahmstorf, S., Kromp-Kolb, H., 2019. Concerns of young protesters are justified. Science 364 (6436), 139e140. Hickel, J., 2019. Is it possible to achieve a good life for all within planetary boundaries? Third World Quarterly 40 (1), 18e35. Holland, G., 2018. Why Founders Shouldn’t Be Ashamed about a Failed Business. https://www. startupdaily.net/2018/02/why-you-shouldnt-be-ashamed-about-having-a-failed-business/. Hope, M., 2019. Contagious youth. The Lancet Planetary Health 3 (9), e376ee377. House, R., 2019. Act now to prevent an environmental catastrophe. Psychotherapy and Politics International 17 (1), e1484. Hsu, A., Shen, Y.-C., Yuan, B., Chou, C., 2014. Toward successful commercialization of university technology: performance drivers of university technology transfer in Taiwan. Technological Forecasting and Social Change 92, 25e39. Hua, Y., Goçer, O., Gocer, K., 2014. Spatial mapping of occupant satisfaction and indoorenvironment quality in a LEED platinum campus building. Building and Environment 79, 124e137. Kendall, H.W., 2000. Press release: announcing world scientists’ warning to humanity. In: A Distant Light. Springer, New York, NY, pp. 193e197. Khan, M., 2015. Polluter-pays-principle: the cardinal instrument for addressing climate change. Laws 4 (3), 638e653. Kirkham, T., Armstrong, D., Djemame, K., Jiang, M., 2014. Risk driven Smart Home resource management using cloud services. Future Generation Computer Systems 38, 13e22. Koller, M., Salerno, A., Braunegg, G., 2015. Value-added products from algal biomass. In: Perosa, A., Bordignon, G., Ravagnan, G., Zinoviev, S.P. (Eds.), Algae as Potential Source of Food and Energy in Developing Countries: Sustainability, Technology and Selected Case Studies, pp. 19e30. Krieger, T., Meierrieks, D., 2019. Income inequality, redistribution and domestic terrorism. World Development 116, 125e136. Kummitha, R.K.R., 2019. Smart cities and entrepreneurship: an agenda for future research. Technological Forecasting and Social Change 149, 119763.

Introduction to start-up creation for the smart ecoefficient built environment

13

Kylili, A., Fokaides, P., 2015. European smart cities: the role of zero energy buildings. Sustainable Cities and Society 15, 86e95. Lavie, P., 2019. You Must Be Optimistic to Live in This Part of the World. https:// sciencebusiness.net/news/you-must-be-optimistic-live-part-world. Li, S., Whalley, J., Xing, C., 2014. China’s higher education expansion and unemployment of college graduates. China Economic Review 30, 567e582. Louç~a, F., 2014. The elusive concept of innovation for Schumpeter, Marschak and the early econometricians. Research Policy 43, 1442e1449. Lundqvist, M., 2014. The importance of surrogate entrepreneurship for incubated Swedish technology ventures. Technovation 34, 93e100. Lundvall, B.Å., 2017. Is there a technological fix for the current global stagnation?: a response to Daniele Archibugi, Blade Runner economics: will innovation lead the economic recovery? Research Policy 46 (3), 544e549. Matthias, J., 2018. Media Judgment of Entrepreneurial Failure e Implications for Founders. https://tore.tuhh.de/handle/11420/1633. Meadows, D.L., Meadows, D.H., Behrene, J.R.W., 1972. The Limits to Growth. MIT Press. Meadows, D.H., Randers, J., Meadows, D.L., 2004. The Limits to Growth: The 30-Year Update. Routledge. Mehwish, H., 2018. The Contribution of Entrepreneurial Learning Resilience and Recovery to Venture Success after Failures: Two Case Study Examples. Mennicken, L., Janz, A., Roth, S., 2016. The German R&D program for CO2. Environmental Science and Pollution Research 23 (11), 11386e11392. Min, W., 2015. The challenge facing Chinese higher education in the next two decades. International Higher Education 80, 11e12. MIT, 2019. Startups on Carbon Sequestration Are Getting Massive Funding. https://www. technologyreview.com/s/613447/startups-looking-to-suck-c02-from-the-air-are-suddenlyluring-big-bucks/.  Moreno, M.V., Ubeda, B., Skarmeta, A., Zamora, M., 2014. How can we tackle energy efficiency in IoT based smart buildings? Sensors 14, 9582e9614. Motesharrei, S., Rivas, J., Kalnay, E., 2014. Human and nature dynamics (HANDY): modeling inequality and use of resources in the collapse or sustainability of societies. Ecological Economics 101, 90e102. Nahata, R., 2019. Success is good but failure is not so bad either: serial entrepreneurs and venture capital contracting. Journal of Corporate Finance 58, 624e649. Nordhaus, W.D., 2017. Revisiting the social cost of carbon. Proceedings of the National Academy of Sciences of the United States of America 114 (7), 1518e1523. Pentland, A., 1996. Smart rooms. Scientific American 54e62. Pierrehumbert, R., 2019. There is no Plan B for dealing with the climate crisis. Bulletin of the Atomic Scientists 1e7. Pringle, 2019. The New Algae Alchemists. Science Business. https://sciencebusiness.net/newalgae-alchemists. Quek, C., 2019. The shame faced by Singapore startup founders who fail is real. In: Here’s what We Can Do. https://www.todayonline.com/commentary/shame-faced-singapore-startupfounders-who-fail-real-heres-what-we-can-do. Richter, N., Jackson, P., Schildhauer, T., 2018. Entrepreneurial behaviour and startups: the case of Germany and the USA. In: Entrepreneurial Innovation and Leadership. Palgrave Pivot, Cham, pp. 1e14.

14

Start-Up Creation

Ripple, W.J., Wolf, C., Newsome, T.M., Galetti, M., Alamgir, M., Crist, E., Mahmoud, M.I., Laurance, W.F., 15,364 Scientist Signatories From 184 Countries, 2017. World scientists’ warning to humanity: a second notice. BioScience 67 (12), 1026e1028. Roberts, E., 2014. Foreword. In: Allen, T., OShea, R. (Eds.), Building Technology Transfer within Research Universities: An Entrepreneurial Approach. Cambridge University Press. Rockstr€om, J., Steffen, W., Noone, K., Persson, Å., Chapin III, F.S., Lambin, E., Lenton, T.M., Scheffer, M., Folke, C., Schellnhuber, H., Nykvist, B., De Wit, C.A., Hughes, T., van der Leeuw, S., Rodhe, H., S€orlin, S., Snyder, P.K., Costanza, R., Svedin, U., Falkenmark, M., Karlberg, L., Corell, R.W., Fabry, V.J., Hansen, J., Walker, B., Liverman, D., Richardson, K., Crutzen, P., Foley, J., 2009. Planetary boundaries:exploring the safe operating space for humanity. Ecology and Society 14 (2), 32. Roy, S., 2014. Reengineering our vision: breaking through the paradoxical crisis of unemployment. International Journal of Human Resource Management 1, 11e17. Sadler, D., 2015. The Challenges Facing Chinese Higher Education. And Why They Matter. The Observatory of Borderless Higher Education. Sand, M., 2019. On “not having a future”. Futures 107, 98e106. Schmidt, E., Cohen, J., 2014. The New Digital Age: Transforming Nations, Businesses, and Our Lives. Vintage. Schumpeter, J., 1934. The Theory of Economic Development (R. Opie, Trans.). Harvard University Press, Cambridge. Seto, K.C., Buneralp, B., Hutyra, L.R., 2012. Global forecasts of urban expansion to 2030 and impacts on biodiversity and carbon pools. Proceedings of the National Academy of Sciences of the United States of America 17e21. Seto, K., Shobhakar, D., Bigio, A., Blanco, H., Delgado, G.C., Dewar, D., Huang, L., Inaba, A., Kansal, A., Lwasa, S., McMahon, J., M€uller, D., Murakami, J., Nagrenda, H., Ramaswami, A., 2014. Human settlements, infrastructure, and spatial planning, climate change 2014: mitigation of climate change. In: Contribution of Working Group III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. https:// doi.org/10.1017/CBO9781107415416.018. Soete, L., 2019. From “destructive creation” to “creative destruction”: Rethinking Science, Technology and innovation in a global context. The UNU-MERIT WORKING Paper Series. Spratt, D., Dunlop, I., 2018. What Lies beneath: The Understatement of Existential Climate Risk. Published by Breakthrough, National Centre for Climate Restoration, Melbourne, Australia. Stoknes, P.E., Rockstr€om, J., 2018. Redefining green growth within planetary boundaries. Energy Research & Social Science 44, 41e49. Stagars, M., 2014. University Startups and Spinoffs. Guide for Entrepreneurs in Academia. Springer. Teixeira, A., Coimbra, C., 2014. The determinants of the internationalization of Portuguese university spin-offs: an empirical investigation. Journal of International Entrepreneurship 12, 270e308. Turner, G.M., 2008. A comparison of The Limits to Growth with 30 years of reality. Global Environmental Change 18 (3), 397e411. UN, 2015. United Nations, Sustainable Development Goals. https://sustainabledevelopment.un. org/?menu¼1300. UNESCO, 2015. https://iite.unesco.org/files/news/639206/Paris%20Message%2013%2007% 202015%20Final.pdf. United Nations, 2018. World Urbanization Prospects: The 2018 Revision, pp. 1e2.

Introduction to start-up creation for the smart ecoefficient built environment

15

van Wilgenburg, B., van Wilgenburg, K., Paisner, K., van Deventer, S., Rooswinkel, R.W., 2019. Mapping the European startup landscape. Nature biotechnology 37 (4), 345. Wilcock, R., 2016. Why Fast Failures Make US Startups a Better Bet than Those in the UK. http://theconversation.com/why-fast-failures-make-us-startups-a-better-bet-than-those-inthe-uk-53067. WP, 2019. ‘We Will Make Them Hear Us’: Millions of Youths Around the World Strike for Action. https://www.washingtonpost.com/climate-environment/2019/09/20/millions-youtharound-world-are-striking-friday-climate-action/.

Business plan basics for engineers and new technology firms

2

Stoyan Tanev 1 , Erik Stavnsager Rasmussen 2 , Katrine Riber Hansen 3 1 Technology Innovation Management Program, Sprott School of Business, Carleton University, Ottawa, ON, Canada; 2Department of Marketing & Management, University of Southern Denmark, Odense, Denmark; 3Product Development and Innovation Program, Department of Technology and Innovation, University of Southern Denmark, Odense M, Denmark

2.1 2.1.1

Introduction What makes business planning for engineers so unique?

What would be the context that would require discussing the nature of business planning activities with a specific focus on engineers? One of the possible contexts is one of the established engineering firms interested in refining their existing business plans. There is also the entrepreneurial context when engineers become entrepreneurs in a technology-driven business environment aiming at creating and growing a business focusing on the development of new technological products and services. Engineers who have become entrepreneurs typically develop a business that reflects their previous academic and professional expertise. Thus the product or service they are willing to commercialize has often been part of their Research and Development (R&D) passion for many years. They would therefore often ramp up their business creation from an R&D perspective, approaching the entrepreneurial process with a “technology in search of a marketplace” mind-set as opposed to a “need in search of a solution” mind-set (Servo, 2005). The “need in search of a solution” mind-set has its starting point in the marketplace where the outcome consists of more incremental innovations, whereas the “technology in search of a marketplace” is usually developed with a focus on the new technology with a stronger predisposition toward radical or disruptive innovations. Quite often in such situations, the specific engineering product or service is new to both the firm and the world, thus requiring the exploitation of new or emergent markets. This chapter focuses on the nature of business planning activities from an entrepreneurial perspective. This perspective, however, is not limited to technology start-ups or newly created engineering firms. It is equally relevant to established firms investing in projects that assemble and deploy highly qualified human resources and heterogeneous assets that are intricately related to advances in scientific, engineering, and technological knowledge for the purpose of creating and capturing value for the firm (Bailetti, 2012). One can speak therefore of a business planning approach that could be applied to a broader entre-/intrapreneurial context of technology-driven business Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00002-3 Copyright © 2020 Elsevier Ltd. All rights reserved.

20

Start-Up Creation

environments. The adoption of such perspective implies multiple challenges for engineering professionals, which are related to the various uncertainties and risks they are forced to deal with.

2.1.1.1

Uncertainties and risks typical of technological business environments

There are multiple ways of conceptualizing and categorizing uncertainty and risk, which requires making a clear distinction between the two terms (Schmidt and Keil, 2013). In a situation of risk, the future is known in terms of statistical probabilities expressed in the form of means and distributions. Uncertainty, on the other hand, characterizes a situation where neither means nor distributions can be known. In an environment characterized by uncertainty, it is not possible to have more accurate information in a strict sense. What really matters is the interpretation of information. Firms and managers use pieces of information to classify future states subjectively and form beliefs about these states or estimates of them, essentially transforming the situation of uncertainty into one of risk (Schmidt and Keil, 2013). Entrepreneurs use their personal judgment, i.e., their ability to integrate many bits of information, view objectively the various aspects of their particular situation, and conceptualize alternative feasible futures. The emphasis on the ability of managers to transform situations of uncertainty into situations of risk is particularly relevant within the context of engineering or technology-driven businesses. Maurya (2012) adopted a product development perspective on defining uncertainty and risk. According to him, building a successful product is fundamentally about risk mitigation. Technology start-ups, new engineering firms, or new R&D-based product development projects in existing firms are a risky business, and the real job of the managers is to systematically derisk the core business activities over time. The biggest risk of all for a new firm developing a new product is building something that nobody wants. Maurya refers to Douglas Hubbard (2014) to make a clear distinction between uncertainty and risk. Uncertainty is the lack of compete certainty, that is, the existence of more than one possibility. Risk is a state of uncertainty where some of the possibilities involve a loss, catastrophe, or other undesirable outcome (Maurya, 2012, p. 49). That is why the way to quantify risk when developing a new product, designing a new business model and creating a new venture, is to quantify the probabilities of the specific outcomes in parallel to quantifying the associated losses due to getting it wrong about specific aspects of these outcomes. Recent publications have explicitly discussed the nature of uncertainty in technology-driven business environments (Tanev et al., 2015). There are, for example, technological, market, competitive (Allen, 2010; Yadav et al., 2006), and resource uncertainties (Arteaga and Hyland, 2013). The technological uncertainty is associated with issues such as whether or not the product will function as promised; the delivery timetable will be met; the vendor will give high-quality service; there will be side effects of the product; the new technology will make the existing technology obsolete. The market uncertainty is associated with issues such as the kind of needs that are supposed to be met by the new technological product and how these needs would change

Business plan basics for engineers and new technology firms

21

over time; whether or not the market would adopt industry standards; how fast will the innovation spread; and how large a potential market niche is. The uncertainty of the competitive environment is associated with the inherent competitive volatility of high-technology markets. It refers to changes in the competitive landscape such as newly emerging competitors, their product offerings, or the tools they use to compete as well as their new defensive intellectual property (IP) protection moves. Resource uncertainty is associated with the lack of information about the availability of funding, specific human resources and competency gaps about product commercialization in a specific global context, innovation talent and relevant technology development, commercialization partners at a specific global location, etc. (Arteaga and Hyland, 2013, p. 51). Furr et al. (2014) have pointed out that the increasing degree of uncertainties in the overall global business environment has created the need to change the way most organizations and, especially, start-ups have been managed. According to Furr and Dryer, there are three types of uncertainty that influence firm’s ability to create new customers: demand uncertainty, technological uncertainty, and environmental uncertainty that is associated with the overall macroeconomic environment and government policy. Sarasvathy et al. (2014) focus on the uncertainties associated with running a business internationally or on a global scale. According to them, there are at least three characteristics of conducting cross-border business activities. The first one is the need to address cross-border uncertainties. The second one is the need to leverage limited resources. Operating by leveraging limited resources within a context involving political, economic, and sociocultural risks is particularly challenging for new technologybased firms. The third characteristic is related to the challenges associated with the participation in various dynamic networks since “creating, maintaining, growing, and managing networks, whether at the individual, organizational, or interorganizational level, becomes more challenging across borders because of geographic and cultural distance” (Sarasvathy et al., 2014, p. 76). The different types of risk could be categorized in different ways. It should be admitted that the different categorization schemes could be sometimes overlapping but sill useful as an exploratory lens helping the risk management process. For example, Maurya (2012) suggests that risks in a start-up company could be divided into three general categories: product riskdgetting the product right, customer riskd building a path to customers, and market riskdbuilding a viable business. Adner (2013) points out, however, that an overemphasis on the risk associated with the internal execution of a firm creates an innovation blind spot. By adopting an ecosystem perspective, Adner suggests using two additional types of riskdcoinnovation and adoption chain risks. Coinnovation risk is the extent to which the success of an innovation depends on the successful commercialization of other innovations. Adoption chain risk is the extent to which partners will need to adopt firm’s innovation before end consumers have a chance to assess the full value proposition. Interestingly, Girotra and Netessine (2014) have suggested a categorization of risk as part of a business model development and innovation framework that could be related to the categorization suggested by Adner (2013). According to Girotra and Netessine, the key choices entrepreneurs and executive managers make in designing a business model either

22

Start-Up Creation

increase or reduce two characteristic types of risk: (1) information riskdwhen one makes strategic operational decisions without enough information and (2) incentivealignment riskdwhen entrepreneurs need to make assumptions about the expected incentives of all the relevant stakeholders involved in the company value creation network. Girotra and Netessine (2014) are fully aware that there are other types of risk such as financial and technological but believe that by mitigating information and incentive-alignment risk, firms can improve their ability to deal with all other risk categories. The main reason to highlight the approach suggested by Girotra and Netessine is twofold. First, their framework provides a link between the processes of risk management and business model development. This link is highly relevant for the context of new technology-based or engineering businesses. Second, the explicit articulation of incentive-alignment risk correlates with the categorization of risk in the wide lens approach to innovation suggested by Adner (2012), which specifies the need for the alignment of the relative benefits of all potential stakeholders involved in the business ecosystem.

2.1.1.2

Three primary challenges: financing, sizing markets, and intellectual property management

The interplay between the above uncertainties and risks in new or existing engineering or technology-based firms could result in many unique issues that could be structured under three primary challenges associated with financing, sizing markets, and IP management (Servo, 2005).

2.1.1.2.1 The challenge of financing

From a financial perspective, the initial R&D phase of an engineering or technologybased business is costly and risky. There might be a substantial uncertainty associated with the development of the technology. Furthermore, the market adoption rate will be difficult to determine when the technology is new. The combination of high cost and high risk is not a formula that attracts investors. The substantial amount of technological and market uncertainty keeps private sector investors away simply because they prefer that risks are reduced before capitalization. Capitalization during the initial R&D phase can therefore be challenging and requires a focus on risk mitigation during the development phase. Entrepreneurially oriented engineering professionals should be therefore very careful when considering the benefits of raising venture capital at the early stages of their businesses. Once the R&D phase is complete, they must find partners and funding mechanisms to support engineering, manufacturing, marketing, sales, and distribution activities. This leads to several choices that require familiarity with the pros and cons of a wide range of equity and debt financing methods (Servo, 2005).

2.1.1.2.2 The challenge of sizing markets The R&D context of technology-driven and engineering businesses forces their executive managers to deal not only with new technologies but also with new or emergent markets. Dealing with the combination of newly developed technologies and new or

Business plan basics for engineers and new technology firms

23

emergent markets leads to difficulties when the market size and adoption process are to be determined. Unlike entrepreneurs who are providing a solution to an existing market, where relevant market data can be easily found, technology entrepreneurs should adopt a hypothesis-driven approach to determine the market size for their products and the rate of growth. The rate of acceptance depends not only on the ability of the team to nail the problem/solution fit but also on the potential impact of current legislations, breakthroughs in other related technologies, and the quality of articulation (awareness) of the customer need before the product launch. These factors link together market, adoption chain, and coinnovation risks, which makes the commercialization of the product very difficult. Even the most brilliant innovation cannot succeed when it depends on other innovations or if you do not reach your customers through the right channels. The global aspect of a business complicates even further the marketing perspective when cross-border uncertainties become highly relevant (Sarasvathy et al., 2014).

2.1.1.2.3 The challenge of intellectual property management Creating a business might result in a technology or product that is patentable. Patents and other forms of intellectual property such as trade secrets, copyright, and trademarks are valuable assets not only for the engineering entrepreneurs but also for potential investors. IP management depends on several factors such as the technology or industry sector, the size and maturity of the business, its technology lifecycle, and the business and market environment (Wilton 2011, p. 5). The IP strategy should be aligned with the business strategy from the beginning since it might constitute an important source for generating increased returns on R&D investments and added business value (Wilton 2011). At the same time, the risks adopted by engineers during the commercialization of a patent are generally poorly understood. On the one hand, there is a high degree of personal risk, which is a function of the chance that the project will fail, and the amount of resources invested by the inventors. The inventors should therefore try to understand risk from an objective perspective by making realistic assessments of the likelihood of success. Technology risk on the other hand is a function of the specific characteristics of the scientific or engineering field and the extent of novelty. In addition, there is commercial risk that is described by the possibility that despite overcoming its technical milestones, the invention does not become a success due to factors related to the market environment or competition. Commercial risks can be moderated to a certain extent by appropriate management skills. Inventors and investors must be aware that IP risk management is a continuous effort and does not end with the success of an invention or patent (Levy, 2006). It is therefore important that the engineers engaged in entrepreneurial activities become familiar with issues regarding IP protection to develop a strategy for appropriately protecting their innovations from early on. However, some forms of IP protection are expensive and involve a complicated process that could be associated with additional financial, human resource, and decision-making risk management (Servo, 2005).

24

2.2

Start-Up Creation

How to approach business planning for engineers?

Given the specific characteristics of engineering entre-/intrapreneurial context, the business planning process could be articulated in terms of two major components or phases: (1) the articulation and shaping of a viable business model and (2) growing and scaling up the business. While established companies seem to focus on executing their business models according to their initial plan, start-ups are operating in a “search” mode looking for a scalable business model to develop their plan around (Blank and Dorf 2012). This is what the lean start-up approach is dealing with (see Chapter 4 in this book). By combining hypothesis-driven product development, agile engineering and customer development a lean start-up focuses on testing the initial hypothesis about the product, running experiments, and learning until the product/market fit has been established. Product/market fit is where a start-up meets the early adopters’ needs and expectations by solving a highly valuable problem. Scaling happens after a company achieves product/market fit, i.e., when the technology or product has achieved enough traction. Traction is a measure of a new product’s degree of adoption by its target market. Investors care about traction over everything else (Maurya 2012). This is when the transition from early adopters to mainstream customers happens. In Crossing the Chasm, Geoffrey Moore (1991) emphasizes that this is a challenging point and many start-ups struggle to cross the chasm being unable to scale up. Today, there are several approaches to start and establish new start-ups. There seems to be, however, a dearth of tools that could help start-ups to scale. As Daniel Isenberg asks: “Which is more important, giving birth or raising children?”1 He further claims that current entrepreneurship policy favors quantity of start-ups at the expense of scale-ups. Focusing on the challenges associated with the transformation from being a start-up to a scale-up therefore constitutes a critical part of the business planning process.

2.3

Developing and articulating the business model

The canvas approach has become the most popular tool for the articulation and refining business models in both start-ups and established firms (Blank, 2012; Osterwalder and Pigneur, 2010). It is especially popular in the case of start-ups or new product development projects where the managers need a tool for framing their initial hypothesis and documenting their learning, as they iterate through the early stages of their business. The canvas approach is more flexible and rather holistic as compared with the direct focus on writing a business plan. Rather than engaging months of planning and research, managers accept that all they have on day 1 is a series of untested hypotheses, and instead of writing an intricate business plan, they summarize their hypothesis on the canvas. As the hypothesis get tested and validated, the canvas is used as a way of evolving the business plan rather than to come up with a fixed ideal solution. 1

https://hbr.org/2012/11/focus-entrepreneurship-policy#

Business plan basics for engineers and new technology firms

25

The most popular canvas is the business model canvas (BMC) developed by Alexander Osterwalder (Osterwalder and Pigneur, 2010). Table 2.1 shows its nine building blocks together with the type of questions that could help in the process of their formulation. The BMC provides the main structure of a business plan with a focus on ease of use, flexibility, and transparency, including the key drivers of a business: customer segments, value propositions, channels, customer relationships, revenue streams, key activities, key resources, key partnerships, and cost structure. There are two important practical points that should be mentioned with respect to the use of the BMC. First, the BMC is just a tool that helps the initial formulation and the continuous refinement of the business model as a key component of the business plan. It is not the filling up of the building blocks on the canvas that will make a business successful but the proper managerial reflections and the follow-up activities corresponding to them. Second, the BMC is not a dogmatic framework but just a starting point that could be modified or refined depending on the specific business context, technological solution, and customer base. That is why there have been multiple versions of the canvas approach that could be applied to different business circumstances. Examples of such modified versions are the lean canvas (Maurya, 2012) and the business model snapshot (Furr et al., 2014). They both focus on providing more systematic tools to mitigate risk in new product, service, and business development. The lean canvas approach proposed by Ash Maurya (Table 2.2) appears to be more intuitive and better suited to address the multiple uncertainties and risks (Section 2.1.1) that are typical of the context of new technology start-ups and engineering professionals in technology-based businesses. The main objective behind its introduction was to make it as actionable as possible while staying as close as possible to the entrepreneurial context. The way to make the canvas more actionable was to focus on searching for insights about what is most uncertain and most risky.2 The lean canvas is shown in Table 2.2. It helps in deconstructing the business model into nine distinct components that are then systematically tested starting from the ones with the highest and moving to the one with the lowest risks. Following the roadmap proposed in the lean canvas approach, it is important to emphasize one of its key assumptions: Your product is not the technological solution you are providing; your product is the business model. Ash Maurya has built the roadmap based on the three key stages of a start-up: problem/solution fit, product/market fit, and scaling up. Every start-up runs through each of these stages where risk mitigation through each stage should be the focus of its activities.

2.3.1

The three stages of the lean canvas approach

In the problem/solution fit stage, the focus is on finding out if there is a problem worth solving. The first stage can be navigated without even building a product. Instead, a demo can be developed (a screen shot, video, or a physical prototype) that could engage customers in sharing their vision about how to solve the problem. The demo 2

http://leanstack.com/why-lean-canvas/

Table 2.1 The business model canvas together with the questions that could help clarifying the key components of a business plan at the early stages of a business. Key Partners Who are our key partners? Who are our key suppliers? Which key resources are we acquiring from our partners? Which key activities do partners perform?

Key Activities What key activities does our value proposition require? Our distribution channels? Customer relationships? Revenue streams?

Key resources What key resources does our value proposition require? Our distribution channels? Customer relationships? Revenue streams?

Cost structure What are the most important costs inherent to our business model? Which key resources are most expensive? Which key activities are most expensive?

Value proposition What value do we deliver to the customer? Which one of our customers’ problems are we helping to solve? What bundles of products and services are we offering to each segment? Which customer needs are we satisfying? What is the minimum viable product?

Customer relationships How do we get, keep, and grow customers? Which customer relationships have we established? How are they integrated with the rest of our business model? How costly are they?

Customer segments For whom are we creating value? Who are our most important customers? What are the customer archetypes?

Channels Through which channels does our customer segment want to be reached? How do other companies reach them now? Which ones work best? Which ones are most costefficient? How are we integrating them with customer routines? Revenue streams For what value are our customers really willing to pay? For what do they currently pay? What is the revenue model? What are the pricing tactics?

Reproduced from: Osterwalder, A., Pigneur, Y., 2010. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. John Wiley & Sons and Blank, S., (2013). Why the lean start-up changes everything. Harvard Business Review 1-9.

Business plan basics for engineers and new technology firms

27

Table 2.2 The lean canvas (the numbering indicates the order in which the different building blocks are usually addressed). 1. Problem Top three problems

4. Solution Top three features

8. Key metrics Key activities you measure 7. Cost structure Customer acquisition costs Distribution costs Hosting People, etc.

3. Unique value proposition Single, clear compelling message that states why you are different and worth paying attention

5. Unfair advantage Can’t be easily copied or bought

2. Customer segments Target customers

9. Channels Path to customers 6. Revenue streams Revenue model Lifetime value Revenue Gross margin

Maurya, A., 2012. Running Lean: Iterate from Plan A to a Plan That Works, Sebastopol, CA, O’Reilly Media, Incorporated.

should help the customer visualize the solution by demonstrating the unique value proposition (UVP). During this stage, entrepreneurs attempt to answer the key question (the existence of a problem worth solving) by using a combination of qualitative customer observation and interviewing techniques on the basis of which they derive the minimum feature set to address the right set of problems, which is also known as the minimum viable product (MVP). The problem/solution fit is validated when you repeatedly get the customers to accept the UVP. During the second stage (product/market fit), the key question is if the company has built something that people want. Once there is a problem worth solving and an MVP has been built, one needs to test how well the solution solves the problem. The first significant milestone is achieving market traction. At this stage, the initial plan should start workingdthere are customers who are signing up, the company retains them and gets paid. The third stage (scaling up) focuses on acceleration, growth, and scaling the business model. Before product/market fit, the focus of a start-up centers on learning and pivots (substantial changes in the initial idea). After product/market fit, the focus shifts toward growth and optimizations. In this sense, achieving product/market fit is the first significant milestone of a start-up, which greatly influences both its strategy and tactics.

2.3.2

Lean canvas approach metaprinciples

The lean canvas framework is organized around three metaprinciples: (1) documenting your plan A; (2) identifying the riskiest part of your plan; and (3) systematically testing

28

Start-Up Creation

your plan. Documenting plan A is a snapshot of the initial plan. Entrepreneurs start by documenting their plan A, focusing on the identification of a potential customer segment, and then continue sketching out their first guess at what the business model for each customer segment, potential solution, or customer channel. When this first step is done, an entrepreneur will have multiple versions of plan A, which are to be prioritized in terms of risk in the next step. Having developed multiple canvases, the focus in the next step is on prioritizing where to start. The prioritizing should be undertaken by focusing on ranking the business models in terms of lowest risk. The objective is to find a business model with a big enough market that can be reached, with customers who need a product around which a viable business can be built (Maurya, 2012). The weighting criteria for prioritizing the risk are the customer pain level (the problem), the each of reach (the channels), the price/gross margin (revenue streams and cost structure), market size (the customer segment), and the technical feasibility (the solution). These criteria are evaluated against the three types of risks suggested by Maurya (2012): product riskdgetting the product right, customer riskdbuilding a path to customers, and market riskdbuilding a viable business. The lean canvas automatically captures uncertainties that are related to risk in terms of loss of opportunity costs and real costs. The final result is a lean canvas capturing the key business components that could be further tested and validated. Systematically testing the initial plan is the third step where all assumptions made during the articulation of the business model are transformed into hypotheses that can be either validated or invalided through running experiments with customers.

2.3.3

Choosing between the canvas and the business model canvas

The existence of multiple business model development canvases may create some ambiguity in entrepreneurially oriented engineering professionals and founders of new technology firms. In addition, academics and practitioners may disagree about the degrees of usefulness of one or another canvas by providing arguments derived from the circumstances of their research or practical experience. Our position is that there could be a valuable interplay between the lean canvas and BMC approaches to managing uncertainty and risks during business model development in engineering and technologybased firms (Borseman et al., 2016). There are several reasons for the adoption of such blended approach. We believe that Maurya makes a good point by claiming that the composition of the lean canvas addresses in a better way one of the key characteristics of early stage start-ups, i.e., the fact that they operate under conditions of high uncertainties and multiple risks. We would argue, however, that after using Maurya’s approach at its early stages, a start-up gradually moves to the adoption of a relatively well-defined business model including the right key partners, activities, and resources, which are better addressed in the BMC. The logic of such shift could be conceptualized by focusing on the key differences between lean canvas (problem, customer segment, solution, value proposition, key metrics, and unfair advantage) and BMC (key

Business plan basics for engineers and new technology firms

29

partners, value propositions, key activities, resources, customer relationships). While the lean canvas focuses on the articulation of the customer value proposition, the BMC allows executive managers to focus on the multiple value propositions to customers and key partners including the key activities and resources enabling the value creation process. The focus on multiple value propositions suggests that some of the ideas of the wide lens approach (Adner, 2012) could be quite appropriate. Adner argues that the initial value proposition should be translated into a visual value blueprint to visualize the emerging relationships between the multiple key partners, key activities, and resources, as well as enable the assessment of alternative configurations, leading to a shared understanding and agreement among the partners as to how the different business model elements should be optimized. By making these relationships clear, the value blueprint forces all relevant actors to confront the challenges that lie beyond their own immediate responsibilities, to consider how they want to organize and address the risks that are inherent in every collaborative endeavor, and to deal with these issues proactively. The value blueprint approach to the articulation of the multiple value propositions for all relevant actors in the emerging business ecosystem could be enhanced by the concept of minimum viable footprint (MVF)dthe smallest configuration of elements or partners that can be brought together and still create unique commercial value (Adner, 2012). The MVF concept emphasizes the fact that the initial business model design should result into a viable business ecosystem that could be further developed by adding additional elements to the MVF (Adner calls this additions “staged expansions”) so that each new element benefits from the system already in place and increases the value creation potential for the subsequent element to be added. In this sense, the emergence of an MVF should indicate the moment in time when the BMC should be adopted as an alternative to lean canvas.

2.3.4

The challenges of articulating a unique customer value proposition

The choice of one or another business model development canvas does not solve the problem of designing and articulation an attractive or irresistible value proposition (VP). The VP concept is one of the most widely used and most important in business (Payne et al., 2017; Anderson et al., 2006). It is a strategic sales and marketing communication tool that is used by a company to articulate how it aims to provide value to its target customers and its most relevant stakeholders. According to Webster (2002, p. 61), a VP should become the firm’s single most important organizing principle since it is crucial for how the firm organizes its entire business rationale and has significant performance implications (Payne and Frow, 2005). The articulation of a VP as a message is usually communicated via the company website (Goldring, 2017). Unfortunately, many companies do not benefit from the power of an adequate online communication of their VPs. In addition, there is little known about how companies could enhance the communication of their VPs on their web pages (Goldring, 2017, p. 65). The situation is even worse in the case of new engineering firms and technology ventures. Companies seem to underutilize their

30

Start-Up Creation

websites as a medium for the efficient communication of compelling VPs to customers and stakeholders. This could be due to multiple reasons. First, many new ventures, being in their early stage, are still in the process of shaping their market offers. It is therefore very hard for them to come up with a clear description of market offer benefits, target customers, and customer value elements. This is especially true in the case of radically innovative market offers (Wouters et al., 2018). In such cases, the founders of the new venture may need to invent the language that would best express the novelty of their products or services (Spender, 2015). The situation is even more complicated in the case of transnational ventures that need to communicate their VPs in two completely different country settings (Bailetti, 2018). Second, new technology ventures often fall into the trap of their product focus, especially when they work in a business-to-business (B2B) context, by missing to articulate their partnership potential and business legitimacy to established customer firms. Wouters et al. (2018) recommend that new technology firms should construct two sequential value propositionsdone focusing on their innovative offering and another one focusing on their ability to offer leveraging assistance to customer firms. In addition, a new firm should critically evaluate how well its VP communicates key points of difference before sharing it with a potential customer. The key questions to answer are as follows (Wouters et al., 2018): • • • • •

Is the offer specific to the business of that particular customer? Does it talk about concrete advantages the start-up can provide for that customer’s processes and customers? Does it quantify some of those advantages in monetary terms for that customer, and is that quantification transparent? Does it convincingly and inspiringly communicate how the advantages and financial value for the customer are radically superior from what that customer already can get from established suppliers? Does it intrigue enough so that the customer might seriously consider doing business with a start-up and not with established suppliers?

Third, new ventures often benefit from the business support and mentorship provided by incubator and accelerator programs, which are driven by practitioners who tend sometimes to consider VPs as single sentence claims. The usual assumption is that all ventures could use a template to express in a couple of sentences the key dimensions of customer value. The pervasiveness of this assumption suggests that some of the most representative incubation programs do not seem to appreciate recent research on VPs or that scholars fail to contribute their research insights to entrepreneurial communities of practice (Berglund et al., 2018).

2.3.5

Value proposition research insights

Recent research literature on VPs has provided multiple valuable insights for both academics and practitioners. For example, Payne et al. (2017) identify three distinct perspectives on customer VPs: (1) supplier-determined perspective, where value is

Business plan basics for engineers and new technology firms

31

embedded in the product delivered by a supplier (value-in-exchange); (2) transitional perspective, where value is considered in the context of customers experiences during product purchase and usage; and (3) mutually determined perspective, where value emerges as a result of a mutually determined proposal in which the provider and customer jointly share resources in value creation (value-in-use). The authors propose a working definition that characterizes customer VPs as “a strategic tool facilitating communication of an organization’s ability to share resources and offer a superior value package to targeted customers” (Payne et al., 2017, p. 472). The definition emphasizes the communication role of VPs in terms of (1) the benefits and costs that establish clear differentiation from competitive offerings; (2) the ways of distributing value across the customer relationship, before, during, and after the usage experience; (3) the nature of resource sharing and engagement resulting in meaningfully cocreated customer value; (4) the design characteristics of the market offer that are most relevant to customers. Eggert et al. (2018) focus on conceptualizing VPs and communicating value in business markets. The focus on business markets is driven by the realization that in such markets, there are deeper and more complex customer relationships, the competition may be severe, and suppliers struggle to clearly differentiate their products and services. In such markets, the communication of value requires a granular approach where VPs can address three main levels: a company level; industry or market segment level; and a customer level. In B2B markets, the VP not only communicates value but is also a means of creating a dialogue where suppliers and customers share deeper insights and together carefully craft and manage their joint VPs. Payne and Frow (2014) have provided practical insights that could be highly relevant for new engineering and technology-driven firms. According to them, the articulation of the VP of a new firm is always comparative, i.e., it is always articulated with respect to existing alternative offers by competitors and best value creation practices. They suggested a process of deconstruction of an exemplar competitive organization’s VP to provide a more comprehensive understanding of the elements that could be used by other firms seeking to formulate or improve their VPs. The deconstruction process employs a business system concept as a theoretical framework to identify and examine the key business activities and the corresponding value-adding elements that comprise an organization’s value proposition. Another research review article by Goldring (2017) discusses the ways of constructing VP statements and provides insights about doing that on companies’ websites. The author points out that in many VPs “benefits are seemingly overemphasized” (Goldring, 2017, p. 64) and points out that there is lack of knowledge about the specific linguistic styles and types of expressions that are used in VP communication.

2.4

Scaling up the business

Once the business model has been developed and validated, it is time to grow the business. Following a method such as the lean canvas approach, managers will get past the early stages of growth. However, the transition from focusing on exploration to

32

Start-Up Creation

execution of a business model will change the company in fundamental ways, which involves new challenges. One of the main challenges for managers of new technology-based or engineering firms is managing the transition to growth. At this stage, a start-up should have nailed the product and the business model, and many unknowns should have been clarified. In this sense, the amount of uncertainty declines and so does the reason for applying purely entrepreneurial management practices. The focus shifts on applying more traditional management principles focusing on execution, value capture, and optimization. However, the start-up may enter a transitional phase where neither entrepreneurial nor traditional management alone is appropriate. To master the scaling process, the startup needs to blend in the two management practices, as it transitions to a mature business (Furr et al., 2014). The transition from a start-up to a mature business requires going through several stages, leading to fundamental changes in the way it operates. While there are a lot of tools available on how to develop a business, there are very few tools dealing with how to manage the scaling process. There is, however, an agreement among practitioners that the growth and scaling process can be organized around three key areas: market transitions, process transitions, and team transitions.

2.4.1

Market scaling

The main challenge for new technology firms is crossing the chasm. Geoffrey Moore (1991) argues that the gap between early adopters and early majority provides a significant challenge for companies because these groups are quite different and require completely different marketing strategies. While early adopters are willing to try something entirely new, the early and late majority wants a product solution that is error free and full-featured. The only way to cross the chasm is to put all your eggs in one basket, meaning that the strategy should be to identify a niche segment among the early majority and focus all efforts on developing the whole product solution by serving this particular segment. When this particular customer niche has adopted the solution, the firm can focus its effort on a second customer niche. The key to getting a foothold in the mass market is to use the initial customer segment as reference customers. Thereby the firm can start shaping all marketing communications to position itself as a market leader to derisk mass market adoption. The key to successfully redefining the market or create a market leader position is to choose an unoccupied space where there is a legitimate market need (Furr et al., 2014; Moore, 1991). To attract the first customer niche among the early majority, the firm should focus on developing a minimum awesome product (MAP) (Furr et al., 2014). While the MVP is used for validating the core assumptions during the initial stages among the innovators and early adaptors, the MAP is a solution that is extraordinary on the dimensions that customers value the most (Fig. 2.1). The point is to use the MVP to improve the key attributes of the solution that can evoke positive emotions and thereby turn it into an MAP by focusing on the functional, social, and emotional dimensions of the solution. While using the MAP to get the solution adopted by the early majority, the firm can move to a second customer niche. In parallel to that, the MAP is further developed into the whole solution that could address the needs of the main market.

Business plan basics for engineers and new technology firms

Chasm

Whole product solution

MAP

MVP

Innovators

33

Early adopters

Early majority

Late majority

Laggards

Figure 2.1 Minimum viable product (MVP) and minimum awesome product (MAP) versus whole product solution across the technology/product adoption life cycle Adapted from Furr, N., Dyer, J. Christensen, C.M., 2014. The Innovator’s Method: Bringing the Lean Start-Up into Your Organization. Harvard Business Review Press.

2.4.2

Process and team scaling

As a newly created technology firm grows, it will begin to see the same types of problems cropping up again and again. These issues indicate a need for standardization of its processes and workflow. As the market grows, tasks and workflow need to be standardized to continually deliver a quality product (Furr et al., 2014). To introduce scalable and standardized processes in an organization, a simple four-step road map can be used as a guiding tool (Fig. 2.2). The process starts by creating a list of tasks to be done to execute the business model. Each of these tasks is assigned to an individual. The objective of the next step is to create a common understanding among the employees. Each team member has to write a job description for the assigned task, and by reviewing each of the descriptions together in the team, people agree on how to perform certain tasks and who is responsible for what. The third step is about visually mapping out the most critical processes to detect critical linkages. The diagram will help establishing a common understanding about the most critical aspects of the processes as well as make sure that someone is assigned the responsibility for each of the key processes. The last step is to establish key metrics for the tasks and the processes and make sure someone is accountable for those metrics. It is critically important for the new firm to shift the performance metrics when scaling. While the discovery phase should be using “love metrics” such as activation,

List the tasks to be done in order to execute the business model. Assign each task to individuals.

Have each team member to write a description of the most critical processes, noting the links and relationships.

Create a visuale diagram of the most critical processes noting the links and relationships.

Link tasks and processes to performance metrics and assign responsibility to individuals.

Figure 2.2 Scaling the process. Adapted from Furr, N., Dyer, J. Christensen, C.M., 2014. The Innovator’s Method: Bringing the Lean Start-Up into Your Organization, Harvard Business Review Press.

34

Start-Up Creation

retention, and payment, the focus now should shift to using growth metrics. Growth metrics are focused on determining whether the firm delivers a reliable solution with increasing economics of scale and can include more detailed measures of users in terms of acquisition and referral (Maurya 2012), measures of the efficiency of the processes, and the revenue growth (Furr et al. 2014). By measuring the performance around the right metrics and reporting the results, the firm can improve its processes significantly. During the start-up phase, the team most often consists of people who possess good discovery skills. However, as the start-up scales up, there is a need for expertise profiles that can execute the business model. There could be a need therefore for the talent pool to change. Building the team during the growth phase requires a mix of discoveryoriented people and experts. As the team grows, it is important to focus on creating a working culture that communication processes and activities are shaped around. As the team growth, it is furthermore important to plan and structure how meetings should be organized to secure that everyone is moving in the same direction.

2.4.3

The danger of getting things wrong

Even though new technology-based firms have a great potential for wealth, value, and job creation, there is enough evidence showing that, on average, 90% of them fail. What is the main cause of such high percentage of failures? Quite often failures could be related to issues associated with premature scaling. Furr and Ahlstrom (2011) define this problem as “spending money beyond the essentials on growing the business (e.g., hiring sales personnel, expensive marketing, perfecting the product, leasing offices, etc.) before nailing the product/market fit.” In addition, start-ups “are doing good things but doing them out of order. In other words, they are doing things that seem to make sense, like investing to build the product, hiring good people to help them sell it, developing marketing materials, and essentially doing all the kinds of things that big companies with lots of resources do when they are executing on a known opportunity” (Furr and Ahlstrom, 2011). The problem is that the risk associated with these investments could be justified only by extensive preexisting market research or sales data. Instead of assessing the risks and opportunities objectively and scaling those investments accordingly, start-ups tend to rely on guesswork without really looking into the real facts. It is true that many start-ups bring products that are new to the market, i.e., they lack substantial market research and sales data. This is, however, exactly why they need to manage the scaling process in a more structured way. Another recent study has reported the top 20 most common reasons for start-ups to fail (CB Insights, 2014). Some of the most important ones are as follows: There was no market need; the firm ran out of cash; it did not have the right team; it got outcompeted; it got the pricing/cost wrong; the product design was poor, there was a need/ lack of a business model; the marketing was poor; the customers were simply ignored, etc. Interestingly, all these issues could be related to the first stage (articulation and shaping of the business model) or the second stage (the proper scaling up of the business) of the business planning process.

Business plan basics for engineers and new technology firms

2.4.4

35

The importance of the difference between growth and scale-up

One of the reasons for getting things wrong with the scale-up phase is the inability to distinguish between growing and scaling up. This is a difference that has been clearly emphasized in recent management research and practices (Picken, 2017; Zhang et al., 2015). Zhang et al. (2015, p. 243) define business model scalability as “the extent to which a business model design may achieve its desired value creation and capture targets when user/customer numbers increase and their needs change, without adding proportionate extra resources.” The definition was provided in the context of businesses focusing on using digital technologies as a key business process enabler. According to Zhang et al. (2015), scalable business models possess three distinctive characteristics: They engage both nonpaying users and paying customers; facilitate customer participation in the production of products or services; and orchestrate networked value chains by means of various participation platforms or multisided business model elements. The specificity of these scalability mechanisms is very different from the one used in traditional growth models focusing on expanding target markets or addressing new market niches, enhancing profit margins, running more intensive customer acquisition programs, or seeing external funding to grow their resource base. Picken (2017) takes another perspective on the challenges of scaling up by focusing on the crucial importance of the period of transition during which the founding team must establish a solid foundation for scaling. According to Picken, the proper management of this transition has a significant influence on the success of the venture. Picken argues that many start-ups stumble and fail at realizing their early promise because they fail to clear one or more of eight hurdles that are typical of the critical period of transition. Dealing with these hurdles and winning the race requires that the entrepreneur and the founding team • • • • • • • •

establish, communicate, and maintain a clear sense of direction; position and reposition the offering as required to meet the needs of an expanded market; develop and implement internal processes to ensure customer responsiveness; build a capable and committed management team aligned with the strategic direction; implement decision processes and infrastructures appropriate to the specific stage of the development; build financial capability focused on the efficient utilization of available resources; nurture a culture that reflects values, beliefs, and norms supportive of the business purpose; and recognize the inherent vulnerabilities of an emerging enterprise and proactively manage risks.

It is important to point out that the management literature on business scaling in the way it was defined by Zhang et al. (2015) is in its infancy. One of its important messages is that the scale-up phase is not an addition to the business model development phase; it is built in it. Entrepreneurially oriented engineering professionals and technology experts should transform their thinking by examining the scaling potential of their business models and exploring the potential of digital technologies as enablers of scalable business operations.

36

Start-Up Creation

2.5

A business plan template

The business plan serves as the executable plan for the start-up (Faley, 2015). While the phrase “business plan” conjures images of 60-page documents full of dense charts and diagrams, the business plans of today have become a lot shorter (Blumberg, 2013; Anthony, 2014; Faley, 2015). From 60-page documents, they now often come in the form of slide decks or shorter executive summaries. Furthermore, the key of a successful business plan in today’s rapid changing environment is to consider the plan as the definite pivot point of the company, which means that the business plan should be treated as a dynamic tool by updating it as new learning emerges (Faley, 2015). Besides being an executable plan for a new firm, another fundamental aspect of the business plan is to keep everyone involved on the same page. For a start-up, there are two primary stakeholders to articulate the business plan to investors and employees. While investors focus on the size of the market opportunity and the likely revenue, employees are more interested in knowing the shape of their future workelife (Blumberg, 2013). Two versions of the business plan can therefore be articulated: a version for investors focusing on the likely revenue of the opportunity and a version for employees focusing on articulating the overall vision and strategy that guide all employees toward the same goal during the initial phase.

2.5.1

A minibusiness plan for investors

Articulating a business plan to investors can be done either in a written document or by conducting an oral investor presentation using slide decks (Blumberg, 2013). There are several ways to structure the content of the business plan; however, at his early stage, the start-up should at least be able to articulate the size of the opportunity, the competitive advantages, current status and road map from today, and the strengths of the team (Blumberg 2013). Anthony (2014) proposes a structure for organizing a mini business plan, which articulates both the elements of the business model and the aspects of scaling. The mini business plan template and other business planning tools can be downloaded at https:// www.innosight.com/insight/the-first-mile-2/. The key template elements are as follows: • • • • • •

an executive summary or a pitch if presented orally to investors; the target customer and their problem; the severity of the customer pain/need; and size of the addressable market; the proposed solution and the problem-solution fit; an explanation why potential customers would buy from you and ignore competitive alternative offers; the key business model elements; the configurational fit and the synergy between these elements; the plan to scale the business model: what are the specific scalability mechanisms; how are they going to be implemented; how are they going to increase revenue without adding proportionate extra resources; the thumbnail financials;

Business plan basics for engineers and new technology firms

• •

37

the critical assumptions behind your financials, business model configuration decisions, and scalability expectations; and the proposed plan to test the assumptions and correct/refine your business model.

The insights from the early discovery-based stages as well as the required scaling activities could be easily articulated by using the above template.

2.5.2

The key points in the business plan for the employees

The internal challenges for a company in the process of scaling up are well known. Furr et al., (2014) recommended using the so-called V2MOM scaling tool to simplify the internal adoption of the scalability measures. It is a strategic planning tool that allows a start-up or an established company to define goals and organize ways to execute them. The V2MOM tool ensures that everyone is moving toward the same goal, regardless of the size of the company. The tool is therefore especially well suited for companies placed in a rapid changing environment where there is a need to evolve continuously. V2MOM stands for vision, values, methods, obstacles, and measures. The articulation of a vision helps in defining what the company wants to do. The values refer to the principles and beliefs that guide the company toward its vision. The methods illustrate the actions and steps that everyone needs to take to achieve the vision. The obstacles identify the challenges and issues that should be overcome to achieve the vision. The measures define the results aimed to achieve. V2MOM therefore helps the company to define where it wants to go, what things are important, what it will do to get there, what would prevent it from going there, and how it knows whether it is successful or not (Furr et al., 2014). Salesforce.com used V2MOM in their early days as part of their business plan and is still using it to guide the overall organizational goal of today (Furr et al., 2014). The structure of the tool can therefore be used in all phases of the life cycle of an organization.

2.6

Conclusion

This chapter focused on describing the basics of the business planning process in the context of engineering professionals. One of its key contributions is the detailed discussion of the unique characteristics and challenges of technology-driven business environments, which are typical of engineering professionals. One of the key characteristics of such environments is the combination of multiple uncertainties and risks that could potentially affect the initiation and the evolution of a newly created technology-based or engineering business. The main challenge in addressing the multiple uncertainties and risks is that they have completely different sources and nature. For example, there is interplay between the uncertainties associated with the degree of newness of the technology and the early stage of a new technology firm. Fortunately, the recent growth of interest in the lean start-up approach, agile technology/product development, and hypothesis-driven technology entrepreneurship has resulted in

38

Start-Up Creation

some key publications, frameworks, and models focusing on the implementation of a rigorous scientific approach to uncertainty management. This chapter reflects this trend and offers a brief introduction to challenges of integrating these approaches in the context of the business planning process. The business planning process is considered as consisting of two major partsdarticulation and development of a viable business model, and the managing the growth and scaling up of the business. The development of a viable business model is described through the lean canvas approach suggested by Maurya (2012). The lean canvas approach is specifically designed to address the unique uncertainties and risks associated with the development and the introduction of new products by newly created firms. It works with a simple risk categorization focusing on product, customer, and market risks. It allows, however, to address any other types of risks such as the ones that are discussed here and typical of technology-driven and engineering business environments. The growth and scaling up of the business is described as consisting of three major componentsdmarket scale-up, team scale-up, and process scale-up. Our description refers to a practical tool suggested by Furr et al. (2014), which should help the operationalization of the business scale-up process in the context of engineering businesses. Without pretending to offer an exhaustive picture of the complex process of business development and planning, this chapter is an expression of a vision, which emphasizes the fact that business development and planning knowledge and skills should become part of the culture of today’s engineering professionals.

References Adner, R., 2012. The Wide Lens: What Successful Innovators See That Others Miss. Penguin Group. Adner, R., 2013. The Wide Lens. What Successful Innovators See that Others Miss, Revised edition. Portfolio/Penguin, New York. Allen, K., 2010. Entrepreneurship for Scientists and Engineers. Prentice Hall. Anderson, J., Narus, J., Van Rossum, W., 2006. Customer VPs in business markets. Harvard Business Review 84 (3), 91e99. Anthony, S., 2014. The First Mile: A Launch Manual for Getting Great Ideas into the Market. Harvard Business Review Press. Arteaga, R., Hyland, J., 2013. Pivot: How Top Entrepreneurs Adapt and Change Course to Find Ultimate Success. John Wiley & Sons. Bailetti, E., 2018. Transnational entrepreneurship: distinctive features and a new definition. Technology Innovation Management Review 8 (9), 28e38. Bailetti, T., 2012. Technology entrepreneurship: overview, definition, and distinctive aspects. Technology Innovation Management Review 5e12. February. Berglund, H., Dimov, D., Wennberg, K., 2018. Beyond bridging rigor and relevance: the threebody problem in entrepreneurship. Journal of Business Venturing Insights 9, 87e91. Blank, S., 2013. Why the lean start-up changes everything. Harvard Business Review 1e9. Blank, S., Dorf, B., 2012. The Start-Up Owner’s Manual: The Step-by-step Guide for Building a Great Company. K&S Ranch Incorporated, Pescadero, CA. Blumberg, M., 2013. Start-up CEO: A Field Guide to Scaling up Your Business. Wiley.

Business plan basics for engineers and new technology firms

39

Borseman, M., Tanev, S., Weiss, W., Rasmussen, E.S., 2016. Lost in the canvases: managing uncertainty in lean global startups. In: Huizingh, E., Conn, S., Torkkeli, M., Bitran, I. (Eds.), Charting The Future Of Innovation Management - Proceedings of the ISPIM Innovation Forum. Boston (MA), USA, 13-16 March, 2016. Eggert, A., Ulaga, W., Frow, P., Payne, A., 2018. Conceptualizing and communicating value in business markets: from value in exchange to value in use. Industrial Marketing Management 69, 80e90. Faley, T., 2015. The Entrepreneurial Arch: A Strategic Framework for Discovering, Developing and Renewing Firms. Cambridge University Press. Furr, N., Dyer, J., Christensen, C.M., 2014. The Innovator’s Method: Bringing the Lean StartUp into Your Organization. Harvard Business Review Press. Furr, N., Ahlstrom, P., 2011. Nail it Then Scale it: The Entrepreneur’s Guide to Creating and Managing Breakthrough Innovation. NISI Institute. Girotra, K., Netessine, S., 2014. The Risk-driven Business Model. Harvard Business School Publishing. Goldring, D., 2017. Constructing brand VP statements: a systematic literature review. Journal of Marketing Analytics 5 (2), 57e67. Hubbard, D., 2014. How to Measure Anything: Finding the Value of Intangibles in Business, third ed. Wiley. Insights, C.B., 2014. The Top 20 Reasons Startups Fail. Available at: https://www.cbinsights. com/blog/startup-failure-post-mortem. (Accessed 3 October 2015). Levy, A., 2006. Starting up and financing your venture. In: Junghans, C., Levy, A. (Eds.), Intellectual Property Management: A Guide for Scientists, Engineers, Financiers, and Managers: A Guide for Scientists, Engineers, Financiers, and Managers. Wiley-VCH Verlag, pp. 119e142, 2006. Maurya, A., 2012. Running Lean: Iterate from Plan A to a Plan That Works. O’Reilly Media, Incorporated, Sebastopol, CA. Moore, G., 1991. Crossing The Chasm: Marketing and Selling High-Tech Products To Mainstream Customers. HarperBusiness (revised 1999, 2006 and 2014). Osterwalder, A., Pigneur, Y., 2010. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. John Wiley & Sons. Payne, A., Frow, P., Eggert, A., 2017. The customer VP: evolution, development, and application in marketing. Journal of the Academy of Marketing Science 45 (4), 467e489. Payne, A., Frow, P., 2014. Deconstructing the value proposition of an innovation exemplar. European Journal of Marketing 48 (1/2), 237e270. Payne, A., Frow, P., 2005. A strategic framework for customer relationship management. Journal of Marketing 69 (4), 167e176. Picken, J., 2017. From startup to scalable enterprise: laying he foundation. Business Horizons 60, 587e595. Sarasvathy, S., Kumar, K., York, J. G., Bhagavatula, S., 2014. An effectual approach to international entrepreneurship: overlaps, challenges, and provocative possibilities. Entrepreneurship Theory and Practice 38 (1), 71e93. https://doi.org/10.1111/etap.12088. Schmidt, J., Keil, T., 2013. What makes a resource valuable? identifying the drivers of firm idiosyncratic resource value. Academy of Management Review 38 (2), 206e228. Spender, J.-C., 2015. Building language and the business model. In: Business Strategy: Managing Uncertainty, Opportunity, and Enterprise. Oxford University Press, pp. 144e201. Servo, J., 2005. Business Planning for Scientists & Engineers, fourth ed. Dawnbreaker.

40

Start-Up Creation

Tanev, S., Rasmussen, E., Zijdemans, E., Lemminger, R., Limkilde, L., 2015. Lean and global technology start-ups: linking the two research streams. International Journal of Innovation Management 19 (3). https://doi.org/10.1142/S1363919615400083. June, 41 pp. Webster, F., 2002. Market-driven Management: How to Define, Develop and Deliver Customer Value, second ed. John Wiley & Sons, Hoboken. Wilton, A., 2011. Patent value: a business perspective for technology start-ups. Technology Innovation Management Review 5e11. December 2011. Wouters, M., Anderson, J., Kirchberger, M., 2018. New-technology startups seeking pilot customers: crafting a pair of VPs. California Management Review 60 (4), 101e124. Yadav, N., Swami, S., Pal, P., 2006. High technology marketing: conceptualization and case study. Vikalpa 31 (2), 57e74. Zhang, J., Lichtenstein, Y., Gander, J., 2015. Designing scalable digital business models. In: Business Models and Modelling. Advances in Strategic Management (Book 33). Emerald Group Publishing, Bingley, UK, 241-27.

Lean startup 1

2

3

Erik Stavnsager Rasmussen , Stoyan Tanev 1 Department of Marketing & Management, University of Southern Denmark, Odense, Denmark; 2Technology Innovation Management Program, Sprott School of Business, Carleton University, Ottawa, ON, Canada

3.1

Introduction

In the 2000s, a new type of literature emerged with Steven Blank and Eric Ries in front, claiming that it is possible to reduce the risk of launching new products. In this chapter, the literature will be grouped under the term lean start-up (LS). The core of the LS principles is to reduce waste by not using resources on hypotheses about the product or market place that has not been validated by the customer (Ries, 2011, 2017; Blank et al., 2013). It is thus imperative to learn from potential customers early in the process and thereby to produce a solution based on customer needs and wants. All too often, entrepreneurs right from the start fall in love with their product or technology, thereby ignoring negative feedback from customers and in the end spending years building a product based on a vision that no one else shares (Furr and Ahlstrom, 2011). To avoid this, LS suggests an approach of going through an iterative process where problem, products, and customer hypotheses are developed and validated by the customers. Jim Collins and Morten T. Hansen, in their book “Great by Choice” (Collins and Hansen, 2011), state that top-performing companies “fire bullets before firing cannonballs.” This process can be seen as the difference between traditional business planning and the LS approach. LS is about continuously firing small bulletsdtesting different hypotheses about the product and business model to find out if the customers would validate them or not. First, when every aspect of the business model has been validated, then the cannonball is fired, and the business moves from exploration to an execution mode and focuses on scaling. The very same argument is also at the core of the book “Nail It then Scale It” by Furr and Ahlstrom (2011) (see also Furr et al., 2014). Here the argument is that it is beneficial for a company to implement lean thinking in their launch process. Instead of using large amounts of both resources and money to go through the traditional business planning process, which results in the “cannonball” being fired on launch day, they support the idea of making small inexpensive tests about the business model with the actual customersdfiring bullets. These tests create an iterative process where parts of the business model are adjusted from the feedback of the tests until every part of the business model reaches a stage where it has been validated by the customers, i.e., the company has “nailed it.”

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00003-5 Copyright © 2020 Elsevier Ltd. All rights reserved.

42

3.1.1

Start-Up Creation

How to be a successful start-up

Starting a new businessdas a new firm or inside an existing firmdhas always been difficult and with a high risk of failure, but these days when you often have to start on a global scale, it is even more complicated. The main idea of the emerging LS paradigm is to provide new businesses with some tools for a more successful start-up. From several studies and extensive research, it has been well-documented that most start-ups fail. The risk of starting a new enterprise is high, especially if it is combined with the development of a new technological product that has to be commercialized and scaled after the final business model has been developed. The lean approach can help start-ups in testing new ideas and getting customer feedback in a way that enhances the market success of their new products (Blank et al., 2013; Blank, 2007, 2011, 2013; Ries, 2011, 2017; Nir, 2018; Ries and Euchner, 2013). When launching new products or starting new companies, a piece of general advice taught in business schools around the world is to write a solid business plan, and this process is considered as one of the best methods for securing a successful launch. The traditional business plan describes relevant information to the planning process such as resources, assets, strategy, competitors, and market-related factors. The plan is intended to cover all available information that can contribute to making the right choices for the business model as well as estimating future revenue. In short, business planning typically starts with the identification of an opportunity, followed by the development of specifications, building the product, and finally selling it. The reasoning logic behind this model is that it is possible to make reasonable predictions about the customers’ wants and thereby understand how a given product will be positioned in the customers’ minds as well as how the new product will perform in the marketplace. Often this approach follows what is called a waterfall process; assuming that it is possible to make precise predictions, the product development is conducted as a step-by-step process leading to the final product launch. Although business plans have become a tool that is deeply rooted in entrepreneurial practices, there is little empirical evidence concluding that writing a business plan increases the chances of start-up success. The business planning process requires a deep understanding of the market place as well as the customers to be able to make precise predictions that can be applied in the planning. For an established and experienced company with large amounts of historical data on how past products have performed as well as extensive knowledge about their target customers, the writing of business plans can be beneficial. With a plan based on reliable data, the odds of having made reasonable predictions increase, and the company can efficiently allocate the right resources to the different steps in the plan, effectively leading to an efficient and controlled process (Furr and Ahlstrom, 2011). Planning and forecasting, however, are only accurate when based on a long, stable operating history and a relatively stable environment, which is not the case of a startup. Most often, start-ups do not yet know who their customer is or what their product should be. Combined with the fact that the world becomes more uncertain, it gets harder and harder to predict the future, and the traditional management techniques are no longer up to the task (Ries, 2011, 2017; Nir, 2018).

Lean startup

43

These facts have ignited the discussion of whether business planning is the optimal tool for navigating a start-up. Steve Blank (2013) criticizes the use of business planning for start-ups because “start-ups are not just a small version of large companies.” While mature companies execute on a proven business model, start-ups are searching for a viable business model as entrepreneurs start with a guess at the right problem and solution. This means that instead of executing, entrepreneurs must search for the right problem and solution. Start-ups face high uncertainty, and the absence of a business plan can be economically reasonable. The start-up does not have to spend extensive resources on planning and does not risk spending resources on some part of the plan that is based on assumptions that might prove wrong. In the best scenario, the resources will be wasted, but even worse the plan could result in cognitive limitations making the entrepreneur too focused on executing the wrong plan instead of searching for other solutions.

3.1.2

What is lean in a lean start-up?

Eisenmann et al. (2012) defined, from the work of Ries (2011), LS as a firm that follows a hypothesis-driven approach to evaluate an entrepreneurial opportunity and develop a new product for a specific market niche. LS can also be seen as “getting out of the building” (Blank, 2013) or as a process of validated learning about the needs and behaviors of real-world customers (Ries, 2011; Ries and Euchner, 2013). The LS methodology focuses on translating a specific entrepreneurial vision into falsifiable hypotheses regarding the new product as part of an emerging business model that is going to be used to deliver it. The hypotheses are then tested using a series of well-thought prototypes that are designed to validate specific product features or business model specifications. In this context, the entrepreneurial opportunity is based on shaping the new solution in a way that could solve a specific customer problem. The uniqueness of the methodology consists in its ability to explicitly take into account the numerous uncertainties regarding the suitability of a given solution toward a specific customer problem. In recent years, a wide array of authors has contributed to evolving the method by giving their take on the matter. Originally, the methodology was developed with hightech companies in mind but has since been expanded to apply to a broader category of companies looking to introduce new products to the market. Steve Blank’s introduction to the customer development process launched the LS movement (Blank, 2007). He was the first to describe how entrepreneurs should test and refine business hypothesis through customer validation. “The Startup Owner’s Manual” (Blank and Dorf, 2012) describes a step-by-step process for managing the search for a new business model and provides entrepreneurs with a path from idea to a scalable business model. Eric Ries continued the work of Steve Blank. After being involved in several startups, Ries started to wonder why they were failing despite doing everything right in the traditional ways. He decided to try a different approach inspired by Steve Blank’s Customer Development, and the core idea was that the business and marketing functions of a start-up should be considered as necessary as engineering and product

44

Start-Up Creation

development and therefore deserves an equally rigorous methodology (Ries, 2011). Measured against the traditional theories on product development, Ries’ new ideas did not make sense, although it seemed they had a very positive influence on the performance of the start-ups. To describe his new ideas, he used the term “lean” from lean manufacturing to emphasize the core idea behind the methodologydto eliminate the waste, the non-value-creating efforts, that he saw in start-ups around him building products that nobody wanted. After refining and developing his theories with other start-ups, writers, and thinkers, Ries published his book “The Lean Startup” in 2011. Two other prominent contributors to the LSM are Nathan Furr and Paul Ahlstrom, with their book “Nail It then Scale It” (Furr and Ahlstrom, 2011). Both authors have been involved in multiple start-ups. By observing both failures and successes, they started to see a pattern, which came to serve as the foundation of their book. They suggest a three-step process where the entrepreneur starts with a hypothesis about customer pain and then test it. Once the customer pain has been identified and validated, a hypothesis about the minimum feature set necessary to drive a customer purchase should be made. From there, a series of gradually more advanced prototypes should be built, while discussing and validating with customers each step of the way. Eventually, the solution to the customer pain will be “nailed” and the start-up can start developing a go-to-market strategy and scaling the business. In recent years, other authors have been publishing their refinements of the original methodology by focusing on two different aspects. The first aspect is the operationalization of the LS approach with a focus on start-ups. The most valuable example in this direction is the book “Running Lean” by Ash Maurya (2012), which has received much attention. The second aspect is the extension of the LS methodology to a broader context, including the management of new product ideation, design, development, and commercialization in established firms. Examples of books focusing on this aspect are Scott Anthony’s “The First Mile: A Launch Manual for Getting Great Ideas into the Market” (Anthony, 2014), Nathan Furr and Jeff Dyer’s “The Innovator’s Method: Bringing the Lean Startup Into Your Organization” (Furr et al., 2014), and Remy Arteaga and Joanne Hyland’s “Pivot: How Top Entrepreneurs Adapt and Change Course to Find Ultimate Success” (Arteaga and Hyland, 2013). A newer approach is the book “The Pragmatist’s Guide to Corporate Lean Strategy: Incorporating Lean Startup and Lean Enterprise Practices in Your Business” (Nir, 2018) that is an attempt to introduce LS practice into corporate strategies, especially in software development. This book can be seen as a follow-up to the book “The Startup Way: How Modern Companies Use Entrepreneurial Management to Transform Culture and Drive Long-Term Growth” (Ries, 2017), which has much of the same perspective.

3.1.3

The link to the business model idea

The articulation of the LS approach was complemented by the adoption of the Business Model Canvas (BMC)1 approach (Osterwalder and Pigneur, 2010) to form the 1

http://www.businessmodelgeneration.com/canvas/bmc.

Lean startup

45

basis for its conceptual “status quo.” The BMC is a visual chart including nine elements (building blocks) describing a firm’s value proposition, infrastructure, customers, and finances. It assists firms in aligning their activities by illustrating all potential trade-offs and evolving their initial vision into a refined operating business model. The BMC was not explicitly developed for start-ups but was later adopted by the LS community as a critical reference model. The purpose of the model is not to fix or codify the initial entrepreneurial vision but to provide a tool for its continuous refinement. One of the key benefits of the model is the possibility to be adapted to a specific business context, industry sector, technological domain, and particular firm’s circumstances. It is not by accident that the BMC was creatively modified by other authors resulting into several different versions: the Lean Canvas2 suggested by Maurya (2012) as an adaptation of the BMC to the context of LSs, the Business Model Snapshot suggested by Furr et al. (2014) as a more straightforward and more intuitive version of the BMC, the Big Idea Canvas suggested by Paul Ahlstrom as a practical tool helping the adoption of the “Nail It and Scale It” process (Furr and Ahlstrom, 2011).3 More details about some of the canvas approaches can be found in Chapter 2 of the present book.

3.2 3.2.1

The main elements of lean start-ups Overview of key elements

The LS process of validation was described initially by Steve Blank (Blank, 2007, 2011, 2012, 2013; Blank et al., 2013; Blank and Dorf, 2012) through the introduction of a Customer Development Model (CDM). Ries later popularized it through the articulation of several fundamental paradigmatic principles as part of a buildemeasuree learn (BML-loop) framework, which was described in his book “The Lean Startup” (Ries, 2011). The emergence of the LS approach is based on Blank’s and Ries’ study of successful entrepreneurs who tended to follow the CDM model in new product development and commercialization instead of a purely product-centric development model. According to Blank (2013), one of the key starting points is to emphasize that a start-up is not a smaller version of a large company, but “a temporary organization designed to search for a repeatable and scalable business model.” Ries (2011) pointed to another critical aspect of the LS by defining it as “a human institution designed to create new products and services under conditions of extreme uncertainty.” The LS approach favors experimentation over planning, customer feedback over intuition, and iterative design over traditional business planning (Blank, 2013; Blank and Dorf, 2012). The focus on experimentation as a source of customer knowledge is associated with the concept of minimum viable product (MVP). This is a product or a 2 3

http://leanstack.com/lean-canvas/. https://www.bigideacanvas.com/.

46

Start-Up Creation

service consisting of a minimum set of features that are used, first, as a tactic to reduce wasted engineering hours and financial resources; second, as a specific commercialization strategy bringing the product to the hands of early and visionary customers as soon as possible; and third, as a specific approach to product codevelopment with customers by looking for quick adjustments of the initial product feature set to align in real time with specific customer needs. The MVP approach seeks to validate as many assumptions as possible about the viability of the final product before using extensive financial resources. In addition, the new venture may adjust its course in a way that may involve pivoting from the original agenda. The MVP concept is the basis for another difference of LSs as compared to traditional onesdthe need for the adoption of success metrics tolerating experimentation and productive failure.

3.2.2

Customer feedback

One of the most emphasized principles of LS is to get out of the building to learn from potential customers. As Blank and Dorf (2012) state it, “there are no facts inside the building, so get the heck outside,” implying that the facts a start-up needs to gather about customers, markets, suppliers, and channels exist only “outside the building.” According to Furr and Ahlstrom (2011), 90% of businesses fail because the start-up could not get anyone to buy it, not because they could not build it. A deep understanding of customers is thus crucial in the development of new products and services and the establishment of a new business model for a start-up. The way LS measures progress is through validated learning. Validated learning is the process of demonstrating empirically that the start-up has discovered valuable truths about its present and future customers. Ries (2011) states that it is much more accurate and faster than traditional market forecasting or traditional business planning. It is the answer to the problem of “achieving failure” by successfully executing a plan that leads nowhere. The entrepreneur should develop an attitude to learning that enables the start-up to spot new opportunities and understand how a different business model might bring more value to the customers. In the words of Furr and Ahlstrom (2011), the entrepreneurs should “maintain a seed of doubt that they may be wrong.”

3.2.3

Big design or iterative designdpivot or persevere

If the assumptions tested with the customers turn out to be incorrect, the entrepreneur should be ready to make a fundamental pivot. Ries (2011) describes the pivot as “a structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth.” The point of the pivot is to realize when the initial assumptions about some parts of the business model are wrong to avoid spending excess resources on moving the company in the wrong direction (Blank and Dorf, 2012). The MVPs a start-up builds can be seen as experiments to learn about how to build a sustainable business. The purpose of the start-up ought to be learning what the customer wants rather than proving that the traditional business plan holds. This reframing is the first step to shred the learning traps holding many entrepreneurs

Lean startup

47

back. Ries (2011) suggests a tool to facilitate this learning process described by the BML feedback loop. Through testing initial MVPs with the customers, their feedback should result in changes that steer the start-up in the right direction (Blank and Dorf, 2012). By continuously going through the loop and iterating rapidly, the start-up is making incremental progress in their business model to target their customers in the right ways and thereby increasing the odds of success. The entrepreneur will, at the same time, be facing the most challenging questiondwhether to pivot the original strategy or stick to the original strategy. The answer to this question will, in part, be gauged by the metrics used by the start-up to evaluate the customer response.

3.2.4

Business planning or hypothesis testing

Standard accounting does not help evaluate start-ups. Start-ups are too unpredictable for forecasts and milestones but should instead be evaluated on other measures. Start-up metrics focus on tracking the start-ups’ progress in converting guesses and hypotheses into incontrovertible facts rather than measuring the execution of a static business plan. It is critical that management continuously tests and measures each hypothesis until the entire business model is worth scaling into a company (Blank and Dorf, 2012). The first MVP should be used to establish a baseline for different assumptions. When choosing among which metrics to focus on, the ones best describing the riskiest assumptions should be chosen (Ries, 2011). By focusing on the right metrics, the entrepreneur will be able to cut through all the noise involved with launching a new product (Furr and Ahlstrom, 2011). After the baseline metrics have been chosen, they should then be used to evaluate new changes in the business model. Once the baseline has been established, the start-up can work toward the second learning milestone by targeting every product development, marketing, or other initiatives at improving one of these metrics. Premature scaling is thought of as one of the significant causes of start-up failure. Premature scaling means “turning on the engine of growth” by hiring salespeople, setting up production facilities, or building offices before the business model has been validated in the market place. Furr and Ahlstrom (2011) argue that before the start-up has proven the sustainability of their business model, defined as reaching the product/market fit, it should stay in the iterative process of improving and testing the business model.

3.3

The fundamental concepts of lean start-ups

Although the authors that represent the LS methodology share their views to a large extent, there are differences in the process they suggest start-ups should adopt. The chosen authors all agree that the first phase of a start-up should focus on understanding the problems the customers are facing. From this understanding, an MVP should be based on customer requirements. Ries (2011) emphasizes building an MVP targeted at early adopters and then going through the BML-loop to refine the product until

48

Start-Up Creation

the start-up metrics suggest the business is ready to be scaled. Blank and Dorf (2012) propose a more rigid approach inspired by the book Business Model Generation (Osterwalder and Pigneur, 2010). They define a business model by nine building blocks. Following the LS methodology, the most critical hypothesis for success of the business should be tested first. As the product is validated and refined by customer feedback, the next and less critical building blocks are tested until the business model is fully validated and can move to the phase of scaling. Blank and Dorf (2012) and Furr and Ahlstrom (2011) also follow a step-by-step process. After the first phase of interviewing customers about the problem, a virtual prototype should be developed to test the solution hypothesis. When these have been validated and refined, the start-up should build a prototype to test price point. From there, the start-up should launch the product to test the remaining parts of the business model. Once every part of the business model has been validated and indicates that the start-up has found a sustainable business model, it should move to the phase of scaling the company.

3.3.1

Minimum viable productsddo we have a problem worth solving?

As seen in Fig. 3.1, the LS process begins with the formulation of working hypotheses that later will be tested through conversations with customers. The first phase of the process includes the creation of problem and solution hypotheses, contacting customers and scheduling interviews, validating hypotheses, and an exploration of the market attractiveness. The start-up must first figure out which customers to listen to as well as finding specific questions to investigate. Although using different terms, (Blank and Dorf, 2012; Furr and Ahlstrom, 2011; Ries, 2011) agree that the initial hypotheses should seek to investigate the problem the customers are facing and then testing the proposed solution to this problem.

Create and validate the problem hypothesis

Creation of initial hypothesis Contact and schedule interviews Validating hypotheses Exploration of market attractiveness

Create and validate the solution Develop the minimum set hypothesis Develop the MVP Test and modify the solution Go-to market strategy

Figure 3.1 Overview of the lean start-up process.

Validate the business model and scale it

Lean startup

49

This can be seen as the problem and the solution hypotheses. The problem hypothesis should be created to determine whether a problem worth solving exists, identify early adopters, and learning how customers currently solve these problems. After understanding the problem, the start-up should develop a solution hypothesis stating the problem should be solved. This hypothesis can be tested by merely describing it to potential customers and asking whether something like that would solve their problem. This could be a virtual prototype or a PowerPoint presentation of the solution used to qualitatively validate the hypothesis, or it could be setting up a webpage for quantitative validation. Measuring metrics from this should give some indication of whether the right solution to the problem has been found. Although the initial hypotheses should seek to investigate whether a market for a given product is present at all and gain a deep understanding of the way the customers perceive the problem, the start-up should also have the big idea hypothesis in mind (Ries, 2011). The big idea hypothesis represents an idea of how a possible solution to the customer pain should look and how it should be delivered. However, in the first phase, this idea should be left on the paper to make sure that the entrepreneur remains an open state of mind and can accurately listen to the customers, thereby establishing the right solution for the future product. Once the problem and solution hypotheses have been formulated, it is time to test them. Before they are validated in the marketplace, they are nothing but an educated guess. Again, at this step, it should be remembered not to waste too much time and resources only to discover that the assumptions were wrong. The goal is, therefore, to quickly get in contact with customers to test the hypothesis, measure the results, and objectively determine if they were right. Of course, it is essential to contact the right customers. The customers should, in some way, feel the pain the solution is trying to solve. Different segments might have different perceptions of the intensity of pain they have in the given area. In the first round of customers, contacting the segment with the highest pain level should be chosen. Methods of contacting customers include cold calling, people within the founders’ network, or leads collected from the webpage. When in contact with first customers, it is crucial not just asking the customers what they want but to gain a deep understanding of their motivations, needs, and the problem they want to be solved (Furr and Ahlstrom, 2011). The focus should be on listening and learning and not trying to sell a product. Instead of presenting the hypothesis and asking the customers if they agree, the customers should be asked open questions. From their answers, it should be possible to evaluate the hypothesis qualitatively remembering not to draw conclusions from single customers and considering the type of customer who answers. To decrease the probability of making wrong conclusions, the process should accurately capture the data in the interview by continuously taking notes or recording the conversations. In addition to qualitative customer feedback, the start-up could use a webpage as a way of testing the hypothesis quantitatively. By describing the problem as well as how the entrepreneur intends to solve it on the webpage, the response could be used to evaluate the hypotheses. Furr and Ahlstrom (2011) set a cutoff point at 50%; if 50% respond positively to having the problem and the purposed solution, the start-up can

50

Start-Up Creation

move to the next phase of creating an MVP. However, if the response rate is lower, the entrepreneur should first consider if the right customer segment was chosen as well as whether the hypothesis was stated right. If none of these are the case, the entrepreneur should use the cues from the customer feedback to reformulate the hypothesis and test again. In addition to primary research with customers, secondary materials such as reports, analyses, and other published material should be included to gain a deeper understanding of customer pain. This will help evaluate the competitive environment and the health of the industry the start-up is trying to enter. Also, it could provide valuable information on areas that need further testing. Often customers do have significant pains or desires, but if the market is not large enough or has too many entrenched competitors, the chances of launching a new product are problematic. From talking to the potential customers, the entrepreneur should have an idea of which segments and which markets the product is targeting. Blank and Dorf (2012) and Furr and Ahlstrom (2011) argue for the importance of retrieving market information. The identified segments and markets should be analyzed to understand the dynamics, competition, and the potential of the product. Only if a big enough customer base is evident to justify the needed investments, the start-up should move to the next phase. Ries (2011), however, warns about using too many resources on market research in this early phase, as answers to other questions are more important. The company is ready to move to the next phase once there is a clear understanding of which problem the start-up is trying to solve as well as which customers face the problem and how high they perceive it on the pain scale. It should also be known how customers are currently dealing with the problem, understand the competitive dynamics, and have well-documented reasons to believe that the solution is attractive enough to make a viable business in the long run.

3.3.2

Pivotingdhave we built something people want?

After completing the first phase, the start-up ought to have a deep understanding of the problem it is trying to solve and some ideas of which customers are facing this problem. In other words, the problem and solution hypotheses should have been validated, and there should be reason to believe that a viable market exists for the product. Where the previous phase tested the customer problem or need and explored the customers’ passion for it, the next phase tests whether the solution to the problemdthe value propositiondgets the customers enthusiastic enough to buy and use the. To get more detailed information about the solution, the next step is to create a minimum feature set before building the first MVP. The first MVP should contain only the minimum features required to drive customer purchases. To identify these, the start-up should review the feedback from the first phase and look for the features repeatedly mentioned as “must-haves” during the customer interviews. By focusing on a simple product, the start-up both makes it easier for the customer to evaluate the core value proposition and it makes the start-up able to move much faster with fewer resources. This makes it easier to get fast to the market and gain new feedback, which in turn gives information and time to refine the product.

Lean startup

51

An MVP helps start-ups to start the process of learning as early as possible. Contrary to traditional product development, which usually involves a long process and strives for product perfection, the goal of the MVP is to begin the process of learning. Also, the point is to find an inexpensive MVP because “no business model survives the first contact with customers” (Blank and Dorf, 2012). By not spending excess resources on the MVP, the start-up should have enough money left over to try their “second idea” (Furr and Ahlstrom, 2011). As long as the entrepreneur has nothing but an educated guess about the customer, the focus should be on rapid, inexpensive, and simple experiments. This focus should be directly applied to the development of MVPs. The first MVP should be only complex enough to be able to test the initial hypotheses about the customer; different methods can be used. By reviewing the collected customer feedback coupled with the industry and competitive research, the solution and business model should be discussed. Combined with the chosen minimum feature set, the entrepreneur should arrive at new hypotheses about the needed product specs, customer segments, channels, pricing, and revenue model (Blank and Dorf, 2012). These hypotheses should lay the foundation for the first MVP. While Ries (2011) suggests starting with an actual physical product, Blank and Dorf (2012) and Furr and Ahlstrom (2011) argue that even simpler alternatives could be used to gain feedback before building an actual product. These include setting up a webpage to test customer interest or a virtual presentation of the proposed solution. Unlike when testing a traditional prototype, the idea is not just to test the product’s design or technical questions but rather to test the fundamental business hypothesis. As long as the company does not know who the customer is and what the customer needs, they are not able to define the right quality. This implies that the MVP might have flaws and sometimes be perceived as a low-quality product by the test customers. However, the point is not to build a perfect product from the beginning but rather to learn which attributes the customers care about, thereby providing a solid empirical foundation on which to build future products. The initial MVP should thus focus on finding a dominant position with the early adopters before targeting the mainstream market. Building an MVP is not without risks. The start-up has to be aware of patent protection as well as the danger of established companies stealing the idea. However, as Ries (2011) states, “if a competitor can out-execute a start-up once the idea is known, the start-up is doomed anyway.” The exact idea behind the iterative MVP process is to be able to accelerate faster than anyone else, making it insignificant what the competitors know. Furr and Ahlstrom (2011) state it in this way: “Pursuing a rapid experiment and finding out where you were wrong and changing direction is not failure. It is the road to success.” Another concern is that a poorly designed MVP can damage the brand of the startup and result in negative word-of-mouth. However, this should not be a big concern. However, new product releases in early start-ups rarely draw much attention without a simultaneous marketing campaign. Furthermore, the first MVP is not designed to satisfy the mainstream customer. No start-up can afford to build a product with every feature the mainstream customer needs all at once. Instead, the successful start-up

52

Start-Up Creation

focuses on building a product aimed at a small group of customers, early adopters, who have bought into the start-up’s vision. These early adopters are characterized by having a problem high on the pain scale and searching actively for a solution as well as having the budget to try new solutions that might aid their problem. However, if the start-up fears negative brand perception, the solution could be to release the product or service under another name. By specifically targeting the early adopters with a simple product, it should be possible to go through a series of iterations in partnership with the customers to perfect the product until the business model has been validated, and mainstream customers can be targeted.

3.3.3

Agile development together with the customers

Once the MVP has been made, it is time to test it with real customers. Almost all LS authors suggest using iterative processes to test and further refine their MVPs. Ries (2011) illustrates the iterative process with his BML-loop (Fig. 3.2). In the first phase, “build,” the MVP is developed based on the problem and solution hypotheses. In the next phase, “measure,” the entrepreneur seeks customer feedback, which is then analyzed in the last phase, “learn,” and used to refine the solution in the subsequent build phase. As a start, there should be some ideas about the market and the applications and where the customers feel a problem that the start-up can solve. These customers often represent more than one group or segment. To figure out which group to target first, the profile of each segment should be considered. Although a given segment might suggest having the most extensive reach and the most significant potential, it should only be targeted in the early stages of development if the customers in the segment have the characteristics of early adopters.

Build

Learn

Measure

Figure 3.2 The buildemeasureelearn loop. Adapted from Ries, E., 2011. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. Crown Business, New York.

Lean startup

53

When these customers have had the opportunity to test the product, they should directly be engaged in dialogue with the start-up. During this, the start-up should try to look at the product from the customers’ perspective and make them feel that their feedback is truly appreciated. Again, the focus should not be on selling because that might distort the ability to pick up on cues the customers are providing. The LS authors advocate different methods of evaluating customer responses. Blank and Dorf (2012) and Furr and Ahlstrom (2011) argue that the entrepreneur first should seek to validate the solution qualitatively and then verify it quantitatively. The reasoning for this sequence is that qualitative customer feedback is superior when little is known about the perception of the solution in the customers’ minds. A dialogue with the potential customers about their experience with the proposed solution makes it possible for the start-up to answer the pivot question. If the feedback is sufficiently positive, the entrepreneur should refine the solution based on the feedback and test it again. Once the customers start to validate the solution, quantitative measures should be implemented to try to verify the customer hypotheses on a larger scale. These quantitative measures are termed start-up metrics as they differ from more traditional accounting metrics. Income statements, balance sheets, and cash flows are great at monitoring a company’s financial health when executing on a proven business model. However, they do not provide insights into whether the chosen business model is viable. Start-up metrics can include cost of customer acquisition and retention rate. By analyzing such metrics, the start-up will be able to make decisions about whether the current business model will prove viable. In contrast to this, Ries (2011) proposes to implement quantitative measures as early as possible in addition to the qualitative feedback. Ries does not only use start-up metrics to answer questions concerning the viability of the business model but also to evaluate each incremental refinement of the solution and to make decisions on whether to pivot or proceed. He argues that these metrics should seek to establish a baseline for the riskiest assumptions that the business model resides upon. After analyzing the metrics along with the qualitative feedback in the learning phase, the entrepreneur should decide whether to pivot or proceed. If the refinement of the solution in the building phase does not result in a satisfying improvement on the chosen metrics, the entrepreneur should consider a pivot. If the entrepreneur decides to pivot, it is vital for the entrepreneur to use the experience received in previous steps when finding a new approach to the problem. The start-up should strive to reuse the validated learning from the customers and try to change. Before moving to the next phase, management should be confident that they have found the right solution to an urgent problem, which a large enough number of customers are willing to pay for. Also, they should understand the demographics and archetypes of the target customers and know enough about their behavior to reach them cost-effectively. At last, they should have validated the revenue model, including market size estimates, production costs, and customer acquisition costs.

54

3.3.4

Start-Up Creation

Searching for a business planddo we have the right business model?

After having verified the solution on a small scale, the next step in the process is to launch the product. This step is the most critical phase of the LS, where the start-up determines whether there is a scalable, profitable business model ahead. It is time to evaluate if the company is ready to start spending money to scale and if that the result will be a profitable company. Often it becomes clear for the start-up company that there is a market but that this market is global and that the product launch has to be at many markets at the same time (Tanev et al., 2015). The entire business model is now tested and not its components as in the prior phases. This does not mean going into full execution mode as the viability of the business model is not yet validated, and a large number of aspects still need to be defined as, e.g., a global strategy. The start-up has up to this point done a great deal to uncover and test the initial hypotheses about the problem, the solution, potential marketing channels, and the general understanding of the market. The company is now acting on data about the customers. It is now time to launch the product and test the remaining hypotheses about the business model in a vigorous way. Primarily, financial metrics have to be validated while seeking to improve the baseline metrics established in an earlier phase. The financial model will, of course, be one of the last hypothesis testing activities before launching the business in full force. The financial model includes metrics such as fixed versus variable costs, margins, customer acquisition costs, customer lifetime value, and break-even. Although this process focuses on collecting the relevant quantitative data about the financial model of the start-up, this does not entail ending the iterative process of refining the current solution, and the work on the most critical areas of the business model will continue. This iterative process of refining the solution will continue until all the data indicate that the business model is viable and is ready to be scaled into a larger company. Another vital point to consider is break-even or the point where the revenue matches the expenses. Combined with the current cash burn rate, the entrepreneur will know how many months’ worth of cash is left. Furr and Ahlstrom (2011) suggest that the start-up should have at least double the amount of cash that the entrepreneur estimates to use before reaching break-even. Before this, the positioning and unique value proposition have been tailored from the customer feedback without much consideration given to competition or market type. Before the start-up can start scaling the company, they must address these areas strategically. The market type and competitive environment have a considerable influence on both the investment needed to enter the market as well as the chances of success. If facing a market with a clear market leader, a superior product will not be enough to win the battle, but a marketing budget multiple times that of the marketing leader will be needed. Most start-ups do not have access to those financial resources. Therefore, the entrepreneur should consider resegmenting the market or creating a new market where the product can gain a unique and substantially different position. The strategic decisions made by the start-up are interrelated with the evaluation of the financial metrics. Targeting a large market entails a more considerable potential

Lean startup

55

compared to targeting a small niche market. However, if a few active players dominate the broad market, the cost of customer acquisition will, in many instances, be very high. Such a choice will only be possible if the start-up has adequate funding to support the massive investment needed to reach break-even.

3.3.5

How to find or create the next customersdscaling

The start-up will now have found a scalable and repeatable business model that predictably generates revenue and should be moving full scale into growing the business. As a company grows, a shift occurs away from facing an unknown problem/solution, which requires the iterative search-oriented approach to facing a known problem/solution that requires execution. In other words, the company’s focus changes from customer learning to more traditional measures such as deadlines and quality standards. As a result, the start-up must transition the way it operates fundamentally to reach the next level. Overall, Furr and Ahlstrom (2011) argue that three areas of the company should be addressed: (1) market, (2) process, and (3) team transition. As a start-up begins to scale, they often have early success, followed by a period of stagnant growth. This process is often described by the Technology Adoption Life Cycle model suggested by Moore (1991) (Fig. 3.3). This adoption gap emerging between the visionaries and the pragmatists is often named “the chasm.” The start-up will reach this period once the early adopters have started to use the product, but the mainstream customers are still waiting to adopt. If the start-up is not prepared to handle this phase in advance, they risk continuing to burn cash on a strategy that does not target the mainstream customers accurately. In short, to cross the chasm, the start-up must adjust its value proposition not only to meet the needs of the early adopters but also to reach the additional needs of the mainstream customers. In the words of the LS, this implies to move away from the simple MVP to a full product solution. One of the major tasks now for the start-up is to begin scaling the company’s processes. The customer base is growing, and the focus has to change to serve these

Technology adoption life cycle model Mainstream market

Early Chasm market

Visionaries

Pragmatists

Conservatives

Skeptics

(Early adopters)

(Early majority)

(Late majority)

(Laggards)

Figure 3.3 Technology adoption life cycle. Adapted from Moore, G.A., 2014/1991. Crossing the Chasm: Marketing and Selling Disruptive Products to Mainstream Customers. HarperCollins.

56

Start-Up Creation

customers, too. The company must, therefore, turn most of its activities into repeatable processes as, e.g., an automated logistical setup to ensure satisfying and consistent delivery times. As the start-up starts growing, it will need to hire new employees to handle the increasing workload. This growth will entail new requirements for the organization and individual team members. A more formal organizational chart will be needed to ensure effective communication as well as an increased focus on how to manage the communication, and more specific areas of responsibility will be needed for each employee. All of these changes will require a different skill set from the employees. Not only will more specialized talent be hired for specific areas such as production optimization or sales but also the management will need abilities to facilitate these changes and manage a large organization. In many cases, this will imply that the founder is no longer the best-suited candidate to lead the company (Furr and Ahlstrom, 2011).

3.4

Some examples of lean processes

The reader may find several examples of LSs on Eric Ries’ website, http:// theleanstartup.com/casestudies, including Dropbox, Wealthfront, Grockit, Imvu, Votizen, Aardvark. Just as an example, once Drew Houston, the CEO and Founder of Dropbox, discovered Eric Ries’ Lean Startup blog, the company started iterating their product much faster to test what customers really wanted, early and often. Using Lean Startup principles, in just 15 months, Dropbox went from 100,000 registered users to over 4,000,000.4

3.5

Conclusion and future trends

Many of the LS companies face other problems than “developing” a new product or a new service. In many cases, this has to be done on a global scale, too, with all the problems a fast internationalization may entail. In the blog of Steve Blank, this problem was introduced with the slogan “Born global or die local.” A large number of LS firms are facing the problem of very small home market and thus have to see market opportunities in broader markets all over the world right from the beginning.

3.5.1

Lean and global

Being a global company right from the foundation is often described as being “Born Global” (BG) or as being an “International New Venture” (INV). Combining BG and INV with the LS approach leads to a type of company that has been labeled as LGS, which stands for lean and global start-ups (Tanev, 2012; Tanev et al., 2015; Schrage, 2016). This type of firm is a new technology start-up that has to deal with business 4

http://theleanstartup.com/casestudies#dropbox.

Lean startup

57

development, innovation, and early internationalization not as processes separated in time or functions but as one process leading to an achievable business model that operates on global scale. The complexity, uncertainty, and the risk of being highly innovative and global at the same time are of course high but as shown in the first empirical studies companies deal with these problems by being very disciplined in their development process by following the LS approach (Tanev et al., 2015). The analysis in Tanev et al. (2015) showed that it is essential to distinguish between the upstream and downstream global resourcesda distinction without which it is impossible to conceptualize the early internationalization of the LGS type of firms. LGS firms have had problems dealing with the complexity, uncertainties, and risks of being innovative on a global scale. Some of the specific ways of addressing these problems include a disciplined knowledge and IP protection strategy, the efficient use of business support and public funding mechanisms, and pivoting around the ways of delivering a value proposition and not around the value proposition itself. Besides, all the firms have managed the different types of uncertainties by moving one step at a time in a way that they could maximize the value of newly emerging relationships. As markets are getting more and more global together with both downstream and upstream relations and activities, the LGS firm must be expected to become a common new firm type in the years to come. It will thus be necessary for new firms to be able to deal with innovation and internationalization at the same time as part of one integrated process.

3.5.2

Further reading and links

The classical books and articles about LSs are Blank (2013), Blank et al. (2013), Hart (2012), and Ries (2011), which can be supplemented with Blank (2007), Blank and Dorf (2012), Furr and Ahlstrom (2011), Hart (2012), Miski (2014), and Moogk (2012).

Web resources The classical start: http://theleanstartup.com/ A lean start-up site addressing a broader community: http://www.leanstartupcircle.com/ Steve Blank’s blog: http://steveblank.com/ Ash Mauria’s website: http://leanstack.com/ Disruptive entrepreneurs: An interview with Eric Ries, McKinsey & Company: http://www. mckinsey.com/Insights/High_Tech_Telecoms_Internet/Disruptive_entrepreneurs_An_ interview_with_Eric_Ries

References Anthony, S.D., 2014. The First Mile: A Launch Manual for Getting Great Ideas into the Market. Harvard Business Review Press, Boston, Massachusetts. Arteaga, R., Hyland, J., 2013. Pivot: How Top Entrepreneurs Adapt and Change Course to Find Ultimate Success. Wiley.

58

Start-Up Creation

Blank, S., 2007. The Four Steps to the Epiphany e Successful Strategies for Products that Win. Quad/Graphics. Blank, S., 2011. Embrace failure to start up success. Nature 477, 133e133. Blank, S., 2012. Where the Next Big Thing Lives in Our Nation’s Research Labs. Hard Part: Turning Scientists into Entrepreneurs. Mansueto Ventures LLC on behalf of Inc. Blank, S., 2013. Why the lean start-up changes everything. Harvard Business Review 1e9. Blank, S., Benjamin, S., Turner, E., Eisenberg, I., Warren, H., Telleen-Lawton, D., Guido Hassin, B., 2013. “Lean” is shaking up the entrepreneurial landscape: interaction. Harvard Business Review 91, 14e15. Blank, S.G., Dorf, B., 2012. The Startup Owner’s Manual: The Step-by-step Guide for Building a Great Company. K&S Ranch Incorporated, Pescadero, CA. Collins, J., Hansen, M.T., 2011. Great by Choice: Uncertainty, Chaos and Luck - Why Some Thrive Despite Them All. Random House. Eisenmann, T., Ries, E., Dillard, S., 2012. Hypothesis-Driven Entrepreneurship: The Lean Startup. Harvard Business School Entrepreneurial Management Case. Furr, N., Ahlstrom, P., 2011. Nail it Then Scale it: The Entrepreneur’s Guide to Creating and Managing Breaththrough Innovation. Furr, N., Dyer, J., Christensen, C.M., 2014. The Innovator’s Method: Bringing the Lean Startup into Your Organization. Harvard Business Review Press. Hart, M.A., 2012. The lean startup: how today’s entrepreneurs use continuous innovation to create radically successful businesses. Journal of Product Innovation Management 29, 508e509. Maurya, A., 2012. Running Lean: Iterate from Plan A to a Plan that Works. O’Reilly Media, Incorporated, Sebastopol, CA. Miski, A., 2014. Development of a mobile application using a lean startup methodology. International Journal of Scientific and Engineering Research 5, 1743e1748. Moogk, D.R., 2012. Minimum viable product and the importance of experimentation in technology startups. Technology Innovation Management Review 23e26. Moore, G.A., 2014/1991. Crossing the Chasm: Marketing and Selling Disruptive Products to Mainstream Customers. HarperCollins. Nir, M., 2018. The Pragmatist’s Guide to Corporate Lean Strategy: Incorporating Lean Startup and Lean Enterprise Practices in Your Business. Apress, Berkeley, CA. Osterwalder, A., Pigneur, Y., 2010. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Wiley-Blackwell, Hoboken, NJ. Ries, E., 2011. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. Crown Business, New York. Ries, E., 2017. The Startup Way: How Modern Companies Use Entrepreneurial Management to Transform Culture and Drive Long-Term Growth. Portfolio Penguin, London. Ries, E., Euchner, J., 2013. What large companies can learn from start-ups. ResearchTechnology Management 56, 12e16. Schrage, M., March 10, 2016. The best entrepreneurs think globally, not just digitally. Harvard Business Review 1e3. Tanev, S., March 2012. Global from the start: the characteristics of born-global firms in the technology sector. Technology Innovation Management Review 5e8. Tanev, S., Rasmussen, E.S., Zijdemans, E., Lemminger, R., Svendsen, L.L., 2015. Lean and global technology start-ups: linking the two research streams. International Journal of Innovation Management 19, 1e41.

Start-up financing Seth C. Oranburg Duquesne University School of Law, Pittsburgh, PA, United States

4.1

4

Introduction

Start-ups are innovative, high-risk, high-growth business ventures that often require a significant amount of external financing (Vaznyte and Andries, 2019). Most start-ups “bootstrap,” meaning self-fund in their earliest stages, generally through various creative methods designed to reduce the need for outside financing and to minimize the need for cash (Ye, 2017). In the early stages of a start-up’s life, most entrepreneurs tend to finance their ventures using their personal savings (Aydin, 2015). Many start-ups raise funds through family members and friends, whereas less than 1% of start-ups are funded by venture capital and angel investors. However, these professional investors contribute much more money per financing round, so venture capital and angel funds still represent a significant portion of start-up financing on a per-dollars basis. Bank loans tend to be difficult for start-ups to secure, although the Small Business Associations makes debt financing more feasible. Finally, crowdfunding is a small but fast-growing source of funds. Fig. 4.1 shows the top funding sources in a study by the Center for Venture Research. As Fig. 4.1 makes clear, most start-up funding comes from founders and their family and friends, who contribute an average of about $23,000 each. However, some business models require massive and repeated infusions of millions of dollars, which is only feasible to obtain through venture capital. High-growth start-ups need venture capital like spacecrafts need rocket fuel. Moreover, obtaining funding from outside investors such as venture capital impacts the business model and has legal effects. Accordingly, this chapter will focus on how start-ups are formally financed by outside investors to grow rapidly. Professional investors fund start-ups primarily through the use of debt, equity, or convertible debt (a hybrid of debt and equity) (Deeb, 2014). Crowdfunding is emerging as a new way for start-ups to get outside investments. At the outset, it is important to note that all of these methods may involve the issuance of securities, which are subject to various laws. Engage a competent attorney in any securities issuance because compliance can be tricky and penalties can be harsh. Before a company can issue securities, it should be formed or incorporated. Start-up formation involves two formative decisions that affect financing and have repercussions for the life of the company: In what state should you form or incorporate the company? What type of entity do you want to form there? There are many excellent resources about how to make this critical decisiondand limited liability companies

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00004-7 Copyright © 2020 Elsevier Ltd. All rights reserved.

60

Start-Up Creation

Figure 4.1 Top funding sources for start-ups (Soetanto and Van Geenhuizen, 2015).

are quickly growing in popularitydbut most American entrepreneurs who seek venture capital still choose to form a Delaware corporation. This chapter will, therefore, focus on start-up financing for a Delaware corporation, although it may be helpful to understand the reasons why many entrepreneurs make this choice. Corporations are the most common entity choice for a start-up because the corporate form is well understood, separates ownership and control, limits liability for shareholders and directors, simplifies accounting, can be created quickly and easily, and has many standard characteristics that make it possible to use standard forms to issue securities (Hyman, 2014, x1:1). This is not, however, the only choice. In recent years, many states have authorized the creation of new entity types. The most popular new entity type is the limited liability company, which is lauded for its flexibility and tax benefits (Sargent and Schwidetzky, 2014, x1:1). Flexibility is not always a benefit to start-ups seeking financing because complexity and customization quickly increase legal costs, and investors have to review more information to understand investors’ rights in flexible entities. The tax benefits may also be illusory, as most start-ups lose money for years before they turn a profit. The state of incorporation matters a great deal because the corporate law of the state of incorporation governs the corporation’s internal affairs (such as voting rules and other shareholder protections), and corporations may be sued in their state of incorporation. Most start-ups incorporate in Delaware because Delaware law is generally considered to be the most predictable (Fisch, 2000; Jagannathan and Pritchard, 2017). The Delaware courts are also reputed to be the best in resolving corporate issues quickly and fairly. Some start-ups choose to incorporate in the state in which they do business because this saves costs, but outside investors from other states may be hesitant to invest in entities that could be subject to quirky state laws. Accordingly, this chapter assumes the entrepreneur will form a Delaware corporation, which is widely regarded as the safest choice for a start-up that seeks outside investment, even though there are many good reasons to make other choices. Consult a legal advisor to determine if another entity choice or state of incorporation is better for you.

Start-up financing

4.2 4.2.1

61

Debt financing Introduction

Many entrepreneurs are already familiar with debt financing from their personal life. While debt agreements to borrow money can be very complicated, they have several common and straightforward characteristics. The most essential characteristics of debt financing to many entrepreneurs are, first, that lenders typically do not have rights to tell the entrepreneur how to run the business and, second, failure to make regularly scheduled debt payment can put the start-up into bankruptcy.

4.2.2

Pros and cons

Perhaps the biggest advantage of debt financing is the end of the relationship when the debt is repaid and lenders do not have the right to tell the entrepreneur how to run the business in the meantime (unless such rights are given by contract, which is unusual). This is a pro for the entrepreneur who wants to maintain total control of the start-up. So long as the debt is repaid on time, and as scheduled, the entrepreneur does not have to answer to investors. Doing so can even raise the start-up’s credit rating, making it easier to borrow money in the future. However, early-stage start-ups often have dips in cash flows that make it challenging to make debt payments every month. Moreover, the entrepreneur may prefer to reinvest profits in growing the business, rather than making debt payments. Entrepreneurs may not realize that corporate debt requires regular repayment; severe repercussions can result when payments are missed. When a start-up fails to make a debt payment when it is due, the loan immediately goes into default. However, default for nonpayment is only one of many ways in which a start-up can default on a loan. Commercial debt agreements also have several covenants, which are conditions that must be met while the loan is outstanding. Financial covenants can include a requirement to maintain a minimum level of assets or not to take on more debt. Another con associated with these covenants is that the entrepreneur will have to provide the bank with balance sheets, income statements, and cash flow documents regularly, so the bank can confirm that the financial covenants are not violated (Booth, 2014, Chapter 6). Banks may also ask start-ups to agree to operating activity covenants. These can be unobjectionable, like a requirement to pay taxes and comply with laws and regulations, or they can be onerous, like a prohibition against using company money for a specific purposesdsuch as leasing equipment or real estate, changing management, selling assets, or paying dividendsdwithout bank approval (Booth, 2014, x 6:13). It may feel like there is a banker in the boardroom while the debt is outstanding. Fortunately, not all loans are so burdensome. In fact, another advantage of loans is that there are many products from which to choose. For example, the Small Business Association helps start-ups get commercial loans up to $5 million at reasonably good terms (SBA loans, n.d.). Such loans can have fixed interest rates and long terms, so the monthly payment is low and certain. There is also a new lending industry called

62

Start-Up Creation

peer-to-peer (P2P) lending or crowdfunding, which does not use a traditional bank at all (see Section 4.5). These alternative (nonbank) lenders are important for start-ups because many banks are unlikely to fund a start-up that does not have sufficient collateral to guarantee a loan. Collateral is property of the borrower that can be seized if the borrower does not repay the loan. This is often called a security interest, and it can include cash, real property, and intellectual property. Posting security often helps the borrower obtain a lower interest rate because it makes the loan less risky for the lender, but many early-stage start-ups (and some late-stage ones) lack sufficient collateral for a traditional loan (Bradford, 2012; Lee, 2018).

4.2.3

Issues

There are a number of issues with start-up debt financing, but perhaps the most significant issue is that currently, it is hard for a small business in America to get a loan, especially without collateral. Small business owners generally have difficulty obtaining loans (Chakraborty and Mallick, 2012; Belas et al., 2015). This is particularly problematic for the busy entrepreneur. Filling out each loan application can take hours, and the bank may require days’ worth of follow-up information before denying the loan application. Studies show that the trend away from small business bank lending is unlikely to reverse (Peirce et al., 2014). Fortunately, there are new sources of debt financing that put fewer arduous requirements on start-ups. The new industry of P2P lending has emerged to provide personal and small business loans. Lending Club, Prosper, Realty Mogul, and other companies provide a P2P platform where borrowers and lenders can transact without going through a traditional bank. Each platform has its own methods, but generally, the P2P lending works on a reverse auction model. The start-up creates a profile and submits financial information to the platform, which assigns a credit rating. Then the start-up posts a request on the platform’s website for funds. Lenders view potential borrowers and contribute some fraction of the requested amount. Depending on the attractiveness of the borrower, it may take some time for enough lenders to syndicate and fund the entire loan amount. Typically, the cash is not available to the borrower until the loan is fully funded, so this creates an issue if money is needed urgently. Another issue with P2P lending is that the request for a loan is visible to thousands of people, not just a few banks. Some entrepreneurs may not want to disclose their business model and financial situation so broadly. An analogy may be posting a request for a personal loan to a Facebook page, something which may not be desirable for the entrepreneur. Finally, loan documents, especially ones with security or collateral agreements, are complicated, technical, and hard to read. The loan agreement may set forth a large number of restrictive covenants, and it can be hard to track when they are breached. The risks of default not only for nonpayment of principal and interest but also for technical noncompliance may require the entrepreneur to dedicate substantial efforts to servicing the loan. It is critical to read carefully and fully understand any loan

Start-up financing

63

agreement before signing. If the terms of the loan are so troublesome that they will prevent the business from running properly, it may be best to look for another source of financing.

4.3 4.3.1

Equity financing Introduction

Equity is a share of a business. In fact, equity in corporations is actually called shares or shares of stock. An entrepreneur who raises money through equity financing effectively sells pieces of the company in return for outside investment. The outside investors thereby become inside shareholders, who have certain legal rights and privileges that lenders do not enjoy. Professional equity investors include angels and venture capitalists (Oranburg, 2015a). Angels form groups that collectively invest an average of $350,000 of their own money in a very early-stage start-up, whereas venture capitalists form funds that invest an average of about $7.3 million in a more mature company (Oranburg, 2015a). These independent venture capital (IVC) investors (which may also include private corporations that have venture funds) contribute the vast majority of start-up capital in America and the world, but some countries have established government venture capital (GVC) funds and mixed publiceprivate partnership funds. Public investors provide capital to entrepreneurs that IVC investors may not because GVCs are under political pressure to pursue domestic employment and other nonfinancial goals (Cumming et al., 2017).

4.3.2

Pros and cons

The overwhelming advantage of equity financing for start-ups is that there is no loan that must be paid back. With equity financing, there is no risk of bankruptcy as a result of failing to repay investors. This gives start-ups the flexibility to deploy invested capital in growing the business. Investors do not expect to be repaid until the business becomes profitable, and even then, equity investors may be willing to reinvest the profits to continue growing the business, especially for social reasons (Terziev, 2017). The reason equity investors are so flexible about being repaid is that equity owners are entitled to a share of the total value of the start-up. The investor joins the entrepreneur in sharing business risks by providing risk-bearing capital (Weijs, 2018), and both have similar incentives to grow the business as large as possible before cashing out (Huang and Knight, 2017). This creates a partnership dynamic between the entrepreneur and the equity investor, which may be welcome in some situations, but also one that can create frustrations for the entrepreneur. As a coowner in the business, the equity investor is entitled to vote on fundamental transactions, such as a merger or a sale of substantially all the company’s assets. Once equity investors purchase stock in a start-up, the entrepreneur may lose control over when to liquidate the business and exit the market. In fact, many equity investors

64

Start-Up Creation

will push for an exit within 8e10 years of their initial investment. While the entrepreneur frequently gets paid to operate the business, the equity investors typically get a return on their investment only when it liquidates. Some equity investment contracts even contain a provision where the investors can force the company to go public (Smith, 2005). Another con about equity financing is that the investors typically receive preferred stock, whereas the founders and employees typically receive common stock. Preferred stock is so named because it has certain preferences, including the right to be paid first in a merger or liquidation, the right to receive dividends, and the right to block certain transactions such as another debt or equity financing. Founders need to realize that equity financing not only gives up a share of their business to investors but also subordinates founders’ equity position to investors. The common stockholders usually have financial rights only in the residual, which is the amount that remains after the preferred stockholders are fully paid for their initial investment, dividends they have accumulated, and any liquidation preference they are owed. Preferred stockholders may even have the right to participate, which means that after they receive their preference, the preferred stock converts to common and receives a percentage of the residual as well (Walther, 2014, p. 167). Preferred stockholders lack the affirmative covenants often found in bank loans, but they need a way to make sure that management is acting in the investors’ best interests, so they often bargain for management rights or even a seat on the company’s board. Giving an investor one seat out of three may not seem like a big deal at first, but remember that start-ups often raise multiple rounds of outside investment. Each fundraising round may result in giving up another board seat, so that by the third round the equity investors may outnumber the founders on the board by three to two. At this point, the investors can fire the CEO and replace management. Only the strongest start-up founders are able to raise multiple rounds of equity financing without eventually giving up a majority of board seats to investors. Most founders who raise equity financing should expect to be at the mercy of outside investors at some point in their start-up’s life cycle (Wasserman, 2012). But founders are often overly worried about maintaining control. Equity investors are in the business of selecting and overseeing start-ups in which to invest, not in the business of running them. A good CEO will find his or her position secure, and quite frankly, it may be in everyone’s best interest to replace an underperforming CEO with someone who can really build the business. The original founding team should be vested in most or all of their common stock (meaning they have the right to keep that stock even if they are fired) by the time equity investors control the board, so they can actually profit financially from such a change of control (Empey, n.d.). Sometimes, the founding CEO is a visionary who can build something new, but not an administrator who can run a large and successful organization. This can be hard for a CEO to admit, but successful repeat entrepreneurs learn their own strengths and weaknesses. The close and interdependent relationships between entrepreneurs and investors that arise from equity financing agreements are not for every start-up founder. Those founders who demand complete control may be frustrated when each financing round

Start-up financing

65

slowly drains power from their grasp. But founders who are open-minded about the business model and their role in the company may actually find that equity investors have valuable experience, connections, and skills that can be employed to dramatically improve the business. The key thing to remember when sorting out the pros and cons of equity financing is this: Equity investors are more than money. Equity investors are partners. Some analogize the founder/investor relationship to a marriage. Choose someone you trust and want to work with for many years.

4.3.3

Key issues

The biggest issue with equity financing is that it may not be available during certain stages of start-up development. There are currently two main types of equity financing investors, angels, and venture capitalists. Angels typically fund less than $1,000,000, and venture capitalists typically fund more than $5,000,000, so start-ups trying to raise about $3,000,000 often have trouble attracting investors (Oranburg, 2016). Moreover, these investors prefer business models that can scale quickly, which is why they often invest in software start-ups. Start-ups that make physical goods or that require a large input of human capital may find it difficult to attract equity investors. Fortunately, there are more resources than ever to find angels and venture capitalists who are in specific sectors. Websites such as Angel List connect start-ups to equity investors, incubators, and accelerators have “demo day” to highlight emerging companies, and many large corporations have established venture financing groups to help grow start-ups in their sector (Incubator, n.d.). Start-ups should plan their business model around the realities of equity financing by planning to seek financing at points in the start-up’s life cycle where investment will be at the highest levels. Another issue is that raising money through equity financing requires a public disclosure of the securities issuance. There are websites such as Crunch Base, whose business is to look for filings about such securities issuances and to post that information online (www.crunchbase.com). Therefore, one key issue with equity financing is that it effectively takes the start-up out of stealth mode and subjects it to public scrutiny. The solution to this issue is to treat the equity financing like a PR campaign and use the press to the company’s advantage through effective communication and good timing. Once a start-up raises money through equity financing, the company effectively has a value as of a certain point in time. The value is determined simply by dividing the amount of money invested in the start-up by the percentage of equity received from that investment (e.g., if investors pay $1,000,000 for 10%, the start-up has a value of $10,000,000). This has many implications. For example, start-ups often incentivize employees to work long hours for less pay by offering stock options. The value of a stock option is the difference between the price that the employee must pay to get the stock (this strike price is set by contract and does not change) and the value of the stock (the market price, which changes frequently). Clearly, the employees prefer to get stock options when the strike price is low, but there are laws about setting the strike price based on the value of the company. Once the company has a value determined by outside investment, the strike price typically increases dramatically,

66

Start-Up Creation

making stock options less valuable. Therefore, it may be a good idea to grant stock options before seeking an equity investor (Casserly, 2013). Another issue is the expense of doing an equity financing. Expect legal fees to cost at least $25,000 for a standard equity financing. That cost can increase dramatically if the start-up has done a poor job of maintaining records and complying with corporate formalities before the financing. The equity investors will require the start-up to pay lawyers to clean up the books and records before closing the investment. This process can also require the entrepreneurs to spend a lot of time on due diligence, the process by which the start-up discloses information to the investor who then reviews the business. During this process, some issues such as lawsuits, patent infringement, and disgruntled employees may come out and be memorialized indefinitely in the stock purchase agreement. Start-ups that have the financial means to do so would be well advised to ensure their corporation is compliant with the law before seeking financing (Gartner et al., 2012). Finally, the stock purchase agreement and other equity financing documents are technical and complicated, but in a different and more dangerous way than bank financing documents. Whereas debt-financing documents can contain numerous restrictive covenants and severe penalties for late payment, a founder can easily recognize the important economic terms such as interest rate and loan term. In equity financing, however, the economic terms are much more complex. For example, simply changing the liquidating preference multiple from one to two means that, in the event of an acquisition or liquidation, the preferred stockholders get twice their investment before the common stockholders get anything. A sophisticated entrepreneur can learn about these terms by studying a term sheet and reviewing the annotated version of these forms (available online at nvca.org), but a good lawyer is truly worth hiring in this context, where a seemingly tiny detail can result in millions of dollars.

4.4 4.4.1

Convertible debt financing Introduction

Convertible debt is a hybrid between debt and equity. Convertible debt is technically a loan, typically with a very low or nominal interest rate. The interest rate can be low because the point of the loan is not to earn money on interest but to convert the debt to equity upon a triggering event, such as another financing or the expiration of a period of time. Convertible debt was traditionally used for bridge loans, which are loans between two rounds of financing to carry the start-up through a brief but tough time. Nowadays, start-ups frequently receive their first financing (also called seed financing) through convertible debt because this seed note method is relatively quick, cheap, does not require the company to be firmly valued, and may not require the start-up to make the public disclosures associated with stock issuances (Werner, n.d.).

Start-up financing

4.4.2

67

Pros and cons

The main advantage of convertible debt is that this method is quick and inexpensive. Whereas an equity-financing round can easily cost $25,000 or more, a seed note round can be accomplished for $5000 or less. The reason for the low cost is that seed notes are very simple instruments that effectively put off discussions regarding valuation, board seats, protective provisions, liquidation preferences, and many other complex terms until a triggering date or event in the future (Werner, n.d.). Until the seed note converts to equity, the noteholder is not a stockholder. Noteholders are not entitled to shareholder rights such as voting on mergers, and they almost never receive protective provisions. Seed notes also generally lack the strict affirmative covenants found in conventional debt agreements. As a result, entrepreneurs are generally free from virtually any investor influence during the preconversion period (Kramer and Levine, 2012). Seed notes also do not require the entrepreneur and the investor to agree on a valuation of the company. The notes do not translate into a percentage of equity until the next equity financing. This eliminates what is often the most contentious aspect of start-up financing: valuing a new and unique company in its very early stages. The flip side of this kick-the-can-down-the-road method is that there is a great amount of uncertainly as to what investors will ultimately receive. To understand why requires a brief discussion of how seed notes work. There are essentially only four material terms in a seed note agreement. First, how much will be invested as debt? Second, at what interest rate should the debt accrue? Third, when does the debt investment convert into equity? Fourth, does the debt investor get a discount (relative to later investors) when the note converts at the next financing? There are some other material terms such as what happens in the event of a preconversion acquisition and whether the investor shall receive financial statements during the preconversion period, but the focus is generally on the economics of conversion in the next financing (Werner, n.d.). The seed notes will likely stipulate that the noteholder gets equal or better rights than any new investor in the next equity financing and that the noteholder will pay the same or less than any new investor in that next round (Werner, n.d.). However, when the note is formed, neither party has any way to know what the rights nor price of the next financing will be. There are a few techniques employed to address this uncertainty, such as a valuation cap, which reflects the highest price per share that the noteholder will pay upon conversion, but the uncertainty regarding final terms about control, preference, and voting rights is the unavoidable consequence of not negotiating these terms upfront.

4.4.3

Key issues

Negotiations over seed notes typically focus on two main economic terms: the cap and the discount. First, consider a situation where there is no cap and no discount. The start-up issues 1,000,000 shares of common stock to founders. Then a seed note investor purchases a $100,000 note with 0% interest. Later, an equity investor values

68

Start-Up Creation

the 1,000,000 shares at $1,000,000 (this is called the premoney valuation), or $1.00 per share, and agrees to purchase 200,000 shares of preferred stock for $200,000. Upon the closing of that stock purchase, the seed note investor receives 100,000 shares of preferred stock, too. After the equity financing, the founders hold 77% of the equity (Werner, n.d.). Now take these same facts, except that the note has a 20% discount. That means the noteholder pays $0.80 per share and receives 125,000 shares of preferred stock. After the equity financing, the founders hold only 75% of the equity. Instead of a discount, assume the note has a $500,000 valuation cap. That means that the noteholder will never pay more than $0.50 per share (which is derived from a $500,000 valuation for 1,000,000 shares). Now the noteholder receives 200,000 shares of preferred stock, and after the equity financing, the founders hold only 71% of the equity. Finally, consider a note that has a $500,000 cap and a 20% discount. Typically, a noteholder gets the better of the two options, but not both. Under the previous facts, the cap is more valuable than the discount. However, if the new equity investor valued the company at less than $625,000, the discount would instead be applied because it is more valuable to the noteholder. As this hypothetical situation should make clear, the number of shares that a seed note investor ultimately receives cannot be determined when the note is issued. Rather, the noteholder receives a number of shares, which is dependent on the valuation by the next equity investor. This can create a conflict of interest between the noteholder and the founder. The holder of a note that does not have a cap may want the company to close its next equity financing when the stock value is as low as possible as to get the highest number of shares, whereas the company is best served by holding out for a higher valuation. On the other hand, if the note is capped, both the note holder and the founders may want to receive a high valuation in the next round, but if the valuation is too high, then the note holder will effectively get a massive discount vis-a-vis the next equity investor. This can seem unfair and thus discourage an equity investor from investing in the start-up. Another issue with seed note financing is that the noteholders eventually become equity holders, so many of the same issues discussed earlier apply here. Founders should consider how such investors will act as stockholders before accepting their investment. In the early stages of a closely held corporation, stockholders can influence management and prevent certain corporate actions. An investor who contributes $100,000 in a seed note round may need to consent to a sale of the company for $10,000,000 several years later. Before accepting funds, remember that equity investment is a long-term relationship and that seed noteholders will become equity holders.

4.5 4.5.1

Crowdfunding Introduction

Crowdfunding is “the use of small amounts of capital from a large number of individuals to finance a new business venture.” (Tim Smith, 2019). This is typically

Start-up financing

69

accomplished utilizing the Internet and various social media platforms, allowing the general public to take part in the investing process (Prive, 2012). This “approach is attractive to entrepreneurs, because it not only allows raising capital for small businesses, which have very limited financing options, but also serves as a tool for testing  e and Jegelevici marketability.” (ValanCien_ ut_e, 2013). Others have described this “market test” function as the nonpecuniary value of crowdfunding (Oranburg 2015b). New laws allowing crowdfunding have been promoted by the Obama administration because “crowdfunding offers real promise for underserved business entrepreneurs and may allow the organizations that serve them the ability to reach even deeper into the entrepreneurial community” (Rand, 2012). There are high hopes for this new fundraising model. Business scholars have even suggested that crowdfunding can change the very nature of capitalism by dramatically lowering the difficulty of raising funds (Macaulay, 2015) by bringing about “more efficiency, lower transaction costs and increased flexibility in world financial markets” (Fanea-Ivanovici, 2019). But crowdfunding is not entirely new. Crowdfunding is a blanket term that covers a range of different models for raising capital, which can be categorized into five types: (1) donations, (2) rewards, (3) prepurchases, (4) lending, and (5) equity crowdfunding. Entrepreneurs can combine these models for specific fundraising purposes.

4.5.1.1

Donations

The donation model of crowdfunding does not involve the sale of securities (Sheik, 2013). Those who donate to crowdfunding projects do not receive any financial interest or material return on their investment (Zhao et al., 2019). This appeals to donors who want to foster the development of intangible common goods and social welfare projects. Donors for these projects do not receive a direct, private benefit, although they may appreciate an indirect, public benefit to donors and nondonors alike. This altruistic donation model of crowdfunding has proven popular for charities due to its transparency and personal touch (National Overview, n.d.), but it is not a common way that for-profit start-ups raise money (Belleflamme et al., 2012). It is more common for entrepreneurs to seek financing with an approach that eschews the donation model or combines it with one or more of the other models described next (Belleflamme et al., 2012).

4.5.1.2

Rewards

The rewards model of crowdfunding allows a supporter to invest in an organization or cause in return for a reward such as being “credited in a movie, having creative input into a product under development, or being given an opportunity to meet the creators of a project” (Bi and Usman, 2017). The reward model is often combined with the donation model. For example, due to financing problems during the construction of the Statute of Liberty in 1884, Joseph Pulitzer urged the American public in his newspaper New York World to donate money for the statue’s pedestal. In response, approximately 125,000 people donated over $100,000 to the project. As a reward, Pulitzer published the names of each individual who contributed to the project in

70

Start-Up Creation

his newspaper (Pulitzer, National Parks Service, 2019). More recently, large donors to The Canyons movie received cameos, script reviews, and even the money clip that Robert DeNiro gave director Burt Schrader on the set of the movie Taxi Driver as a reward for their contributions to the film (Rodrick, 2013). Kickstarter is a crowdfunding website that encourages the use of the rewards model (Rewards, n.d.). Rewards include copies of the thing produced, limited editions of the product, collaborations with the donor in the production, experiences with the producers, and mementos of the project (Rewards, n.d.). Being rewarded with the final product is similar to engaging in the prepurchase model of crowdfunding described later, but the distinction is that rewards are technically considered gifts that are not offered for sale (Terms of Use, n.d.). Start-ups that produce consumer goods find that the rewards model is an effective way to raise capital, although more money can be raised more easily with the prepurchase model described next. Start-ups that cannot easily produce an entertaining reward have trouble using the rewards model of crowdfunding.

4.5.1.3

Prepurchase

The prepurchase model is the most common type of crowdfunding (Bradford, 2012). Under the prepurchase model, the consumer pays in advance for the product. If the start-up launches the product, the consumer typically receives that product for a lower price than regular customers who purchase the product after it is already on the market (Hossain and Oparaocha, 2015), and the consumer receives nothing if the start-up fails (Manderson, 2012). For example, if you pledged $185 or more on Kickstarter in 2014 for the Coolest Cooler, that start-up promised to send you the cooler with some add-ons and “swag” by February 2015 (Kickstarter, 2019). This was a special price for early investors. Today, the Coolest Cooler has a starting retail price of $249.99 (Coolest Cooler, 2019). However, the $13 million they initially raised was not enough to get the product out to investors. “[M]ore than 60,000 backers were supposed to receive their coolers in February 2015. Many did, but many more did not as delays and glitches hit production,” requiring the company to raise additional funds (Feldman, 2016).

4.5.1.4

Lending

Banking is a heavily regulated industry, and much of crowdlending is regulated by federal agencies. As a result, there tend to be fewer platforms for crowdlending. The crowdlending platform Lending Club was the one such platform to register with the Securities and Exchange Commission (SEC) (FAQ for New Investors, n.d.). Lending Club’s financial innovation is to connect lenders and borrowers in what is called P2P lending (Verstein, 2011). On Lending Club, customers interested in a loan complete a web-based application that is evaluated by Lending Club for creditworthiness and assigned an interest rate (FAQ for New Investors, n.d.). Investors select loans in which to invest based on risk factors and interest rates (FAQ for New Investors, n.d.). The minimum required to invest is only $25, so broad diversification is

Start-up financing

71

possible for Lending Club investors with limited capital (Earn Solid Returns, n.d.). The term of loans on Lending Club is generally 3 or 5 years, at a fixed interest rate and straight-line amortization (Lending Club, 2014). The lending model works best for start-ups that deal with tangible goods and have some sort of collateral. The risk of nonrepayment for unsecured business loans is very high, so investors require a commensurately high return on investment to compensate for this risk. To receive such a high rate of return through the lending model of crowdfunding, interest rates on the loans may be so high as to be illegally usurious. By posting collateral, producing valuable goods, or holding real property, start-ups can reduce their risk of nonpayment and obtain “crowdlending” on more favorable terms.

4.5.1.5

Equity crowdfunding

The Jumpstart Our Business Start-ups Act of 2012 (the JOBS Act) amends Section 4(a) (6) of the Securities Act of 1933, as amended (15 U.S.C. x 77d(a) (6) (2015)) (the Securities Act), to allow a private corporation to offer and sell up to $1 million worth of equity securities (stock) in a 12-month period to the general public without registering the securities with the SEC. This new exemption to registration under the Securities Act is generally called crowdfunding, although this federal law is more accurately called equity crowdfunding (Securities and Exchange Commission (SEC), 2012). There are also dozens of intrastate equity crowdfunding laws that are available where companies and investors are located in the same state, but these varied and nascent laws are beyond the scope of this chapter. The SEC issued its final rules on equity crowdfunding on October 30, 2015, which went into effect allowing Internet funding portal registration on January 29, 2016, and allowing stock issuances starting on May 16, 2016 (SEC, 2015). The size of this financing market, the role of the funding portals, and many other details will take time to emerge. However, some of the key crowdfunding rules are provided in the JOBS Act itself. Individuals who have between $100,000 and $1 million in annual income or net worth may invest 10% of it each year in start-ups through crowdfunding (15 U.S.C. x 77d(a) (6) (B) (ii) (2015)). Individuals who have or annually earn less than $100,000 may invest the greater of $2000 or 5% of their annual income each year in start-ups (15 U.S.C. x 77d(a) (6) (B) (ii) (2015)).

4.5.1.6

Venture philanthropy

At its core, venture philanthropy is modeled around the same concepts as venture capital. Venture capitalists aim to quickly grow start-ups by providing large amounts of funding in the hopes of earning a high rate of return off of their investment (Davila et al., 2003). Venture philanthropists have the same aim as venture capitalists, but, instead of trying to grow their wallets, venture philanthropists “invest” in the hopes of increasing net social welfare for society (Defourny et al., 2014). They aim “to serve more people, more effectively” (Grossman et al., 2013). Philanthropic investors concentrate their support on creating new and innovative answers to current social issues they are interested in such as medical research, environmental cleanup efforts,

72

Start-Up Creation

or education reform (Zeichner and Pe~ na-Sandoval, 2017). That is, investors are not, at least initially, concerned with turning a profit; their investment is intended mostly (or entirely) for philanthropic purposes. The Bill and Melinda Gates Foundation, for instance, provide funds worldwide for a variety of social issues (Gates Foundation, n.d.). Venture philanthropy has characteristics similar to the various funding methods discussed earlier. Generally, this form of funding tends to act similarly to the donation model in that the investor gives a large sum of capital to the start-up but does not receive any financial interest or material return on their investment. Their “return on investment” is simply the benefit provided to society if the venture succeeds. However, this does not mean that a monetary return is out of the question. Some reports have highlighted the importance of venture philanthropy and its effect on impact investing (Bannick and Goldman, 2012). Impact investing is a combination of venture philanthropy and venture capital in that it serves the dual purpose of earning financial returns while addressing a specific social issue (Barber et al., 2017). Impact investing can then mimic the lending model for start-up financing and allow the philanthropist to transform into the capitalist once the philanthropic endeavor has scaled accordingly. Start-ups whose value proposition includes a clear social benefitdsuch as providing clean water in rural areas, reducing environmental hazards in cities, connecting first responders with emergency situations, offering crisis counseling through chatbots and AI, optimizing food waste collection, and perhaps even offering mobility solutions like a network of scootersdmay have access to capital from venture philanthropists and impact investors. For such mission-driven start-ups, venture philanthropists and impact investors offer financing on very company-favorable terms. Start-ups should note that while some venture philanthropists give generally, many have a particular focus on a sector or industry, or an even narrower focus on solving a specific problem. This is even more true with impact investors, who generally specialize in a particular industry or impact area. Accordingly, mission-driven start-ups should research which venture philanthropists and impact investors may be interested in their region, industry, or solution.

4.5.1.7

Initial coin offerings

Initial coin offerings (ICOs) are the newest form of start-up financing available today. These offerings raise funds by selling cryptotokens or “coins” in exchange for legal tender or other cryptocurrencies through a blockchain (Amsden and Schweizer, 2018), similar to selling stock in an initial public offering (“IPO”). IPOs, however, are heavily regulated by the SEC, whereas ICOs remain mostly unregulated. In a typical ICO, the “coins” that are initially sold will later serve as the medium of exchange on a P2P platform (Li and Mann, 2018). Blockchain start-ups have embraced ICOs as a vehicle to raise early capital (SEC, 2018). The “coins” offered in these sales are intended to fill a widely varied set of roles on different platforms. Some “coins” are similar to currencies, others act more like securities in a publicly traded company, and others have properties that are entirely new (Conley, 2017). Such a new medium of exchange is not without

Start-up financing

73

risk: ICO advisory firm Statis Group recently published a study claiming more than 80% of ICOs conducted in 2017 were scams (Alexandre, 2019). Cryptocurrency start-up Confido, for example, raised $375,000 through one such ICO before vanishing with investors’ money (Kharpal, 2017). Instances similar to Confido are numerous, so it is recommended that entrepreneurs avoid ICOs for their financing needs. Presently, due to the absence of regulation, ICOs are too risky to properly employ for sustainable start-up financing.

4.5.2

Pros and cons

Whether or not crowdfunding is right for your start-up may depend on your mission or on the nature of the product your business will produce. Crowdfunding, especially donation and rewards crowdfunding, can be very useful for start-ups with a primary purpose of producing a social benefit because crowds may be inspired to fund projects that create a public good. The rewards model of crowdfunding, in particular, has been used by nonprofit organizations such as the Smithsonian Institute to fund public work projects such as the Reboot the Suit campaign (Reboot the Suit, n.d.). This may extend to eco-friendly projects and socially responsible investing (Chamberlain, 2013). Consumer products are the basis of the most successful crowdfunding campaigns on leading platforms such as Kickstarter and Indiegogo. Only one of the top 15 crowdfunding campaigns in 2014 was not for a consumer product, although it was for Reading Rainbow, a social benefit project (15 most funded, 2015). Business-to-business (B2B) crowdfunding has not taken off with a donation, reward, or prepurchase model. B2B companies and service companies are probably limited to the lending and equity crowdfunding models unless their business focuses primarily on providing a compelling social benefit. Therefore, start-ups offering B2B solutions will probably not seriously consider crowdfunding as the primary means to finance the business; however, as equity (investment) crowdfunding develops, it could become a useful financing tool for B2B start-ups. A benefit of nonequity crowdfunding is that entrepreneurs maintain control of the business. Backers obtain no control rights under the donation, reward, or prepurchase model, although start-ups that raise money in these ways may feel obligated to keep backers informed about progress. That is not to say, however, that there are no rules regarding nonequity crowdfunding. To the contrary, the Federal Trade Commission has sued start-ups that sought money on Kickstarter and failed to deliver products (Federal Trade Commission (FTC), 2015). Therefore, nonequity crowdfunding creates legal risks for entrepreneurs and companies. Under lending crowdfunding models, the lender may obtain some contractual rights to the start-up’s books and records, and the start-up may be forbidden from selling more equity or taking on more debt while the crowdfunded loan is outstanding. The restrictive covenants on crowdfunded loans vary widely depending on the platform, loan amount, and other factors. Raising money through equity crowdfunding requires making a number of disclosures. Start-ups must file a Form C with the SEC, keep various records, and produce financial statements before raising more than $500,000 (Lingam, n.d.; Crowdfunding, 2013). If a start-up raises a substantial amount of money through equity crowdfunding,

74

Start-Up Creation

it may have to get stockholder approval from the crowdfunding investors, which may be a diverse and hard-to-contact group. That can slow down or even prevent management from engaging in corporate finance and acquisition activities.

4.5.3

Key issues

The donation, reward, and prepurchase crowdfunding models do not involve the sale of any securities under federal law (Bradford, 2012). The touchstone of the Supreme Court’s test for what defines a security is whether the investment is premised on a reasonable expectation of profits (United Housing Foundation, 1975). But start-up investors are generally not interested predominately in nonfinancial rewards. Investors generally want to earn a return on their investment, so donations, prepurchases, and nonfinancial rewards can only attract a limited number of investors (Bradford, 2012). To offer investors an opportunity to earn business profits, entrepreneurs will have to comply with securities regulations including Title III of the JOBS Act of 2012. As discussed earlier, the biggest issue with donation, rewards, and prepurchase crowdfunding is that there are very few examples of B2B or service companies using those models successfully. That means lending and equity crowdfunding may be the only crowdfunding options for many start-up. Crowdlending has many pros and cons, as discussed earlier, but it may be easier for a start-up to get a loan through crowdfunding than through a conventional bank. The biggest issue with equity crowdfunding is that it is new, so investors are skeptical and unsure how it will work. This limits investor interest in this fundraising modality. Congress is working on JOBS Act 2.0, so there is additional regulatory uncertainty around equity crowdfunding because Congress may change the statute that enables it (Clifford, 2015). If companies use crowdfunding to commit fraud, that may cause a backlash against equity crowdfunding that potentially shuts down the entire model (Hazen, 2012). At this stage in the development of equity crowdfunding, there are many political, legal, business, and societal uncertainties that make this new model both exciting and risky.

4.6

Conclusions and future trends

The financial future looks bright for many high-growth start-ups. Thanks in part to social media and Web 2.0 technology, new approaches to start-up financing are rapidly emerging. Equity (investment) crowdfunding is now permissible in the United States, and over two-dozen equity crowdfunding websites have registered as funding portals. Crowdlending websites such as Lending Club and Prosper continue to increase access to debt financing without banks. Angel investors are sourcing deals online through angel crowdfunding portals such as Angel.co and OurCrowd.com, which led to angel investments in 66,110 different companies in 2018. Meanwhile, venture capitalists pumped $131 billion into start-ups in 2018declipsing the $100 billion watermark previously set at the height of the dot-com boom in 2000. Hundreds of

Start-up financing

75

billion-dollar start-upsdonce called “Unicorns” for their raritydare now common household names. Yet there are several mars on this otherwise rosy picture. Minority, female, and rural businesspeople still do not receive venture capital at the same rates as white, male entrepreneurs in big cities such as San Francisco and New York. Cryptocurrencies turned out to be fraught with scams and other perils. And some companiesd notably slow-growth small businesses in more traditional industriesdhave seen relative or absolute diminutions in their financing prospects. However, scholars and policymakers are now focusing on finding solutions to these problems, and venture philanthropists and impact investors are actively seeking opportunities to make investments in diversity and inclusion. With all the options that abound in start-up financing today, it is more important than ever to formulate a business plan that includes a financing strategy. Working with a good start-up lawyer can help entrepreneurs understand the legal and business implications of financing choices.

References Alexandre, A., July 13, 2018. New Study Says 80 Percent of ICOs Conducted in 2017 Were Scams. https://cointelegraph.com/news/new-study-says-80-percent-of-icos-conducted-in2017-were-scams. Amsden, R., Schweizer, D., 2018. Are Blockchain Crowdsales the New “Gold Rush”? Success Determinants of Initial Coin Offerings. SSRN Electronic Journal. https://doi.org/10.2139/ ssrn.3163849. Angel List, n.d, 2015. Incubator e Company Types. Retrieved August 14 from: https://angel.co/ incubators. Aydin, N., 2015. Startup-Stage Financing of Innovative Ventures: The Case of UNNADO.com. International Journal of Education and Social Science 2 (12). Bannick, M., Goldman, P., September 25,2012. Priming the Pump: The Case for a Sector Based Approach to Impact Investing. Omidyar Network. Accessed March 2013. http:// www.omidyar.com/sites/default/files/Priming%20the%20Pump_Omidyar%20Network_ Sept_2012.pdf. Barber, B.M., Morse, A., Yasuda, A., 2019. Impact Investing. SSRN Electronic Journal. https:// doi.org/10.2139/ssrn.2705556. Belas, J., Bartos, P., Kljucnikov, A., 2015. Risk Perception Differences Between Micro-, Small and Medium Enterprises. Journal of International Studies 8 (3). https://doi.org/10.14254/ 2071-8330.2015/8-3/2. Belleflamme, P., Lambert, T., Schwienbacher, A., 2012. Crowdfunding: Tapping the Right Crowd. Journal of Business Venturing 29 (5). https://doi.org/10.1016/j.jbusvent. 2013.07.003. Bi, S., Liu, Z., Usman, K., 2017. The Influence of Online Information on Investing Decisions of Reward-based Crowdfunding. Journal of Business Research 71, 10e18. https://doi.org/ 10.1016/j.jbusres.2016.10.001. Bill, Melinda Gates Foundation, n.d., 2019. What We Do. https://www.gatesfoundation.org/ What-We-Do. Booth, R.A., 2014. Financing the Corporation. Thomson Reuters.

76

Start-Up Creation

Bradford, C.S., 2011. Crowdfunding and the Federal Securities Laws. Columbia Business Law Review 1, 1e150. Casserly, M., 2013. Understanding Employee Equity: Every Startup’s Secret Weapon. Forbes, March 11. http://www.forbes.com/sites/meghancasserly/2013/03/08/understanding-emplo yee-equity-bill-harris-sxsw/. Chakraborty, A., Mallick, R., 2012. Credit Gap in Small Businesses: Some New Evidence. International Journal of Business 17, 65e80. Chamberlain, M., April 24, 2013. Social Responsible Investing: What You Need to Know. Forbes. http://www.forbes.com/sites/feeonlyplanner/2013/04/24/socially-responsibleinvesting-what-you-need-to-know/. Clifford, C., February 2 2015. Déja Vu 2012: A Zombie-Frankenstein JOBS Act 2.0 Is in the Works. Entrepreneur. http://www.entrepreneur.com/article/242442. Conley J., Blockchain and the Economics of Crypto-Tokens and Initial Coin Offerings, Vanderbilt University Department of Economics Working Papers, 17-00008, (2017).Crowdfunding: 78 Federal Register 66,428, November 5, 2013, (proposed). Cumming, D., Grilli, L., Murtini, S., 2017. Governmental and Independent Venture Capital Investments in Europe: A Firm-level Performance Analysis. Journal of Corporate Finance 42, 439e459. Davila, A., Foster, G., Gupta, M., 2003. Venture capital Financing and the Growth of Startup Firms. Journal of Business Venturing 18 (6), 689e708. https://doi.org/10.1016/s08839026(02)00127-1. Deeb, G., March 19, 2014. Comparing Equity, Debt and Convertibles for Startup Financings. Forbes. http://www.forbes.com/sites/georgedeeb/2014/03/19/comparing-equity-vs-debt-vsconvertibles-for-startup-financings/. Defourny, J., Nyssens, M., Thys, S., 2014. Beyond Philanthropy: When Philanthropy Becomes Social Entrepreneurship. In: The Routledge Companion to Philanthropy. DonorsChoose.org, n.d. National Overview, pp. 348e361. Donors Choose, August 18, 2015. https://storage. donorschoose.net/dc_prod/docs/DonorsChoose_org-NationalOverview.pdf?v¼147681347 9055. Empey, G., August 14, 2015. n.d. Protecting Your Founder Equity. Cooley Go. https://www. cooleygo.com/protecting-founderequity/. Fanea-Ivanovici, M., 2019. Filmmaking and Crowdfunding: A Right Match? Sustainability 11, 799. Federal Trade Commission, June 11, 2015. Crowdfunding Project Creator Settles FTC Charges of Deception. https://www.ftc.gov/news-events/press-releases/2015/06/crowdfundingproject-creator-settles-ftc-charges-deception. Feldman, A., 2016. Lessons from A Kickstarter Fail: Coolest Cooler Raised $13M, but Needs More Cash to Fulfill Orders. Forbes, March 8. https://www.forbes.com/sites/amyfeldman/ 2016/03/08/coolest-cooler-raised-13m-and-is-now-toobroke-to-fulfill-orders-lessonsfrom-a-kickstarter-fail/#1d80caac5405. FINRA, n.d., 2019. Funding Portals We Regulate. FINRA.org. https://www.finra.org/about/ funding-portals-we-regulate. Fisch, J.E., 2000. The Peculiar Role of the Delaware Courts in the Competition for Corporate Charters, 68. University of Cincinnati Law Review, pp. 1061e1100. Gartner, W.B., Frid, C.J., Alexander, J.C., 2011. Financing the Emerging Firm. Small Business Economics 39, 745e761. Grossman, A., Appleby, S., Reimers, C., 2013. Venture Philanthropy: Its Evolution and Its Future. Harvard Business School Background Note. N9-313-111.

Start-up financing

77

Hazen, T.L., 2012. Crowdfunding or Fraudfunding? Social Networks and the SecuritiesdWhy the Specially Tailored Exemption Must Be Conditioned on Meaningful Disclosure. North Carolina Law Review 90, 1735e1769, 2012. Hossain, M., Oparaocha, G., 2015. Crowdfunding: Motives, Definitions, Typology and Ethical Challenges. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2674532. Huang, L., Knight, A.P., 2017. Resources and Relationships in Entrepreneurship: An Exchange Theory of the Development and Effects of the Entrepreneur-Investor Relationship. Academy of Management Review 42 (1), 92. https://doi.org/10.5465/amr.2014.0397. Hyman, M., 2014. Corporation Forms. Thomson Reuters, Eagan, MN. Indiegogo, August 19, 2015. Inc, n.d. Terms of Use. https://www.indiegogo.com/about/terms. Jagannathan, M., Pritchard, A., 2017. Do Delaware CEOs Get Fired? Journal of Banking and Finance 74, 85e101. https://doi.org/10.1016/j.jbankfin.2016.10.008. Jumpstart Our Business Startups Act, 2012. Pub. L., p. 112-106. x 303(b). 126 Stat. 306. Kharpal, A., 2017. Cryptocurrency Start-Up Confido Disappears with $375,000 from an ICO, and Nobody Can Find the Founders. CNBC, November 21. https://www.cnbc.com/2017/ 11/21/confido-ico-exit-scam-founders-run-awaywith-375k.html. Kickstarter, n.d., August 10, 2019. Coolest Cooler: 21st Century Cooler that’s Actually Cooler. https://www.kickstarter.com/projects/ryangrepper/coolest-cooler-21st-century-coolerthats-actually. Kickstarter, n.d., August 19, 2015. Reboot the Suit: Bring Back Neil Armstrong’s Spacesuit. https://www.kickstarter.com/projects/smithsonian/reboot-the-suit-bring-back-neilarmstrongs-spacesu. Kramer, B.J., Levine, S.S., 2012. Seed Finance Survey 2012: Internet/Digital Media and Software Industries. Fenwick & West,LLP. https://www.fenwick.com/FenwickDocuments/2012_ Seed_Survey_Report.pdf. Lee, Y.S., 2018. Government Guaranteed Small Business Loans and Regional Growth. Journal of Business Venturing 33 (1), 70e83. https://doi.org/10.1016/j.jbusvent.2017.11.001. Lending Club, n.d., August 19, 2015. Earn Solid Returns. https://www.lendingclub.com/public/ steady-returns.action. Lending Club, n.d., August 19, 2015. FAQ for New Investors. https://www.lendingclub.com/ public/investing-faq.action. Lending, August 22, 2014. Club, Prospectus. https://www.lendingclub.com/fileDownload. action?file¼Clean_As_Filed_20140822.pdf&type¼docs. Li, J., Mann, W., 2018. Initial Coin Offering and Platform Building. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3088726. Lingam, K., August 19, 2015. Equity Crowdfunding Rules: The Good, the Bad, & the Ugly. Seed Invest. http://www.seedinvest.com/blog/equity-crowdfunding-rules-good-bad-uglypart-ii/. Macaulay, C., 2015. Capitalism’s Renaissance? The Potential of Repositioning the Financial ‘Meta-Economy’. Futures 68, 5e18. Manderson, C., April 28, 2012. The JOBS Act, Part 4: Will Crowdfunding Live up to the Hype? PE HUB. https://www.pehub.com/2012/04/will-crowdfunding-live-up-to-the-hype-part-4of-a-4-part-series-on-the-jobs-act/. National Park Service, n.d., Joseph Pulitzer, Retrieved August 11, 2019, https://www.nps.gov/ stli/learn/historyculture/josephpulitzer.htm. Oranburg, S., 2015. Bridgefunding: Crowdfunding and the Market for Entrepreneurial Finance. Cornell Journal of Law and PublicPolicy 25 (2).

78

Start-Up Creation

Oranburg, S., April 6, 2015. The Law & Economics of the Series A Gap, The CLS Blue Sky Blog. http://clsbluesky.law.columbia.edu/2015/04/06/the-law-economics-of-the-series-agap/. Oranburg, S., 2015. The Non-Pecuniary Value of Equity Crowdfunding. Chicago-Kent College of Law Research Paper No. 2015-10. https://ssrn.com/abstract¼2620011. Peirce, H., Robinson, I., Stratmann, T., February 27, 2014. How Are Small Banks Faring under Dodd-Frank? Mercatus Center at George MasonUniversity. https://www.mercatus.org/ publications/regulation/how-are-small-banks-faring-underdodd-frank. Press, G., February 16, 2015. 15 Most-Funded Crowdfunding Projects on Kickstarter and Indiegogo. Forbes. http://www.forbes.com/sites/gilpress/2015/02/16/15-most-fundedcrowdfunding-projects-on-kickstarter-and-indiegogo/4/. Prive, T., November 27, 2012. What Is Crowdfunding and How Does it Benefit the Economy. Forbes. http://www.forbes.com/sites/tanyaprive/2012/11/27/what-is-crowdfunding-and-howdoes-it-benefit-the-economy/. Rand, D., June 28, 2012. The Promise of Crowdfunding for Social Enterprise. In: “Rewards.”, n.d., Creator Handbook. Kickstarter. Retrieved August 19, 2015. https://obamawhitehouse. archives.gov/blog/2012/06/28/promise-crowdfunding-social-enterprise. https://www.kick starter.com/help/handbook/rewards. Rodrick, S., January 10, 2013. Here Is what Happens When You Cast Lindsay Lohan in Your Movie, The New York Times. https://www.nytimes.com/2013/01/13/magazine/here-iswhat-happens-when-you-cast-lindsay-lohan-in-yourmovie.html. Sargent, M.A., Schwidetzky, W.D., 2014. Limited Liability Company Handbook. Thomson Reuters, Eagan, MN. SBA, 2015. loans: A Primer, Entrepreneur, Retrieved August 13 from: http://www.entrepreneur. com/article/217372. Schwartz, A.A., 2013. Crowdfunding Securities. Notre Dame Law Review 88 (3), 1460. Securities Act of 1933, 2015, 15 U.S.C. x 77d(a)(6). Sheik, S., May 2013. Fast Forward on Crowdfunding. Los Angeles Lawyer 36 (37). Sloans, B.A., Primer, A. Entrepreneur. Retrieved August 13, 2015 from. http://www. entrepreneur.com/article/217372. Smith, D.G., 2005. The Exit Structure of Venture Capital, 53. University of California-Los Angeles Law Review, pp. 315e356. Smith, T., June 26, 2019. Crowdfunding Definition, Investopedia. https://www.investopedia. com/terms/c/crowdfunding.asp. Soetanto, D., van Geehuizen, M., 2015. Getting the Right Balance: University Networks’ Influence on Spin-offs’ Attraction of Funding for Innovation. Technovation 36e37, 26e38. Terziev, V., 2017. Social Entrepreneurship as An Opportunity to Model an Active Social Program. International E-journal of Advances in Social Sciences 3 (8), 489e495. https:// doi.org/10.18769/ijasos.336981. United Housing Foundation, 1975. Inc., v. Forman, 421. U.S., p 837 United States Securities and Exchange Commission, May 7, 2012. Jumpstart Our Business Act: Frequently Asked Questions about Crowdfunding Intermediaries. https://www.sec.gov/ divisions/marketreg/tmjobsactcrowdfundingintermediariesfaq.htm. United States Securities and Exchange Commission, October 30, 2015. SEC Adopts Rules to Permit Crowdfunding. http://www.sec.gov/news/pressrelease/2015-249.html. United States Securities and Exchange Commission, January 10, 2018. Spotlight on Initial Coin Offerings (ICOs). https://www.sec.gov/ICO. Valancien_e, L., Jegeleviciut_e, S., 2013. Valuation of Crowdfunding: Benefits and Drawbacks. Economics and Management 18 (1).

Start-up financing

79

Vaznyte, E., Andries, P., 2019. Entrepreneurial Orientation and Start-Ups’ External Financing. Academy of Management Proceedings 34 (1), 439e458. https://doi.org/10.5465/ ambpp.2018.13368abstract. Verstein, A., 2011. The Misregulation of Person-to-Person Lending, 45. University of California-Davis Law Review, pp. 445e530. Walther, B., 2014. The Peril and Promise of Preferred Stock. Delaware Journal of Corporate Law 39, 161e209. Wasserman, N., 2013. The Founder’s Dilemmas: Anticipating and Avoiding the Pitfalls that Can Sink a Startup. Princeton University Press. Weijs, R.D., 2018. Harmonization of European Insolvency Law: Preventing Insolvency Law from Turning Against Creditors by Upholding the DebteEquity Divide. European Company and Financial Law Review 15 (2), 403e444. https://doi.org/10.1515/ecfr-2018-0007. Werner, P. Primer on Convertible Debt, Cooley Go. Retrieved August 14, 2015, from. https:// www.cooleygo.com/convertibledebt/. Ye, Q., 2017. Bootstrapping and New-Born Startups Performance: The Role of Founding Team Human Capital. Global Journal of Entrepreneurship 1 (2). Zeichner, K.M., Pena-Sandoval, C., 2017. The Struggle for the Soul of Teaching Education in the USA. Journal of Education for Teaching: International Research and Pedagogy 63e102. https://doi.org/10.4324/9781315098074-4. Zhao, Y., Harris, P., Lam, W., Crowdfunding industrydHistory, Development, 2019. Policies, and Potential Issues. Journal of Public Affairs 19, 1921.

Further reading Angel Capital Association. FAQs About Angel Groups. Retrieved August 14, 2015, from. http:// www.angelcapitalassociation.org/press-center/angel-group-faq/. Graham, P., December 6, 2013. Announcing the Safe, a Replacement of Convertible Notes. Y Combinator. http://blog.ycombinator.com/announcing-the-safe-a-replacement-for-convertib le-notes. Sumners, P.C., 2012. IV. Crowdfunding America’s Small Businesses After the JOBS Act of 2012, 32. Review of Banking and Finance Law, pp. 38e49.

Intellectual property

5

Anetta Caplanova Department of Economics, University of Economics in Bratislava, Bratislava, Slovakia

5.1

Introduction

The start-up businesses are frequently very proinnovative. Because of the specific nature of innovation, it is important that they paid adequate attention to the protection of their intellectual property. This chapter provides an overview of different forms of intellectual property and of the framework for its protection. We also look at the historical development of the intellectual property rights protection. We pay special attention to the current aspects of the intellectual property protection, which, in the first place, is affected by rapid technological development and globalization processes. Also, we consider some macroeconomic, microeconomic, and business-related implications of the intellectual property protection. We look at the new proposals, which have recently arisen in the area of the intellectual property protection as the reaction to the changes in the economic structure of current societies. On one end, in the current period, when information flows are hard to restrict, it is of even more important that new products, technologies, and other forms of innovation were protected in an appropriate way, either using formal or informal forms of intellectual property protection. On the other hand, it has been pointed out that restrictions on the spread of innovation by the intellectual property regulation undermine innovation activities and ultimately economic growth of current societies. The traditional argument points out that if the issue of the intellectual property right protection is not sufficiently considered, the firm may lose its competitive advantage and be competed out from the market. This is considered especially important in case of small start-up businesses, which usually have limited resources and experience with the intellectual property protection compared with large, well-established firms, which have usually designated departments, or employees, who are responsible for considering the intellectual property issues company wide and frequently also outsource intellectual property protection services to professional firms. However, these are also start-up businesses, which could benefit from alternative arrangements of intellectual property protection and open access to technological progress and related innovation. Also, at the beginning, start-ups are frequently overwhelmed by the complexity of different aspects of a new business and may fail to address the protection of their intellectual property. However, the appropriate intellectual property strategy should be developed, especially if a start-up is based around new innovation(s) to bring to the market. In such a situation, if the intellectual property issues are not adequately addressed, this may jeopardize the business success of the start-up. Thus, in this

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00005-9 Copyright © 2020 Elsevier Ltd. All rights reserved.

82

Start-Up Creation

chapter, we also focus at the discussion of key aspects, which an entrepreneur should be aware of, when considering intellectual property strategies to protect their innovations, which may take up different forms. The type of the intellectual property to be considered also substantially affects the optimal choice of the intellectual property protection by a firm.

5.2

Forms of intellectual property rights

Intellectual discoveries, which turn into innovations, take up the form of new products, services, academic papers, new designs, production methods, or artistic works. Their original nature and innovative character require attention with regard to their protection. The innovation process normally starts with an innovative idea. However, for the ideas to become intellectual property, they must be transformed into innovations. Thus, in general, we may say that intellectual property represents ideas that are encoded in innovative goods. When ideas are expressed in a specific form, i.e., contained in a specific good, or recorded on a specific media, they become innovations, which are the subject of intellectual protection. The process of coming up with new ideas and transforming them into innovations is a costly process and requires substantial investment. Thus, the standard approach argues that adequate protection of intellectual discoveries is needed to ensure reasonable return from resources invested in R&D processes, which led to its development. However, at the same time, the protection of intellectual property is associated with costs for the innovating firm, and it limits the access of other firms to these innovations. From the point of view of an economy as a whole, the latter also restricts the transfer of new innovations throughout the economy. Since innovations and technological progress are important factors of economic growth, the intellectual property protection can reduce its dynamics. The problem of the intellectual property protection is perceived as less pronounced, if innovations lead to new products, which are hard to imitate. But if the new technology can be easily imitated, the barriers for other firms to adapt the innovation without paying for it are low, and there is the need to protect the innovation using existing regulatory framework. Also, often consumers of innovative products and services become their secondary producers distributing them further without a previous consent of the original producer and investment of additional inputs. This is due to the fact that in case of some innovative products, it is easy to extract the essence of the intellectual property by observing and studying the products. This is sometimes referred to as reversed engineering. In this context, there is specific type of competition between a producer of the intellectual property and potential-free riders. If free riders succeed in their effort, they can sell the new technology at lower price than the firm, which came with the innovation, since they did not have to invest resources in producing it,1 which then means lower revenue for an innovating firm. If the production of some goods is based on, e.g., a secret recipe, this method is not efficient, since the 1

See Lemley (2005) for a more detailed discussion.

Intellectual property

83

secret recipe precludes the possibility of reproducing it (e.g., in case of Pepsi Cola soda drink). However, in these cases, it is important to ensure that the trade secret does not leak and become public knowledge. If the free unpaid transmission of innovative products can be precluded, it is possible to sell intellectual property in the same way as private goods (e.g., in case of printed books, where copyrights are efficiently enforced). In such situations, owners of innovations can successfully protect their intellectual property informally without seeking formal protection (Hall et al., 2012). Also, internal norms, which exist within some professional circles, represent a tool to protect innovations within this professional circle (e.g., the ice cream producers sell original ice cream recipes in their circle and stick to the norm not to reveal recipes to outsiders). If the methods of informal intellectual property protection are not effective, the formal protection should be considered. Then, the nature of the intellectual property is important to consider the decision on the appropriate way of the intellectual property protection. In the following subsections, we consider alternative forms of the intellectual property protection.2

5.2.1

Trademarks

Trademarks represent words, phrases, names, symbols, logos, images, or their combination, which are or will be used for commercial purposes to differentiate goods, or services produced by one producer from the goods, or services produced by others. Trademarks are also called brands or logos. In that regard, they serve as an information shortcut for consumers about the product/service they can expect. They help customers to identify the good or service with the specific producer and serve as a guarantee of its origin, standards, and quality. They also provide an incentive to producers to keep the standards of their production so as to ensure the quality associated with the brand and to sustain its reputation. The examples of best-known trademarks include trademarks of McDonalds, Google, or Apple to name just a few well known. The value of these trademarks can reach several dozen billion US dollars. Thus, if well established, recognized, and remembered by consumers, they represent a valuable asset of a firm and as such are valuable intellectual property of a business. Trademarks can be sold, and the conditions for their sale depend on the specific legislation in individual countries. They can be sold either independently from the underlying product, or only together with the related product or service. Producers having a registered trademark for their products have the right for exclusive use of their trademark, and they also have the right to prevent its unauthorized use. When considering the case of an illegal use of a trademark, it is always considered, if a consumer is confused by the use of a similar trademark by the competition with regard to the origin of the product or service. In this context, it should be noted that the trademark can only be registered, if it has distinctive characteristics and it will not confuse consumers in relation to the origin and the quality of the products. 2

The discussion of alternative forms of intellectual property protection and their selected applications can be also found in Poticha and Duncan (2019).

84

Start-Up Creation

Most countries require formal registration of trademarks. If there is the case of the trademark infringement, the formal registration of the trademark becomes crucial. However, in some countries (e.g., in the United States, Canada, or Germany), unregistered trademarks are also recognized and protected. The recognition of unregistered trademarks is normally based on the market share of a given brand on the overall sale of the specific product, and the protection is linked to the business reputation or goodwill. This applies also to situations, when a specific firm used the trademark for the long time, and its business activities could be adversely affected, if a similar trademark was used by the competition. Trademarks are awarded territorially; thus, they are fully enforced only on the specific territory, where they were registered. Even though some protection can be conferred also beyond the limits of this territory, the nature of this protection should be carefully checked. Also, it should be noted that trademarks cannot be registered globally; thus, businesses have to decide on which territory they seek the protection and submit the application for their registration accordingly. International registration of trademarks is facilitated by the Madrid system, which is a centralized system to protect the trademark on the territory of member countries of the system and allows for the registration of a trademark in multiple signatory countries. As will be explained further in more detail, the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) provides the guidelines to facilitate the compatibility of the trademark legislation applied in different countries or regions.3 In the United States, the protection of the trademarks is indicated by two symbols trademarks: “™” for the trademark and “®” for the registered trademark. In the European Union, trademarks are registered by the European Union Intellectual Property Office (EUIPO).4 The European trademark (ETM) provides its owner the protection in all 28 member countries and is complementary to national and regional trademarks existing in the European Union countries. According to the EUIPO website, they register almost 135,000 trademarks annually, and the online application fee is set at 850 Eur as of September 2019. The EUIPO has also tools for searching the trademark databases for the availability of a trademark.

5.2.2

Industrial designs

Industrial design relates to the esthetic aspects of a product, its specific shape, color, pattern, or other visual characteristics. Thus, the industrial design protects visual characteristics and appearance of the article. The protection of industrial designs aims to protect new, distinctively looking products. Hence, designs, which are eligible for the registration, must be original and cannot closely resemble designs, which have already been registered. Industrial designs are also sometimes referred to as design patents. The development of an innovative design of a product requires additional resources and aims to attract consumers and differentiate the product from other 3 4

http://www.wipo.int/madrid/en/. https://euipo.europa.eu/ohimportal/en/trade-marks.

Intellectual property

85

products produced by competitors. If this effort is successful, the unique industrial design represents valuable intellectual property and is a source of a competitive advantage and as such requires protection. The owner of the registered industrial design has the right to prevent others from producing and selling products containing features of the protected design. In terms of product categories, the protection of industrial design is broad and ranges from jewelry to electronic devices. Industrial designs must be registered with an industrial design office on the territory, where the protection is sought. In some countries, industrial design laws provide also limited protection for unregistered industrial designs without the need for registration. Also, industrial designs may be protected as artworks under the copyright law. International protection of industrial designs is provided based on the Hague Agreement and allows for the possibility to have a design protected in several countries by filing one application with the International Bureau of the World Intellectual Property Organization (WIPO).5 In the European Union, the industrial design protection is provided by means of the registration with EUIPO, where they register almost 85,000 designs annually. The registered community design (RCD) is valid in all EU member states.6 The European legislation recognizes also the unregistered community design (UCD). Even though both registered and unregistered designs offer similar protection, the scope of the protection is different. A registered design protection is initially valid for the period of 5 years from the date of filing and can be repeatedly renewed for 5 years, for up to 25 years, provided the related fee is paid. An UCD7 provides short-term protection for unregistered designs. The design is protected for 3 years from the date on which it became available to public on the EU territory. After this period, the protection cannot be extended. However, the owner of the unregistered industrial design can apply for the design registration within 1 year since its disclosure.

5.2.3

Patents and utility models

Patent protection is granted for an invention, a product, or a process, which brings a new technical solution. The invention, which is to be protected by a patent, must be new, useful, functional, and innovative, i.e., solution, for which the patent protection is sought, should not be an obvious one. Patent protection is usually granted for new innovative products, their composition, and technology. The prevailing majority of patent applications is made to patent an improvement of previously existing patented inventions. After the patent was awarded, the patent owner has an exclusive right to prevent others from commercial use of the patented invention.8

5

6 7 8

http://www.wipo.int/hague/en/ As of March 4, 2019, it has provided the protection in 70 contracting parties covering 88 countries. https://euipo.europa.eu/ohimportal/en/designs. The Council Regulation (EC) No. 6/2002 of December 12, 2001, on community designs. The information on patented processes has to be provided by patent applicants in the patent specification, and this way it enters the public domain. However, in many countries there are limited possibilities for free use of patented inventions (limited e.g., to their use for research purposes).

86

Start-Up Creation

Since it is frequently difficult to identify, which inventions have commercial potential, when they appear, firms may have the tendency to use excessive patenting. Rivera and Kline (2000) provide specific examples of companies, which due to inefficient intellectual property protection experienced the loss of their competitive advantage. This behavior can limit innovation activities of their competitors. Since the cost of patenting is relatively low (especially for larger and well-established firms) and potential losses from insufficient protection of innovations are high, businesses have also an incentive to file a patent application at an early stage of the innovation process and to file several patent applications related to the same technology to ensure that alternative commercial applications of their innovations are protected and they will have a patent on the technology, which will ultimately become commercially successful. Thus, also in this regard, we can observe the contradictory impact of patents. On one hand, patent protection can encourage innovation by facilitating adequate return from innovations of innovating firms. On the other hand, the tendency toward over-patenting can adversely affect innovative activities of other firms. It is important to note that patents represent territorial rights granted in a country or a region, in which a patent has been awarded. Patent protection is granted for a limited period of time only, usually 20 years from the date, when the application is filed. Thus, if the firm wants to market patented product in different countries, separate patent protection is to be sought in all countries, where the business is to be conducted. This increases the cost of the patent protection. Except for initial fees related to the patent application, patent holders are also to cover maintenance fees, which are to be paid periodically to “maintain” the patent validity. The patent owners can grant the right to use the patent to other entity; thus, firms requiring the patented technology should get in touch with patent owners to find out under what conditions they could have access to the patented technology. International cooperation in the area of the patent protection of intellectual property is granted by the Patent Cooperation Treaty,9 which was signed in 1970 and amended since with the most recent update of the regulation and administrative procedures in force from July 1, 2019. As of June 2019, it has 152 signatories. The aim of the Treaty is to harmonize procedures for patent application in the signatory states. Even though the international patent application can be filed under this Treaty, it does not result in granting an international patent, but it provides opinion on the patentability of the invention. It has to be followed by the national patent application. In Europe, the European Patent Organization10 represents an intergovernmental organization established in 1977 on the basis of the European Patent Convention signed in 1973. The European Patent Office (EPO) as its executive body examines and grants European patents, which, however, have to be validated separately in each European country, where the patent protection is sought, and the documentation has to be translated into a respective national language. The preparatory work has been carried out to provide unified patent protection in Europe as described in more detail further.

9 10

http://www.wipo.int/pct/en/texts/. http://www.epo.org/about-us/organisation.html.

Intellectual property

87

In some countries,11 specific forms of patentsdutility modelsdare also granted. These are also known as innovation patents, pity patents, short-term patents, or functional designs. The period, for which a utility model is granted, is shorter (on average between 6 and 10 years), and the procedure for granting it is less complicated. Usually, the utility models are used for the protection of less substantial inventions. Even though the cost of patenting may not be high for established firms, start-ups, and new businesses, it may represent an important cost item to consider. These relate not only to the fees associated with filing patents but also to the cost of legal and other professional services needed to be hired to perform activities needed for acquiring adequate patent protection. After the patent was granted, maintenance fees represent additional cost of the patent protection. Also, sound planning of the global strategy to provide adequate territorial protection of the innovation is needed. Defensive publication represents an alternative to patenting. It is used to prevent other parties from obtaining patent protection on a patentable innovation. This strategy is sometimes used by businesses, for which the cost of patent protection is excessively high. It allows the inventor and others to use the innovation without any limitation. However, inventors sacrifice revenues; they could obtain from commercial exploitation of the patented invention.

5.2.4

Copyrights

Copyrights are related to legal rights of authors on their original published and unpublished literary or artistic works. They limit the rights for their use and distribution. As in case of other forms of intellectual property, copyrights protect tangible form of the original work, not the underlying ideas. Tangibles protected by copyrights include not only books, music, and paintings but also computer programs, databases, and technical drawings. It is possible for two authors to obtain copyrights on similar work, if their work was produced independently. Copyright protection establishes the authorship of the work and allows the owner to obtain revenue from the utilization of copyrighted material by other entities. In case of the coauthorship, the copyright is shared by all coauthors. The owner of a copyright has also the right to authorize or prevent the reproduction of the copyrighted material. If the copyrighted work was created within the contract, if not stipulated otherwise in the employment contract, the copyright is owned by the employer. To avoid any dispute, it is suggested that the ownership of copyrights is determined at the point, when the employment contract is concluded. Also, this is important, since the owner of the copyrights is responsible for enforcing the rights, which in case of the copyright infringement can incur substantial costs. Copyrighted material can be provided free of charge without exercising the rights of the copyright owner in specific situations justified by the fair use. Even though the specification of fair use may vary across countries, in general, the term refers to cases promoting social welfare. In the European Union, the fair use of copyrighted materials 11

The list of countries, where the utility models can be acquired, is available here: http://www.wipo.int/sme/ en/ip_business/utility_models/where.htm.

88

Start-Up Creation

is based on the EU directive,12 and it is related to their reproduction by libraries, museums, or archives or reproduction for the benefit of people with disabilities and for noncommercial research purposes. Copyrights represent territorial rights and provide the copyright protection on a specific territory. The copyright laws have been standardized in the Berne Convention and in the Universal Copyright Convention,13 which have been ratified by most countries. According to the Berne Convention,14 the copyright protection is obtained automatically, and special registration of copyrights is not needed. The copyright protection is provided for the lifetime of the author plus subsequent decades (depending on a country ranging between 50 and 100 years). The WIPO adopted the Copyright Treaty15 in 1996 to provide additional copyright protection, which became necessary due to the technological development (e.g., with regard to the spread of computer software).

5.2.5

Trade secrets

Trade secrets represent any confidential information, which is the source of a competitive business advantage. These can be related not only to manufacturing methods and secret recipes but also to the information about customers or suppliers of the company. The unauthorized use of the confidential information (by external or internal parties) is considered to be the violation of the trade secret. The protection of trade secrets is not based on their formal registration; it is usually an integral part of the protection against unfair competition or of the protection of confidential information. According to the Article 39 of the TRIPS Agreement,16 specific conditions must be met for the information to be considered a trade secret. The information must be secret, i.e., not generally known, or easily accessible; it must have commercial value and the owner of the secret must take steps to protect the confidential character of the information. Unlike patents, the protection of intellectual property in the form of trade secrets does not require the disclosure of related information to relevant authorities. Trade secret protection has an advantage of not being limited in time and may continue indefinitely as long as the secret is not revealed to the public. Trade secrets have also some disadvantages and thus should not be considered as a straightforward alternative to the patent protection. If the intellectual property of the company is protected using the trade secret, the company should make sure that only a small number of people have access to confidential information, who are made aware of its confidentiality and agree to comply with the protection of the trade secret. This can be done, e.g., in the form of the 12

13

14

15 16

The Directive 2001/29/EC of the European Parliament and of the Council of May 22, 2001, on the harmonization of certain aspects of copyright and related rights in the information society. http://portal.unesco.org/en/ev.php-URL_ID¼15381&URL_DO¼DO_TOPIC&URL_SECTION¼201. html. Berne Convention for the Protection of Literary and Artistic Works of September 9, 1886: http://www. wipo.int/treaties/en/text.jsp?file_id¼283698. http://www.wipo.int/treaties/en/text.jsp?file_id¼295166. https://www.wto.org/english/docs_e/legal_e/31bis_trips_01_e.htm.

Intellectual property

89

confidentiality clauses included in the contracts of employees and business partners having access to the confidential information. It is also important to note that a trade secret does not provide an exclusive right for its commercial use. If it is embedded in the product, the competition can “break” the secret and consequently use the information commercially. Thus, if the trade secret becomes publicly known, anybody can use it for commercial or any other purpose. Even though the degree of protection extended to trade secrets varies across different countries, generally it is lower than the degree of the patent protection. When deciding on the appropriate form of intellectual property protection, smalland medium-sized enterprises frequently rely on the use of trade secrets. However, as pointed out earlier, this is not always the best strategy to follow. When deciding between the trade secret and the patent protection, the advantages and disadvantages of each of these should be carefully considered. Businesses should decide whether the innovation meets the criteria of its patentability. Some information, which has the characteristics of the trade secret, e.g., the list of business customers, is not suitable for patenting. If the information is patentable, then the choice of an appropriate alternative should be carefully considered. As stated earlier, compared with patents, the advantage of trade secrets is that they do not require formal registration, and thus, the protection using trade secrets is less costly. This advantage may be a decisive factor for choosing this alternative by small firms. Also, unlike patents, the trade secret type of protection becomes effective immediately; meanwhile, the granting of the patent right requires a relatively long period of time.

5.3

Historical development of the intellectual property protection

Individual forms of intellectual property were protected since several centuries ago. In this section, we briefly look at not only the historical developments of main forms of intellectual property and its protection, which helps us to better understand the current state of the intellectual property protection, but also the development of individual form of the intellectual property.

5.3.1

Patents

Even though there are indications that the roots of the patent like protection can be traced back to ancient Greece, the first patent systems were introduced in middle ages. The word patent comes from the Latin language “litterae patentes,” which means a patent letter. In middle ages, such letters were used by monarchs to award exclusive rights to individuals to produce specific goods or services. The examples of these can be found in Italy, France, or England. The first system of the patent protection related to the technology was introduced in Italy in the middle of the 15th century, when patents were granted to Venetian glassmakers to protect their innovative production methods, which were used to produce unique Venetian glassware. It is generally agreed that in 1474 the Venetian Republic

90

Start-Up Creation

introduced the first patent system in Europe known as the Venetian Patent Statute. According to it, patents could be granted on new and useful products. As Venetian glassmakers exported their glassware, or moved to other countries, they also sought similar type of protection there. At the beginning of the 18th century, the patent law was further elaborated in England during the reign of Queen Anne. It was required that the specification of the innovation was provided in a written form. Also, since then, patents could be granted not only on new products but also on the improvements of already existing products. This system became the basis for the development of the patent legislation in other countries, in the first place, in those being under the rule of England. However, in the 18th century, the patent legislation was introduced also in France, the United States, and other countries. During this period, the industry was developing dynamically, numerous innovations were introduced, and thus, the new patent legislation was elaborated so as to meet the requirements of the developing industrial societies. In the 19th century, the Paris Convention adopted in 1883 provided the basis for the international patent protection, and thus, the international standards of patent protection replaced patent rules fragmented across individual countries.

5.3.2

Trademarks

The history of trademarks goes back to the ancient period, when stamps and seals were used to stamp some goods. These can be considered as predecessors of current trademarks. Thus, looking at the development of forms of intellectual property from the historical perspective, trademarks can be perceived as its oldest form. On one hand, seals and stamps were to indicate quality; on the other hand, they also informed people about the origin of the product they could turn to if there was a problem related, e.g., to its quality. Since long time ago also, farmers stamped their animals so as their property could be easily identified. During the period of Roman Empire, local blacksmiths identified the origin of their products on the swords, which they produced. The formation of guilds in the middle ages led to the spread of trademarks on the products produced in guilds (e.g., bells, paper, etc.). As guilds built up their reputation, their marks became the way to communicate the quality to their customers. The first trademark legislation was passed in the 13th century in England, which required bakers to use a distinctive mark for their bread. In the 14th century, silversmiths and later on also other producers were required to mark their products. More comprehensive trademark legislation was introduced in England at the end of the 19th century only. Subsequently, it was adopted in France, England, and the United States. The legislation established not only the procedures for the trademark application but also the rights of trademark holders. Since then, the use of the trademarks has spread to virtually any industry and territory and has become an important factor of the business competitiveness. In the course of the development of trademarks, in the first place, their legislative protection relied on the common law, even though in some countries special trademark legislation was also introduced (e.g., in England, the United States, Japan, France). The Paris Convention also set international standards of the trademark protection.

Intellectual property

91

Counterfeit products experienced the boom with the increasing popularity of different brand names. They represent large industry, and they force producers of the original branded products to sacrifice a large fraction of their revenues. Even though counterfeiting is legally prosecuted, so far, this problem has not been sufficiently dealt with. The increase of the production of counterfeited goods led to the effort to introduce a comprehensive international legislation aimed specifically at the protection of trademark owners against counterfeiting. As it is explained further, so far the complex nature of the issue has not led to the resolution of this problem in the global context.

5.3.3

Copyrights

Before the development of the printing machines, the protection of intellectual property embedded in books did not represent a more serious problem. The multiplication of books required their rewriting, which was very time-consuming. However, the invention of the printing machines in the 15th century also brought forward the need to develop an appropriate form of the copyright protection of printed works, since these new machines provided an opportunity for their uncontrolled multiplication. On the other hand, they also facilitated the access of printed materials to a much larger audience. The copyright protection, which was subsequently introduced, was based on the practice that authors would provide to the publisher exclusive rights to copy their work for a limited period of time. After the expiration of this period, the copyrighted material became freely accessible. The first comprehensive copyright law was the Statute of Anne introduced in England in 1709. On the basis of this Act, authors, not publishers, were recognized as the owners of the copyrights of their work, and the Act also specified the conditions for the copyright protection. The authors were required to deposit their published works in copyright libraries and register them. The unpublished works were not protected by this legislation. After the period of the copyright protection expired, the copyrighted material became a part of the public domain. The Statute provided the basis for the development of the copyright legislation in other countries, and it is still referred to up to these days. The purpose of the introduction of the copyrights was to maximize the utility of authors and, at the same time, to meet the social objectives. On one hand, copyrights were aimed to provide incentives to produce intellectual property; on the other hand, they were to ensure the penetration of the published work among public. Limited duration of the copyright protection was aimed at addressing the contradiction between the incentives to produce intellectual property and the effort to ensure its widest possible penetration. The issue of fair use of copyrighted material was also taken into account throughout the development of the copyright legislation, and free use of protected material was advocated under specific circumstances (e.g., for the public purpose). Berne Convention brought also an internationally coordinated approach to the copyright legislation. The Convention stipulated that it was not necessary to register works protected by copyrights in individual countries, it provided the basis for mutual recognition of copyrights across countries, and the protection was also extended to unpublished work. This regulation was adopted by the majority of countries. It has provided the basis for the international copyright legislation up to the current period.

92

Start-Up Creation

The creation of the new photocopying technology facilitated further inexpensive multiplication of printed materials and created the need for the new regulation. It also put pressure on publishers threatening that they would lose large part of their market if illegal copying of printed works was not dealt with. The technological development increased the challenges linked to the copyright protection of intellectual property embedded in audio and video carriers. The development of videocassette recorders facilitated the copying of the video production. In the area of the video sharing, the development of MP3s facilitated the file sharing, and the copyright owners did not have adequate tools to fight against the breach of their copyrights. At the beginning, there was an effort to stop the production of the new carrier products to address this situation. However, it was soon realized that such solution was not possible and not the technology, but illegal behavior had to be limited. In recent decades, the development of Internet and Internet sharing platforms have further shaken the copyright protection and intensified the arguments for open access and sharing of copyrighted material. Even though new technologies did not lead to the destruction of the underlying intellectual property protection, they contributed to substantially higher prices of the original products. The owners expected that after their initial sale, subsequent copying will decrease their sales and revenues and tried to mitigate this impact by higher prices of the original products.17

5.4

Regulatory aspects of intellectual property protection in the historical perspective

The objective of the standard intellectual property legislation is to create incentives for investment in R&D, to promote innovation and creativity, and to ensure adequate return from resources invested into the innovation process for innovating firms. On the other hand, the protection of intellectual property rights potentially creates economic inefficiencies by limiting excess to information, the spread of which would not require additional cost and it limits competition. The infringement of intellectual property rights refers to their violation and may be prosecuted in line with the civil or criminal law, depending on the type of intellectual property concerned and the local legislation. In case of trade secrets, their misappropriation is related to the violation of the confidentiality of information. In case of patents and other forms of formally protected intellectual property, the information on the characteristics of the innovation is registered and publicly available. Thus, the patent infringement would take place if a patented invention was used or sold without the permission of the patent holder. However, in many countries (with the exception of, e.g., the United States), the use of patented inventions for research purposes is permitted.

17

See a more detailed discussion of the historical development of intellectual property protection, e.g., in: Sell (2004).

Intellectual property

93

In the subsequent text, we discuss international regulatory framework, which has increased the harmonization of fragmented national regulation of intellectual property rights, and in some cases, it also allowed for their international or regional protection. In today’s world, when seeking to protect the intellectual property, it is not sufficient that businesses concentrated on one country only. They need to be aware of the global regulatory framework, since many firms operate across national borders. This is even more so in the area of intellectual property rights protection, since new information technologies interconnecting the continents allow to spread the information at minimum cost, and it has become more problematic to protect it. Then, we briefly describe key regulatory framework in Europe.

5.4.1

International framework of the protection of intellectual property rights

The national legislation related to the intellectual property protection varies in individual countries. However, there exist a number of international intellectual property agreements and conventions that facilitate the harmonization of the legislation in the international context. In these processes, the WIPO plays an important role, especially with regard to the harmonization of individual forms of the intellectual property protection. The increasing globalization of trade contributes to an increasing role of the World Trade Organization (WTO) also in the area of the intellectual property protection.18 As regards the regulatory framework in the area of different forms of intellectual property protection, the most comprehensive international agreement on intellectual property rights is the TRIPS Agreement.19,20 It came into effect on January 1, 1995. TRIPS Agreement sets minimum standards of protection, which have to be ensured by each of its signatories. Thus, adhering to the minimum requirements specified by TRIPS Agreement, signatory countries can decide to implement larger protection of the intellectual property rights on their territory. The Agreement also specifies core principles applicable in the intellectual property rights enforcement. It stipulates that the disputes related to the TRIPS Agreement should be subject to the WTO’s dispute settlement procedures. The stipulations of the Agreement apply equally to all signatory countries, but developing countries have been allowed a longer period for adjustment. Also, each country can decide itself on the ways that the provisions of the Agreement are to be implemented on its territory. TRIPS sets the minimum standards for different forms of intellectual property protection (copyrights and related rights, industrial designs, trademarks and trade secrets, and also new plants). The agreement was agreed upon within the round of discussions of the General Agreement on Tariffs and Trade in 1994. TRIPS is based upon previously introduced international agreements related to the intellectual property protection (e.g., Berne convention). It introduces further 18

19 20

A more detailed discussion of global aspects of intellectual property protection can be found in Maskus (2000). http://www.wto.org/english/docs_e/legal_e/legal_e.htm#TRIPs. https://www.wto.org/english/docs_e/legal_e/27-trips.pdf.

94

Start-Up Creation

specifications of types of intellectual property and of the enforcement procedures. The TRIPS Agreement requires that the stipulations of Paris and of Berne conventions are complied with. On one hand, the aim of TRIPS is to promote innovation and, on the other hand, to create conditions facilitating its transfer and dissemination. TRIPS Agreement sets out minimum standards of protection, which have to be provided by each of its signatories. Thus, adhering to the minimum requirements specified by TRIPS, signatory countries can decide to implement larger protection of the intellectual property rights on their territory. The Agreement also specifies core principles applicable with regard to the intellectual property rights enforcement. It stipulates that the disputes related to the TRIPS Agreement should be subject to the WTO’s dispute settlement procedures. The stipulations of the Agreement apply equally to all signatory countries, but developing countries have been allowed longer period for adjustment. Also, each country can decide itself on the ways the provisions of the Agreement are to be implemented on its territory. The TRIPS Agreement has been criticized mainly based on its adverse impact on developing countries, which are required to enforce the same standards of intellectual property protection as developed country. The basis for criticism has been based on the redistribution of wealth from developing countries to owners of patents and other forms of intellectual property. Also, it has been pointed out that the TRIPS Agreement can undermine adaptation of new technologies by developing countries. Also, based on this criticism, the amendment entered into force in January 2017, which facilitates that these countries can access affordable generic medicines under the WTO regime.21 Historically, the Paris Convention for the Protection of Industrial Property,22 which was adopted in 1883, was the first major agreement to ensure the protection of different intellectual property rights (including patents, utility models, trademarks, and industrial designs) internationally. Subsequently, it was revised periodically. The last revision took place in 1967 and was amended in 1979. The Convention stipulates that each signatory state must grant the same protection to citizens of another signatory state as it grants to its own citizens. It also introduced the right of priority, when individuals, after submitting the application in one state, have the time period of 6 (or 12) months to seek the protection in other countries. Thus, it is not necessary to file the application at the same time in all countries, where the intellectual property protection is sought, but the applicant has the time of up to 12 months to apply for the protection in other countries. The Convention also specifies common rules related to individual types of intellectual property, which each signatory state has to adhere to. At the end of 19th century (in 1886), the Berne Convention for the Protection of Literary and Artistic Works23 came to force. Since then, it has undergone several revisions, the last of them being agreed upon in Paris in 1971 and amended in 1979. The Convention provides authors, musicians, poets, and painters with the right to control the use of their works. It stipulates main principles of the protection, and the

21 22 23

https://www.wto.org/english/news_e/news17_e/trip_23jan17_e.htm. http://www.wipo.int/treaties/en/text.jsp?file_id=288514. http://www.wipo.int/treaties/en/text.jsp?file_id¼283698.

Intellectual property

95

authors are to be provided the same protection in every signatory state. Thus, if the work originates from a signatory state of the agreement, it is provided automatically. The protection must be provided for a minimum of 50 years after the death of the author. However, in the case of applied art and photographic works, the minimum term of protection is 25 years from the creation of the work. Individual countries frequently provide longer copyright protection than stipulated by Berne Convention. Berne Convention also specifies provisions for the free use of the types of intellectual property it covers. Some countries still require the registration of copyrights, since the registration facilitates the investigation in case of any arising disputes related to the copyright protection. The Intellectual Property Rights Office (IPRO) was established to facilitate the international registration of copyrights. Its Copyright Registration Service serves as a depositary of unpublished work originating in signatory countries of Berne Convention. A specific agreement under the Berne Convention is the WIPO Copyright Treaty24 of 1996, which entered into force in 2002. It deals with the protection of intellectual property in the digital form including computer programs and databases. Next to the rights of intellectual property owners as specified by the Berne Convention, it grants the authors the rights to distribute originals and copies of their works through the transfer of ownership and specifies conditions for their commercial rental. Also, it provides owners the right to communicate the works to the public, so that they can be accessed by the public individually, using different channels including the Internet. The minimum duration of the protection is set at 50 years. In the area of the copyright protection, another principal regulation was adopted within the UNESCO in 1952. It is the Universal Copyright Convention,25 which came to force in 1955 and was revised in 1971, and since then, the revised version of the Convention has been used. The aim of the Convention was to extend the international copyright protection to all countries. The Convention requires that equal protection of copyrights is provided to all authors regardless if they come from the same or other signatory countries. It also requires identifying the copyrighted work with the symbol ©, with the name of the copyright owner, and with the year, when the work was first published. It stipulates that the minimum term of the copyright protection in any signatory country must be 25 years after the death of the author; in case of photographic works and applied art, the protection is specified to be 10 years after the death of the author. Except for the Berne Convention, the stipulations of the Universal Copyright Convention have the priority over other copyrights legislation. However, most countries are signatories of the Berne Convention, which limits the applicability of the Universal Copyright Convention. The revisions not only of the Universal Copyright Convention, but also of the Berne Convention in 1971, were prepared, so as special needs of developing countries were taken into consideration with regard to copyrighted works.

24 25

http://www.wipo.int/treaties/en/text.jsp?file_id¼295166. http://portal.unesco.org/en/ev.php-URL_ID¼15381&URL_DO¼DO_TOPIC&URL_SECTION¼201. html.

96

Start-Up Creation

International regulation also pays attention to the problem of counterfeit goods. Even though the problem has gained more attention with the spread of branding and growing demand for popular brands in recent decades, it was addressed at international level already at the end of the 19th century. The Madrid Agreement for the Repression of False or Deceptive Indications of Source on Goods26 was concluded in 1891. Similar to other earlier agreements, since then, it has undergone several revisions with the last one taking place in 1967. According to this Agreement, those goods that bear a false or deceptive indication of their source by which one of the signatory countries is directly or indirectly indicated as being the country of origin must be confiscated at the import point, or their import should be prohibited. Recently, the Anti-Counterfeiting Trade Agreement (ACTA) was prepared as the legal act aimed at fighting the infringement of intellectual property rights related to the counterfeiting and piracy in the global context. Building upon the minimum standards introduced by TRIPS Agreement, ACTA establishes strengthened standards for the protection in this area. The agreement was signed by signatory parties in 2011. However, for the Agreement to enter into force, it is required that the parties include into their legislation relevant penalties for the infringement of intellectual property rights concerned. In the European Union, the implementation of ACTA was rejected by the European Parliament in 2012. The ACTA Agreement led to substantial criticism from different stakeholder groups including civil society in Europe and in other parts of the world. It was pointed out that foreseen benefits of the Agreement are outweighed by potential related cost, especially with regard to their adverse impact on civil rights, including freedom of expression and privacy in communication. Building upon previously introduced international regulation, the patent protection is specifically concerned by the Patent Law Treaty,27 which was adopted in 2000 and came into force in 2005. Its aim is to harmonize and streamline formal procedures with respect to dealing with national and regional patents and with patent applications. With the exception of filing date requirements, which are not regulated by the Treaty, the Treaty stipulates maximum requirements, which can be applied by signatory countries. Based on the specifications provided by the Treaty, the procedures used by patent offices were simplified. This contributed to the decreased costs for patent applicants. The Treaty also aims to facilitate the electronic filing of patent applications, but in specified cases, the paper submissions are also requested to be accepted. The international protection of intellectual property rights in the area of trademarks is stipulated by the Trademark Law Treaty,28 which was concluded in 1994. The standards introduced by this Treaty are related to the application for the trademark registration, to the changes in the trademarks after they were registered, and also with regard to the renewal of the registration. The requirements for each of these aspects are set to contribute to the simplification of these procedures.

26 27 28

http://www.wipo.int/treaties/en/text.jsp?file_id¼286779. http://www.wipo.int/treaties/en/text.jsp?file_id¼288996. http://www.wipo.int/treaties/en/text.jsp?file_id¼294357.

Intellectual property

97

The Hague Agreement29 concerning the international registration of industrial design represents a specific agreement related to the establishment of the Hague system of international protection of the industrial design. It was first adopted in 1925, and since then, it has been revised several times. Currently, its 1960 and 1999 revisions are applied. Since the beginning of 2019, new Administrative Instructions for the Application of the Hague Agreement has been in force. The industrial design protection is based on the registration of the industrial design using the application with the WIPO. In such a way, the formalities for the international protection of the industrial design are reduced not only for the first design registration but also for the renewal of the registration and the recording of possible changes. The protection is provided for the period of 5 years, and it is renewable for a minimum of one 5-year period (according to the 1960 Act) or two 5-year periods (according to the 1999 Act).

5.4.2

Intellectual property protection in the European Union

In the area of intellectual property, in Europe, there are two key designated organizations, which are responsible for addressing different aspects of the intellectual property protection. These are the EUIPO30 and the EPO.31 These organizations are responsible for the progress of the harmonization in the area of the intellectual property rights protection in the European Union and the implementation of relevant directives and regulations. EUIPO is responsible for managing the EU trademark and the RCD. The EPO examines European patent applications to obtain protection in the signatory stated using a centralized and uniform procedure. The EPO has 38 member states including 28 member states of the European Union. In the European Union, several directives were introduced to facilitate the processes of strengthening the intellectual property protection in the Union. The Directive 2001/ 29/EC of the European Parliament and of the Council of May 22, 2001,32 is related to the harmonization of certain aspects of copyright and related rights in the information society in the framework of the internal market. The Directive 2004/48/EC of the European Parliament and of the Council of April 29, 2004, on the enforcement of intellectual property rights33 aims at establishing the procedures to ensure the enforcement of intellectual property rights including rights related to the industrial property. The harmonization in the European Union has progressed also with regard to the trademark registration, when, by submitting a single application, European firms can obtain protection of their trademarks not only throughout the European Union

29 30 31 32 33

http://www.wipo.int/hague/en/legal_texts/. https://euipo.europa.eu/ohimportal/en/home. https://www.epo.org/index.html. http://eur-lex.europa.eu/legal-content/EN/TXT/?uri¼celex:32001L0029. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri¼CELEX%3A32004L0048.

98

Start-Up Creation

but also in countries that are signatory of the Madrid Protocol.34 Also, the entities having the international registration under the Madrid Protocol may apply for the protection of their trademarks in the European Union under the European trademark system. Thus, the firms carrying out their business in the European Union can use the Community trademark, which allows them to make their products distinctive on the European Union territory. The European trademark system provides uniform protection, which allows the owner to prevent another entity to use the trademark for the same products or services. Also, the use of the trademark in case of similar products is to be forbidden if a possible confusion could arise. The community trademark is registered for a period of 10 years, and it is renewable. In the European Union, there is a dual system in place, which allows for the European or national registration of trademarks. These are complementary; thus, companies can choose the suitable protection fitting their needs. The industrial property is protected by the Directive 98/71 of the European Parliament and of the Council of October 13, 1998, on the legal protection of designs.35 The Council Regulation No. 6/2002 of 200136 establishes the basis for the protection of industrial design using the community design, which provides unified protection on the territory of the European Union. The EPO, which is not bound to the European Union, but has broader European character, allows for a single application for the European patent. However, after the European patent is granted, it has to be validated in each member state, where the protection is sought. That is linked to further costs related, e.g., to the need to translate the application documents into relevant national languages and costs related to filing the patent application at national level. Thus, there has been an effort to progress toward the unified patent, which would provide protection on the European Union territory and allow reducing cost of patent protection in Europe. In December 2012, the European Parliament approved two regulations (EU 1257/2012 and EU 1260/ 2012) that allow for the unitary patent protection. The protection can be obtained so as it covers all European Union member states, except for Italy, Spain, and Croatia, without the need for further national validation. These regulations of the European Parliament entered into force in January 2013. The Agreement on a Unified Patent Court37 was signed by all EU countries except for Spain and Poland.38 As of 2019, the establishment of the Unified Patent Court is at the preparatory stage.39 Unitary patents will be accepted in English, French, or German, and no further translation will be required after they are granted. Unitary patent protection is to make the patent 34

35 36 37 38

39

The text of the Protocol is available at http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri¼CELEX: 22003A1114(01):EN:HTML, and the related decision of the European Council is available at http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri¼CELEX:32003D0793:EN:HTML. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri¼CELEX%3A31998L0071. http://eur-lex.europa.eu/legal-content/EN/TXT/?uri¼URISERV:l26033. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri¼CELEX%3A42013A0620%2801%29. By September 2019, the Agreement was ratified by 16 countries. For the update on its ratification, see http://www.consilium.europa.eu/en/documents-publications/agreementsconventions/agreement/? aid¼2013001. The website of the organization is https://www.unified-patent-court.org/.

Intellectual property

99

system in the European Union easier, less costly, and legally secure. It is to be available to entities, which want to protect their innovations in the countries of the European Union, regardless of their nationality or the place of residence. European Union pays attention also to the protection of biotechnological inventions (Directive 98/44/EC of the European Parliament and of the Council of July 6, 1998, on the Legal Protection of biotechnological inventions, Regulation No. 1610/96 of the European Parliament and of the Council of July 23, 1996, concerning the creation of a supplementary protection certificate for plant protection products), which become a more pressing issue with the rapid development of biotechnologies, which took place in recent years. In November 2017, the European Commission adopted the single market strategy40and the digital single market strategy,41 which also includes measures to further improve the enforcement of intellectual property rights, to overcome the fragmentation of the intellectual property protection in the European Union, and to strengthen the fight against counterfeiting and piracy and aims to progress toward the attractive, affordable, and efficient intellectual property rights system, which would be globally competitive. In case of start-ups and their effort to protect their intellectual property rights, the financial and human resources can represent a problem. There is the scope for the public sector institutions to contribute to building up capacities by the intellectual property consultancy and training. In Europe, the creation of innovative start-ups has been supported from European and regional schemes, such as Horizon 2020.

5.5

Intellectual property protection at the crossroadsdcurrent perspectives

In this section, we reflect upon some of the recent developments in the area of intellectual property protection, with special focus on start-up businesses. We specifically focus on the patent protection and licensing, since some of the recent research in the field sheds new light on the pros and cons of the existing system of the patent protection. This type of protection is also most frequently relevant for start-up businesses. The interlinkage between research and its impact on actual innovation has also received growing attention. Since research activities require substantial resources, there has been effort to study their effects and impact of their outcomes on the innovation potential of firms and societies. Nevertheless, a comprehensive way how this can be measured represents a challenging problem, which so far has not been satisfactorily addressed. However, the effort to develop such measurement system has led to new proposals to provide adequate proxy of this impact. For example, Jefferson et al. (2018) interconnected scholarly citations with global patent literature and developed tools, which enable to evaluate the influence that published research has on 40 41

https://ec.europa.eu/growth/single-market/strategy_en. https://ec.europa.eu/digital-single-market/.

100

Start-Up Creation

inventions reflected in the patents. The maps that they have created allow to show which scientific results, scientists, and potentially also institutions influenced the innovation activities and to what extent. Poege et al. (2019) carried out a large-scale matching exercise between 4.8 million patent families and 43 million publication records and found a strong positive relationship between quality of scientific contributions referenced in patents and the value of the respective inventions. Their results imply that academic quality reflected in academic publications coincides with excellent outcomes in technological and commercial areas. However, the innovativeness of businesses affects also economic performance of a country, and in the current period, it is considered a source of economic growth. Meng and Chen (2019) pointed out that, during recessions, there is lack of innovations, which undermines the potential for economic recovery of the country. They argue for the reform of the existing patent systems to reduce the monopoly steaming from the patent protection to facilitate the diffusion of new technologies and to support the innovation potential and would facilitate faster and smoother economic growth. The suggested stepping stones of newly developed patent system would be based on the redefinition of the patent rights, banning exclusive patent licenses and patent assignments, and standardization of patent licenses. Also, they propose that the patent duration was infinitely prolonged, and the quality standards of patents increased. Lerner (2002) studied 177 of the most significant shifts in patent policy across 60 countries over 150 years. He concluded that after having adjusted for the change in overall patenting, the impact of patent protection-enhancing shifts on applications by residents was actually negative. Even though this study has limitations based on the measures used, it indicates that the strengthening of the patent protection can actually undermine the innovation activity of business. Even though some studies demonstrated considerable overall positive effects of the intellectual property protection system (see e.g., Bloom and Van Reenen, 2002; and Hall et al., 2007; Schneider, 2005), the voices that the strong intellectual property systems undermine innovation have gained strength in recent decades. The notion that a good intellectual property protection system serves as a stimulus for innovation has been challenged by a growing predominantly empirical literature based on the US data.42 In their study, Boldrin and Levine (2013) pointed out that even though a properly designed patent system might contribute to increasing innovation in a specific location and in a time period, the empirical evidence failed to provide clear justification of the notion that patents encourage innovation or productivity. They proposed that the patents were abolished, or alternative legislative instruments were found, which would be less prone to lobbying and rent seeking. At the same time, they pointed out that some areas were more prone to the problems related to the patent system (e.g., software or business method patents). Sweet and Eterovic (2019) studied the effects of patent rights systems on total factor productivity growth, using dynamic panel regression

42

See, e.g., Jaffe, A.B., 2000. The US patent system in transition: policy innovation and the innovation process. Research Policy 29 (4), 531e557; Boldrin, M., Levine, D. K., 2013. The case against patents. The Journal of Economic Perspectives, 27 (1), 3e22.

Intellectual property

101

analysis for 70 countries for the period between 1965 and 2009. In their study, the effects of stronger or more rigorous patent systems did not prove significant for the productivity growth regardless, whether developing or industrialized countries were considered. They concluded that technological application of innovations seems to be more important for productivity growth than strong intellectual property rights. The understanding of the impact of patenting on innovation can be enhanced by understanding the incentives of businesses to opt for it or to decide not to patent their technologies. The results of the Berkley Patent Survey carried out in 2008 among top managers of more than 15,000 US entrepreneurial companies pointed out that substantial number of surveyed companies opted for the patent protection (Sichelman, 2012). However, when trying to identify motives behind the use of patenting, it was revealed that firms did not seek the patent protection so as to secure high profit, but to strengthen their negotiating position with investors. According to this study, investors attribute high value on companies with patents and also strive to secure the competitive advantage brought by the new technology they have patents for. On the other hand, the Berkley survey did not confirm that patents would provide strong incentives for increased innovation activities of businesses. Also, with respect to start-up businesses, high cost of the patent enforcement and of the protection against infringement was identified as the factor diminishing their incentives to seek the patent protection as such. The cross-sectorial study carried out among more than 9000 start-ups in the United States (Lerman, 2015) confirmed the positive correlation between the venture funding raised by start-ups and the number of patents filed by them. Thus, patents held by start-ups represent one of the factors that influence investors’ decisions about which start-up they would invest into. The study also pointed to a very active patent behavior of start-ups at the beginning of their existence, which can be explained by their effort to attract venture funding. However, this can also reflect more intensive innovation activities at early stages of the start-up existence. But the anecdotal evidence also indicates that investors may perceive an early filing of patent applications by start-ups negatively, and consider it as spending scarce resources, which at an early stage of the existence of the business should be directed to other activities (Lerman, 2015). Lerman also looked at the territorial and sectorial distribution of patenting among US start-ups and concluded that Californian start-ups tended to patent more than those in other US regions. As for the sectorial differences, she indicated that start-ups in biotechnology, hardware, and medical industry were prone to patent significantly more than those in the software industry. In recent years, alternative forms of intellectual property protection were proposed, including the tendency to provide patents free of charge (Ziegler et al., 2014). This has become common in the software industry. In many cases, it was recognized that firms were motivated by economic reasons to provide free access to their innovative technology (i.e., software), since this way they were able to appropriate profit by the sale of their complementary products needed to use it. Also, free access to software protected by the copyrights was recognized to facilitate its further improvement and development, which was initiated by the comments from the software users. The donation of patents may be also motivated by other factors, e.g., moral reasons, effort to obtain tax deductions, or gain some other cost benefits. The establishment of the patent pools

102

Start-Up Creation

allowing the members of the pool to use their patents without any charge has also appeared as a new form of research and technological cooperation among entities. The examples of such cooperation initiatives may be Eco-patent Commons, the Medicines Patent Pool, or WIPO Re: Search initiative (Ziegler et al., 2014). When looking at this issue from the point of view of start-up businesses, some studies indicate that the patent protection is not vital for start-up companies during first years of their existence. Landers (2015) pointed out that, e.g., Facebook and Microsoft increased their patent holdings only after achieving commercial success. To address the disadvantages of the patent system for start-up businesses, Landers suggested to implement an antipatent system for small businesses of the start-up nature, which would allow the owner to opt out of the patent system for a minimum period of 20 years. The system would consist of two fundamental components: first, the participants would obtain immunity from the third party patent infringement assertions, and second, during the immunity time period the start-up would not acquire any liability for nonwillful infringement of any patents. The system could be based on an application to be submitted to the relevant patent office. If such a system was introduced, the start-up companies would have an option to decide whether it was more beneficial for them to opt from the patent protection or to opt out from the patent system altogether. The management of the intellectual property issues by start-ups should also take into account the activities of so-called patent trolls, which recently received a growing attention in the literature. Patent trolls, or nonpracticing entities, do not produce any products but make money from licensing or asserting patents against entities that produce the products. Their activities have been interpreted as the proof of the deficiencies of the existing patent system. Patent trolls are active in the area of litigation, or they threaten businesses with litigation. They often buy patents from bankrupt companies and follow up with the use of the technology protected by these patents. In case of spotting the nonlicensed use of the technology, they engage in litigation. Increased propensity of patenting activities in recent decades also increased the complexity of the existing situation. Another related problem is linked to the fact that under the existing patent system, also only broad ideas are patentable. These ideas can be further elaborated by other companies without them realizing that the technology is actually under the patent protection. A patent troll may send a company the claim for the infringement of the patent and request to pay a licensing fee. According to Lemley and Melamed (2013) in the past few years patent, trolls filed about half of the patent suits. They are active especially in the computer and telecommunication industries. They do not contribute to innovation but potentially obtain large settlements from costly lawsuits. In their empirical study carried out among in-house attorneys of the companies producing products using the new technology in different industries, Feldman and Lemley (2015) looked at the impact of licensing demands on new innovation activities. Their results point out that, except for the pharmaceutical industry, in most cases, firms, which were targeted by the lawsuits, developed the technology independently and were paying the licensing fee to the patent troll not to be sued for the use of the technology, which in reality they did not copy. They decided to pay for the license anyhow, since the patent litigation is expensive and timeconsuming. Feldman and Lemley also concluded that the patent licensing activities did

Intellectual property

103

not lead to substantial technology transfer. This can be explained by the fact that the patent demands usually take place only after the technology proves to be successful. However, the technology transfer usually happens, when the technology is new. Thus, it usually takes place in the form of collaboration, informal transfer of knowhow and not licensing of patents as such. In their study of the determinants of patent suits and settlements during 1978e99 in the United States, Lanjouw and Schankerman (2004) found that the litigation risk is much higher for patents that are owned by individuals and firms with small patent portfolios. At the same time, the financial impact of patent litigation is larger for small firms due to their limited financing and the lack of internal expertise to deal with the litigation cases.43 Start-up businesses are also more exposed to the threat of litigation, perhaps, except for the pharmaceutical and chemical patentable subject areas, since they have limited resources to investigate the situation with regard to the patent protection and finding out about the need for licensing. Moreover, the production of new products may require licensing many patents, which further increases the complexity of the matter. Also, the complexity of current technologies can be a factor diminishing the effort of start-ups to license a new technology, not only because of potentially high cost of licensing but also because the inherent uncertainty about what licenses are needed further increases the complexity of the issue.

5.6

Discussion

Even though the intellectual property and its protection have long history, due to recent technological change and globalization processes, in recent decades, these issues have received growing attention. Also, in changed conditions, the intellectual propertye related transactions gained new character. In case of any market transaction of private goods, it is necessary to establish the means of the exchange and to preclude consumers from consuming the good without paying for it. However, innovations are largely characterized by their largely nonexclusive and nonrival character and thus do not meet the characteristics of private goods. Nobody can be excluded from their consumption once they are made publicly available, and additional cost of their consumption by an additional user is zero or close to zero. Once the innovation becomes known, it is there available to everyone. Thus, if owners of an innovation want to ensure the return on resources invested in their development, they have to find ways to increase the transaction costs of free riding and the way to make it less beneficial. The transaction cost can be increased using private market solutions (e.g., by developing the technology, which makes it harder to get free access to the innovation) or existing enforcement mechanisms (i.e., legal protection). At the same time, the literature indicates that restricted access to innovation imposed by the legal protection, or by the characteristic features of innovation itself, can undermine innovativeness of the economy and its growth potential. The state of the discussion 43

See Lerner (1995) for the conclusions based on the analysis of new biotechnology firms.

104

Start-Up Creation

indicates that the time for pushing for new alternative solutions to promote the innovativeness of our societies has come and policy makers should start to think beyond the standard approaches of trying to strengthen the protectionism of innovations. Meanwhile, if there are any changes introduced to existing intellectual property systems, businesses need to make sure that they are aware of the rules of existing regulatory framework in the region they operate or globally. They should understand that optimal choice of the protection of innovations depends on different factors, such as the type and character of an innovation, foreseen market dynamics, and also the geographical area a firm operates in. As shown earlier, changed business environment impacts on different aspects of the intellectual property protection, which also affects business strategies of start-up businesses and optimal ways to address the intellectual property rights issues by them.

References Bloom, N., Van Reenen, J., 2002. Patents, real options and firm performance. The Economic Journal 112 (478), C97eC116. Boldrin, M., Levine, D.K., 2013. The case against patents. The Journal of Economic Perspectives 27 (1), 3e22. Feldman, R., Lemley, M.A., 2015. Do patent licencing demands mean innovation?. In: Stanford Law and Economics Olin Working Paper No. 473, Stanford Public Law. Working Paper No. 2565292, UC Hastings Research Paper No. 135. Available online: http://papers.ssrn. com/sol3/papers.cfm?abstract_id¼2565292#%23. Hall, B.H., Thoma, G., Torrisi, S., August 2007. The market value of patents and R&D: evidence from European firms. Academy of Management Proceedings 2007 (1), 1e6. Briarcliff Manor, NY 10510: Academy of Management. Hall, B.H., Helmers, C., Rogers, M., Sena, V., 2012. The choice between formal and informal intellectual property: a literature review. In: NBER Working Paper Series, Working Paper No. w17983. Cambridge, MA, p. 35. Jaffe, A.B., 2000. The US patent system in transition: policy innovation and the innovation process. Research Policy 29 (4), 531e557. Jefferson, O.A., Jaffe, A., Ashton, D., Warren, B., Koellhofer, D., Dulleck, U., Ballagh, A., Moe, J., DiCuccio, M., Ward, K., Bilder, G., 2018. Mapping the global influence of published research on industry and innovation. Nature Biotechnology 36 (1), 31. Landers, A.L., 2015. The antipatent: a proposal for startup immunity. Nebraska Law Review 93 (4). Article 5. Available online: https://pdfs.semanticscholar.org/0128/ 362799857442aabef8067b0720199a5163c4.pdf. Lanjouw, J.O., Schankerman, M., 2004. Protecting intellectual property rights: are small firms handicapped? The Journal of Law and Economics 47 (1), 45e74. Lemley, M.A., 2005. Property, intellectual property, and free riding. Texas Law Review 83, 1031. Available online: http://papers.ssrn.com/sol3/papers.cfm?abstract_id¼582602. Lemley, M.A., Melamed, A.D., 2013. Missing the Forest for the Trolls, 113 Column. Law Review 20117, pp. 2118e2121. Lerman, C., 2015. Patent Strategies of Technology Startups: An Empirical Study. SSRN 2610433. Available at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id¼2610433.

Intellectual property

105

Lerner, J., 1995. Patenting in the shadow of competitors. The Journal of Law and Economics 38 (2), 463e495. Lerner, J., 2002. 150 years of patent protection. The American Economic Review 92 (2), 221e225. Maskus, K.E., 2000. Intellectual Property Rights in the Global Economy. Peterson Institute. Meng, S., Chen, G.S., 2019. A new patent system to usher in a new economy. Economics of Innovation and New Technology 28 (8), 775e797. https://doi.org/10.1080/ 10438599.2018.1557428. Poege, F., Harhoff, D., Gaessler, F., Baruffaldi, S., 2019. Science Quality and the Value of Inventions arXiv preprint arXiv:1903.05020. Poticha, D., Duncan, M.W., 2019. Intellectual propertydthe Foundation of Innovation: a scientist’s guide to intellectual property. Journal of Mass Spectrometry 54 (3), 288e300. Rivera, K.G., Kline, D., 2000. Discovering New Value in Intellectual Property. Harvard business review, p. 55. Available online: https://hbr.org/2000/01/discovering-new-value-inintellectual-property. Schneider, P.H., 2005. International trade, economic growth and intellectual property rights: a panel data study of developed and developing countries. Journal of Development Economics 78 (2), 529e547. Sichelman, T., 2012. Startups&The Patent System: A Narrative. Available online: http://ssrn. com/abstract¼2029098. Sell, S., 2004. Intellectual property and public policy in historical perspective: contestation and settlement. Loyola of Los Angeles Law Review 38, 267e322. Sweet, C., Eterovic, D., 2019. Do patent rights matter? 40 years of innovation, complexity and productivity. World Development 115, 78e93. Ziegler, N., Gassmann, O., Friesike, S., 2014. Why Do Firms Give Away Their Patents for Free? World Patent Information, pp. 19e25. http://www.wipo.int/treaties/en/text.jsp?file_id¼283698. https://euipo.europa.eu/ohimportal/en/. http://portal.unesco.org/en/ev.php-URL_ID¼15381&URL_DO¼DO_TOPIC&URL_ SECTION¼201.html. https://ec.europa.eu/growth/single-market/strategy_en. https://ec.europa.eu/digital-single-market/. http://www.wipo.int/treaties/en/text.jsp?file_id¼295166. http://www.wipo.int/madrid/en/. http://www.wipo.int/treaties/en/text.jsp?file_id¼288996. http://www.wipo.int/treaties/en/text.jsp?file_id¼294357. https://www.wto.org/english/news_e/news17_e/trip_23jan17_e.htm. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri¼CELEX%3A42013A0620%2801%29. http://www.consilium.europa.eu/en/documents-publications/agreementsconventions/agreement/?aid¼2013001. https://www.unified-patent-court.org/.

CO2 sequestration on cement Shweta Goyal, Devender Sharma Thapar Institute of Engineering and Technology, Patiala, Punjab, India

6.1

6

Introduction

The levels of greenhouse gases in environment have been rising since the start of industrial era. The results of global warming are evident in melting of glaciers, increase in earth’s temperature, climate change, etc. The most dominant greenhouse gas is carbon dioxide (CO2), which is emitted mostly through burning of fossil fuels for energy, manufacturing industries, and construction activities. As per the report of the International Energy Agency (IEA), the global CO2 emissions rose by 1.7% in 2018 as compared with 2017 (IEA, 2018). In an effort to tackle the rising CO2 emissions, United Nations set up the United Nations Framework Convention on Climate Change (UNFCCC) in 1992. The objective of UNFCCC was to stabilize the atmospheric concentration of CO2 to a 1990 baseline. At the 21st conference of UNFCCC, known as Paris agreement, 175 countries agreed to make efforts to combat the threat of climate change by limiting the global temperature rise to 2 C with respect to the values registered during the preindustrial era. Many steps have been taken to counter rising greenhouse emissions and climate change by the nations involved in Paris agreement. It includes incorporating renewable sources of energy, use of biofuels in the transportation industry, reducing deforestation rates, etc. (National Public Radio, 2011). However, only reducing the future emissions is not sufficient to achieve the target of CO2 stabilization. Carbon capture and storage (CCS) or carbon sequestration is identified as one of the solutions to further mitigate higher levels of CO2. CO2 sequestration is described as long-term storage of atmospheric CO2 in stable forms to mitigate global warming and climate change. CO2 sequestration is done by capturing the atmospheric CO2 through biological, physical, and chemical processes and storing it in stable form for long term. Well-equipped CCS systems have the capacity to reduce the CO2 emissions by 80%e90% (IPCC, 2005). The global rise in carbon dioxide emissions comes from three main sources: (1) burning of fossil fuels, (2) land use changes or deforestation, and (3) decomposition of carbonates. Cement industry is the largest contributor to emissions from decomposition of carbonates. The production of cement emits CO2 in two forms. First is the burning of fossil fuels to generate sufficient energy required to heat all raw materials above 1000 C and also electrical energy required. Second, in production of clinker, CO2 gas is released during decomposition of carbonates into oxides and carbon dioxide. Both these processes contribute toward nearly 8% of global CO2 emissions (Andrew, 2018). Several earlier strategies to reduce CO2 emissions from cement production included using alternative materials and energy-saving production processes

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00006-0 Copyright © 2020 Elsevier Ltd. All rights reserved.

110

Start-Up Creation

(Mikulcic et al., 2013). However, rising demand of cement to cater infrastructure needs has made it difficult to attain 2 global warming scenario set by Paris agreement, by using the conventional CO2 reducing strategies. Clearly, there is an urgent need to find better and economic ways of carbon dioxide removal from atmosphere. The strategies for CO2 reduction can be brought into implementation only through the joint efforts of researchers and through active industrial participation. While the researchers are continuously making efforts for bringing innovative ways of CO2 sequestration, industrial start-ups focused on capturing greenhouse gases can provide the required push for further implementation of the developed technologies. The startups based on carbon free technology and incentives such as carbon offset credits have gained attention of funding agencies all over the world. Global Thermostat, Solidia Technologies, and Carbon Cure Technologies are few of the examples of start-ups looking at the ways to reduce CO2 from the atmosphere (Temple, 2019). Another such approach for mineral carbonation can be sequestration of CO2 in building materials. The concept is based on the ability of cement and its hydrated products to react with atmospheric CO2. It is well documented that the hydration products reach with atmospheric CO2 over time. The process of deliberately supplying CO2 to the cement system during very early ages of strength development is called accelerated carbonation curing (ACC). ACC is a type of mineral carbonation in which captured CO2 is stored in the form of stable inorganic carbonates. The process of ACC is carried out by exposing freshly cast concrete to high concentration of CO2 for a short duration. Carbonation of cement products is a direct way to sequester CO2 by converting it to geologically and chemically stable calcium carbonate. Utilization of CO2 in construction is not very new. Many studies have been conducted in the 1970s to explore the potential of cement as a carbon sink (Berger and Klemm, 1972; Goodbrake et al., 1979a; Klemm and Berger, 1972a; Young et al., 1974). The idea of ACC did not get much attention earlier when it was proposed as a curing regime due to high cost of CO2 capture and known deteriorating effects of CO2 on concrete. However, ACC has gained the interest of researchers over the past decade, owing to the latest developments in economical CO2 capture technologies and the urgency to mitigate CO2 emissions and global warming. This chapter discusses in detail the reaction mechanism of CO2 sequestration in cement-based materials and resulting products. A detailed review of accelerated carbonation curing has been conducted with focus on available knowledge, performance of resultant products, and application of ACC to supplementary cementitious materials (SCMs). This chapter has been concluded with challenges faced by ACC along with future prospects of research.

6.2

Accelerated carbonation curing of cement compounds

ACC is a process of curing for precast concrete components. In this process, after a few hours of casting, concrete is subjected to high concentration of CO2 for a fixed duration in an enclosed chamber. ACC has the potential to be used as an alternative to steam curing in the field of precast concrete. While the earlier studies for both steam curing

CO2 sequestration on cement

111

and ACC date back to the 1970s, the latter did not gain attention due to high costs of CO2 capture at that time (Berger, 1979; Berger et al., 1972; Berger and Klemm, 1972; Bukowski and Berger, 1979; Goodbrake et al., 1979a, 1979b; Klemm and Berger, 1972b; Young et al., 1974). Although the process of steam curing was an energy-extensive process and required proper heating and cooling down temperatures, abundant availability of water and already developed heating techniques made steam curing more beneficial for precast concrete. However, the past few decades saw emergence of vast technological advancement in the field of CO2 capture to tackle the rising CO2 emissions. The newer methods of CO2 capture were economical and feasible to implement. With the large-scale availability of captured CO2, researchers once again tried to explore the potential of construction materials to sequester CO2 in stable form. It has been estimated in a study that if all concrete masonry units (CMUs) in the United States and Canada are produced with ACC, 1.5 million tons of recovered CO2 can be sequestered annually (El-Hassan et al., 2014). ACC offers some advantages as compared with steam curing. Steam curing is a complex process with different stages such as steam generation stage, maintaining temperature, pressurized application of steam, and cooling stage. General energy requirement of steam curing was found to be 2300 KJ to cure one standard concrete block. ACC required only 500 KJ of energy to cure same concrete block, which is one-fifth of the energy required by steam curing (Shi et al., 2012c). It indicates that ACC serves the dual advantage of reducing the level of atmospheric CO2 and also providing a low energy alternative to steam curing. The reaction of concrete with atmospheric carbon dioxide is well established and extensively researched. It is called weathering carbonation or passive carbonation or carbonation of mature concrete. The reaction mechanism of weathering carbonation is different from ACC. Unlike weathering carbonation, in ACC, concrete is subjected to carbonation just after a few hours of mixing and in-mold curing. This difference in time of application of carbonation to concrete is the reason for difference in weathering carbonation and ACC. While the former is considered to be detrimental to the properties of concrete, the latter is developed as a curing strategy to improve the properties of building materials. In weathering carbonation, atmospheric CO2 reacts with hydrated cement products, and this process was a slow process that took place over several years. In this process, carbon dioxide present in the atmosphere reacts with major hydration products of cement, namely Ca(OH)2 and CSH. Reaction of CO2 with Ca(OH)2 leads to drop in pH of concrete, and decalcification of CSH gel deteriorates the strength of concrete. In ACC, CO2 is intentionally introduced to concrete its early ages of curing, so that CO2 can react with unhydrated cement phases, as well as hydration products, leading to formation of a dense microstructure of CSH intermingled with CaCO3. Detailed reaction mechanism of ACC has been explained further.

6.2.1

Reaction mechanism of accelerated carbonation curing

In ACC, partially hydrated cement is subjected to carbonation. Therefore, CO2 reacts not only with hydration reaction products but also with anhydrous products of cement clinker. Table 6.1 gives a brief about various reactants and corresponding reaction products obtained after reaction with CO2. The detailed mechanism of reaction with both anhydrous cement constituents and early hydration products is discussed in the following.

112

Start-Up Creation

Table 6.1 Reaction products obtained after accelerated carbonation curing. Reactivity to CO2

Reaction products

Tricalcium silicate (C3S)

High

CSH gel and CaCO3

Dicalcium silicate (C2S)

High

CSH gel and CaCO3

Tricalcium aluminate (C3A)

Low

Aluminium hydroxide and CaCO3

Tetracalcium aluminoferrate (C4AF)

Very low

n/a

Calcium hydroxide (Ca(OH)2)

High

CaCO3 and H2O

Calcium silicate hydrate (CSH)

High

SiO2, CaCO3, and H2O

Constituent

Anhydrous products

Hydration products

6.2.1.1

Carbonation of anhydrous cement constituents

The major constituents of anhydrous cement are tricalcium silicate (C3S) and dicalcium silicate (C2S), tricalcium aluminate (C3A), and tetracalcium aluminoferrate (C4AF). C3S and C2S are known to be reactive to CO2 in aqueous conditions, but C3A and C4AF show minimal to no reactivity (Fernandez-Carrasco et al., 2008; Hargis et al., 2017). The reactions of C3S and C2S with CO2 have been shown in Eqs. (6.1), (6.2) respectively. 3ð3CaO$SiO2 Þ þ ð3  xÞCO2 þ yH2 O / xCaO$SiO2 $yH2 Oþ ð3  xÞCaCO3 Tricalcium Silicate

Carbon dioxide

Water

Calcium silicate Hydrate

Calcium carbonate (6.1)

2ð3CaO$SiO2 Þ þ ð2  xÞCO2 þ yH2 O / xCaO$SiO2 $yH2 O þ ð2  xÞCaCO3 Dicalcium Silicate

Carbon dioxide

Water

Calcium silicate Hydrate

Calcium carbonate (6.2)

C3A does not show much reactivity with CO2. However, it hydrates very rapidly to form ettringite in the presence of gypsum (Neville and Brooks, 2010). Ettringite shows reactivity with CO2 to form aluminum oxide, gypsum, and CaCO3 as shown in Eq. (6.3) (Grounds et al., 1988; Nishikawa et al., 1992).

CO2 sequestration on cement

113

3CaO$Al2 O3 $3CaSO4 $32H2 O þ 3CO2 / 3CaCO3 þ 3CaSO4 $H2 O þ Al2 O3 Calcium sulfoaluminate

Carbon

Calcium

Gypsum

Aluminium

dioxide Carbonate

Oxide (6.3)

The reaction of calcium silicates with CO2 during ACC produces calcium silicate hydrate and calcium carbonate as shown in chemical Eqs. (6.1), (6.2) (Berger, 1979; Goto et al., 1995; Klemm and Berger, 1972a). The sequestration of CO2 by cement is achieved through formation of CaCO3 by carbonation curing, which gets precipitated in the pores of material in stable form (Qian et al., 2016). The resulting binding phase after carbonation curing is obtained in the form of CaCO3 intermingled in an enveloped CSH matrix (Rostami et al., 2012b). CaCO3 is obtained in different polymorphs such as calcite, vaterite, and aragonite, but most dominant polymorph formed upon carbonation of calcium silicates was found to be calcite (Ashraf and Olek, 2016; Chang et al., 2016; Goto et al., 1995; Young et al., 1974). The morphology of CSH obtained from carbonation is different from CSH obtained by hydration reactions (Chang et al., 2016; Young et al., 1974). Many studies suggest a lower CaO/SiO2 in CSH generated from carbonation as compared with CSH produced by hydration of calcium silicates (Berger et al., 1972; Goto et al., 1995; Shtepenko et al., 2006). The structure of CSH gel obtained from ACC depends on extent to which carbonation reaction was allowed to proceed and related CO2 uptake by concrete (Rostami et al., 2012b).

6.2.1.2

Carbonation of hydrated cement compounds

Calcium hydroxide and calcium silicate hydrate gel are major products formed during hydration of cement. The reaction mechanism of these products with CO2 has been presented by Eqs. (6.4) and (6.5) (El-Hassan et al., 2013). CaðOHÞ2

þ

Calcium Hydroxide

CSH Calcium Silicate hydrate

/

CO2

CaCO3

þ

H2 O

Carbon Dioxide

Calcium Carbonate

Water

þ

/

þ

CO2 Carbon Dioxide

CaCO3 Calcium Carbonate

SiO2 Silica gel

(6.4)

þ

H2 O Water

(6.5) Both the reactions indicate that the common product formed upon carbonation of hydrated cement products is CaCO3, which is precipitated in pores of the mix, thus providing a densification effect in the microstructure and hence enhanced performance of concrete (Fang and Chang, 2017; Mo et al., 2016a).

114

Start-Up Creation

Both reactions (6.4) and (6.5) are similar to the reactions observed during natural carbonation of concrete and are considered detrimental when continued over several years. Carbonation reaction of hydration products releases the bound water of concrete owing to its exothermic nature (Song and Kwon, 2007; Zhan et al., 2016). Reaction of Ca(OH)2 with CO2 causes a drop in pH of pore structure and makes reinforcement steel vulnerable to corrosion. CSH gel decalcifies into silica gel upon reacting with CO2, deteriorating the performance of concrete. However, shorter durations of ACC do not allow complete decalcification of CSH, thereby minimizing the decomposing of CSH gel(Rostami et al., 2012b).

6.2.2

Steps involved in accelerated carbonation curing

As already mentioned, ACC is the process of passing CO2 gas over precast concrete just after a few hours of mixing. The process of carbonation in ACC is preceded and succeeded by proper preconditioning and postconditioning of concrete respectively. The following section discusses these steps in detail. The carbonation curing can be divided into a four-step process, as outlined in Fig. 6.1. The duration of each step is variable in different studies. Table 6.2 gives a brief summary of durations for these steps adopted by various researchers in their study on carbonation curing.

6.2.2.1

In-mould curing

In the initial studies, ACC was applied to dry mix concrete, which did not require any in-mold curing and could be subjected to curing right after casting (Klemm and Berger, 1972b). The dry mix of concrete was further adopted for studying CMUs and concrete blocks subjected to ACC (El-Hassan and Shao, 2015; Zhan et al., 2016). However, CO2 uptake was found to be very low for pressure-compacted dry mixes (Shao and Shi, 2006). Later, when this procedure was applied to wet mix concrete, it was necessary to provide initial in-mold curing to allow early setting of concrete before demolding (Zhang and Shao, 2016a).

6.2.2.2

Preconditioning phase

This phase is essentially a water removal phase. It is necessary to maintain an optimal amount of water for effective carbonation (Fang and Chang, 2017; Rostami et al., 2011; Shao and Shi, 2006; Shi et al., 2012a). Shao and Shi in their study found that CO2 uptake is affected by moisture condition of concrete. If a wet specimen is subjected to carbonation, the reaction between cement minerals and CO2 is found to be limited, and CO2 consumption was less (Shao and Shi, 2006). The presence of Casting of concrete/ inmould curing

Preconditioning

Carbonation

Postconditioning

Figure 6.1 Typical flowchart for steps involved in accelerated carbonation curing.

CO2 sequestration on cement

115

Table 6.2 Details of duration of steps used in different studies.

Reference

Inmold curing

Preconditioning

Carbonation

Postconditioning

Investigations on concrete Zhang and Shao (2016a)

5h

5h

12 h

27 days

El-Hassan and Shao (2015)

18 h

n/a

4h

Till surface saturation

Rostami et al. (2012a)

18 h

n/a

2h

Till surface saturation

Ahmad et al. (2017)

18 h

n/a

1 he10 h

n/a

Rostami et al. (2011)

18 h

n/a

2 h, 4 h

Water curing, sealed air curing till 28 days

Shi et al. (2012a)

n/a

2e18 h

2h

n/a

Shi et al. (2012c)

6h

4h

2h

n/a

2e6 h

3h

0, 7, 28, 90 days

He et al. (2016) Zhan et al. (2013a)

n/a

n/a

3, 12, 24 h

n/a

Zhang and Shao (2016b)

5e6 h

5.5 h

12 h

27 days

Zhang and Shao (2018)

5e6 h

5.5 h

12 h

27 days

Investigations on cement paste and mortar Jang and Lee (2016)

20 h

n/a

28 days

n/a

Junior et al. (2015)

6h

n/a

1 h, 24 h

Ambient curing at RH 100%

Rostami et al. (2012b)

n/a

18 h

2h

Water spray and sealed bag curing

Sharma and Goyal (2018)

12 h

6h

12 h

Water spray for 3 days

n/a, data not available; RH, relative humidity.

116

Start-Up Creation

pore water in concrete blocks the path of CO2, thereby hindering the process of carbonation (Shi et al., 2012a; Zhang and Shao, 2016a). Therefore, it is necessary to expose the specimens to drying conditions so that easy passage to CO2 can be provided. Although, too much drying can cause removal of all the pore water from concrete, which would also affect the necessary aqueous condition required for carbonation reaction. As per a study on CMUs, removal of 50% free water promoted maximum CO2 uptake (El-Hassan et al., 2014). It is due to the time interval taken by in-mold curing and preconditioning in ACC that CO2 is able to react with anhydrous cement constituents as well as early hydration reaction products(Zhang et al., 2017). Several studies have incorporated different durations and methods for preconditioning of concrete as listed in Table 6.3. The process of precuring is started right after demolding and continued till carbonation phase. Demolding is necessary for efficient preconditioning to ensure water removal from all the faces of concrete and further facilitate maximum penetration of CO2.

6.2.2.3

Carbonation phase

After the initial precuring, the specimens are placed in the enclosed vacuum chamber. Gaseous CO2 from the industrial source is allowed to pass through the chamber after an initial vacuum. The vacuuming of chamber is necessary to allow maximum space to be occupied by CO2 gas only (El-Hassan et al., 2013; Sharma and Goyal, 2018). The

Table 6.3 Different preconditioning procedures adopted in literature. Reference

Preconditioning type

Duration

w/c ratio

Investigations on concrete Zhang and Shao (2016a)

25 C, 50  5% RH, wind speed 1 m/s

5e6 h

0.3e0.4

Shi et al. (2012a)

RH 50  5%, 98%, 22  3 C

0e18 h

0.43e0.5

Shi et al. (2012c)

Dry windy environment

4h

n/a

22 C

He et al. (2016)

RH 60%,

2e6 h

0.25,0.18,0.11

Zhang and Shao (2016b)

25 C,

RH 50  5%, fan drying at 1 m/s

5.5 h

0.4e0.5

Zhang and Shao (2018)

25 C, RH 50  5%, fan drying at 1 m/s

5.5 h

0.4

Investigations on cement pastes and mortars Rostami et al. (2012b)

25 C, RH 60%

18 h

0.36

Sharma and Goyal (2018)

26 C, RH 50  5%

6h

0.5

RH, relative humidity.

CO2 sequestration on cement

117

carbonation phase is carried out for a few hours. Table 6.4 gives the details of different parameters adopted by researchers while studying ACC. Concentration and pressure of CO2, relative humidity (RH), and temperature are important governing factors in determining the extent of carbonation reaction (Kashef-Haghighi et al., 2015; Kashef-Haghighi and Ghoshal, 2010; Shi et al., 2012b). The concentration of CO2 may vary depending on process and source of capturing. Captured CO2 may be either 100% pure or flue gas obtained from industries with concentration of 15%e25%. CO2 gas is applied at a pressure of 1e5 atm after initially attaining vacuum through a vacuum pump. Most of the studies on ACC have been conducted at room temperature or a temperature range of 20e25 C (Abdullahi et al., 2016; García-Gonzalez et al., 2008; Jang and Lee, 2016). During carbonation curing, temperature of specimens rise to 70 C for cement paste and 58 C for concrete has been observed due to the exothermic nature of carbonation reactions (Monkman and Shao, 2006; Shi et al., 2012b). CO2 diffusion is promoted under ambient relative humidity, but higher RH can be used to prevent water loss due to elevated temperatures (Bukowski and Berger, 1979; Jang and Lee, 2016; Zhang et al., 2017). Hence, it is necessary to employ a suitable combination of temperature, RH, and w/c ratio of the mix for efficient carbonation.

6.2.2.4

Postconditioning phase

The exothermic behavior of carbonation reaction causes evaporation of water required for hydration. Therefore, the postcarbonation phase is essential to replenish the lost water to enable further hydration of residual cement constituents after carbonation phase. Various studies have stressed on the role of postcarbonation water curing in promoting further hydration (El-Hassan and Shao, 2015; He et al., 2016; Rostami et al., 2011; Sharma and Goyal, 2018). It has been unanimously concluded in the literature that water curing postcarbonation helps in maximizing the strength and caused densification of microstructure (He et al., 2016; Klemm and Berger, 1972a; Monkman et al., 2016; Rostami et al., 2011; Sharma and Goyal, 2018; Shi and Wu, 2008). Hydration of cement postcarbonation helps in production of additional CSH gel that provides the additional strength and densification to carbonation cured mix. Table 6.5 gives the details of postconditioning procedure adopted by various studies. The duration of postconditioning varies from 3 to 27 days depending upon the type of postconditioning used. A lot of studies have adopted water spray instead of immersion or ponding as a postconditioning procedure (El-Hassan and Shao, 2015; Rostami et al., 2012a,b; Sharma and Goyal, 2018). Effect of ACC on pore water in concrete is more dominant near the surface (Junior et al., 2015). Therefore, use of water spray might be considered sufficient to replenish water depleted from the surface during ACC.

6.2.3

Laboratory setup of carbonation curing chamber

Accelerated carbonation curing chamber consists of an enclosed pressure vessel. The shape of chamber can be cylindrical or cubical as required (Ahmad, 2018; Sharma and

Relative humidity (%)

Duration (hours)

Vacuum condition

e

5 min

e

e

e

12

e

0.1 MPa

Room temperature

e

4

0.7 bars (0.07 MPa)

99.5

1.5 bar (0.15 MPa)

e

e

2

e

Ahmad et al. (2017)

e

10e60 psi (0.068 e0.41 MPa)

e

e

1e10

One minute

Rostami et al. (2011)

99.5

1.5 bar (0.15 MPa)

e

e

2

e

Shi et al. (2012a)

e

10, 20 psi (0.068e0.137 MPa)

e

e

2

600 mm of Hg (0.07 MPa)

2

600 mm of Hg (0.07 MPa)

Purity of CO2

Pressure

Klemm and Berger (1972b)

100

56 psi (0.38 MPa)

Zhang and Shao (2016a)

99.8

5 bars (0.5 MPa)

El-Hassan and Shao (2015)

99

Rostami et al. (2012a)

Reference

Shi et al. (2012c)

Temperature (C)

118

Table 6.4 Details of carbonation curing regime adopted in different studies.

10 psi (0.068 MPa) e

0.2 MPa

e

e

3

0.1 MPa

Zhan et al. (2013a)

e

0.1 bar (0.01 MPa)

23

e

6, 12, 24

0.5 bar (0.05 MPa)

Zhang and Shao (2016b)

99.8

5 bar (0.5 MPa)

e

e

12

e

Start-Up Creation

He et al. (2016)

99.8

5 bar (0.5 MPa)

e

e

12

e

Jang and Lee (2016)

5

e

20

60

28 days

Junior et al. (2015)

20

e

25

60

1, 24

e

Rostami et al. (2012b)

99.5

0.15 MPa

e

e

2

e

Sharma and Goyal (2018)

99

10 psi (0.068 MPa)

e

e

12

e

CO2 sequestration on cement

Zhang and Shao (2018)

119

120

Start-Up Creation

Table 6.5 Postconditioning procedures adopted in different studies. Duration of postconditioning

Reference

Postconditioning type

Zhang and Shao (2016a)

Moisture room maintained at 25 C, 95% RH

27 days

El-Hassan and Shao (2015)

Water spray

Till surface saturation

Rostami et al. (2012a)

Water spray

e

He et al. (2016)

Immersion in Ca(OH)2 saturated solution

7, 28, 90 days

Zhang and Shao (2018)

Moisture room (25 C, 95% RH)

27 days

Junior et al. (2015)

Ambient conditions, 100% RH

28 days

Rostami et al. (2012b)

Water spray

e

Sharma and Goyal (2018)

Water spray

3 days

RH, relative humidity.

Goyal, 2018; Shi et al., 2012c). The chamber is connected to a vacuum pump that removes the excess air from inside prior to carbonation. CO2 gas is supplied externally through an industrial CO2 cylinder and gas pipes. The pressure of CO2 injection is controlled by pressure regulators on the cylinder. The pressure inside the chamber is controlled by pressure gauges connected to the chamber. The chamber is also provided with input and output nozzles to control the carbon dioxide injection and removal, respectively. Safety valve is provided to immediately reduce the pressure inside the chamber in case of any fault in pressure regulation. The bottom of carbonation chamber is lined with silica gel or water-absorbing sheets to absorb water released during carbonation. Fig. 6.2 and 6.3 show setup of typical carbonation chamber and a prototype chamber, respectively.

6.3

Factors affecting CO2 sequestration by accelerated carbonation curing

Carbonation curing of concrete serves dual purpose. First is sequestration of CO2 that is measured by CO2 uptake of concrete during ACC. Second is the improvement in properties of resulting building materials. The quantification of CO2 uptake is done either by mass loss method or by thermogravimetric analysis. First method is measuring the weights of specimens before and after carbonation curing. This method is simple and easy to implement. After noting down the weights

CO2 sequestration on cement

121

Heater

CO2 cylinder

Pressure gauge

Motor

Safety valve

Silica gel

Vaccum chamber

Figure 6.2 Typical setup of carbonation curing chamber.

of specimens before and after carbonation curing, the CO2 uptake is calculated using Eq. (6.6): CO2 uptakeð%Þ ¼

Masspost CO2 þ Masslost water þ Masspre CO2 Massbinder

(6.6)

The major shortcoming of this method for calculation of CO2 uptake is the measurement of lost water during carbonation reaction. While approximate estimate can be made for amount of water lost during carbonation reaction, it is hard to know the exact amount of water lost from each specimen. The second method for determination of CO2 uptake by specimens is using thermogravimetric analysis on the carbonated specimens. This method has been more commonly used by researchers in recent studies. In this method, the carbonation cured specimen is heated over a temperature range of 50e1000 C, and the corresponding weight loss at each temperature is noted. Thereafter, the quantification of CO2 uptake is done as per Equation (6.7): CO2 uptakeð%Þ ¼

Sample mass at 550 C  Sample mass at 1000 C  100 cement mass ˛ the original sample (6.7)

The factors affecting CO2 uptake by ACC can be classified in two ways: (i) Factors related to ACC procedure such as duration and pressure of the supplied CO2 gas, concentration of CO2 gas, preconditioning, relative humidity, and temperature

122

Start-Up Creation

Figure 6.3 Prototype of carbonation curing chamber.

(ii) Factors related to characteristics of sequestering material such as cement/binder composition, water to binder ratio, and moisture condition

Effect of these factors on CO2 uptake by ACC as reported in different studies has been summarized in Table 6.6 and discussed in detail in the following section.

6.3.1

Effect of CO2 concentration, duration, and pressure of CO2 exposure

The influence of different parameters of ACC on the degree of CO2 uptake by concrete has been evaluated by measuring the CO2 uptake after carbonation. Ahmad et al. (2017) studied the effect of both duration of CO2 exposure and pressure of CO2 injection on CO2 uptake ability of concrete. The uptake of CO2 increased as the time of CO2 exposure of specimens was increased from 1 to 10 h. However, the rate of CO2 uptake diminished with the increase in time. Precipitation of calcium carbonate in pores after initial carbonation reaction hinders the penetration of CO2 at longer curing durations (Ahmad et al., 2017). It was also noted that the diminishing rate of CO2 uptake prevailed only at low pressures of 10e40 psi. Higher pressure of 50 and 60 psi exhibited over 50% and 100% more CO2 uptake as compared with low pressures. Zhan et al. also observed an increase in CO2 uptake from 19% to 30% on increasing the curing time from 6 to 24 h (Zhan et al., 2013a). From Table 6.6, a direct correlation can be understood between duration of CO2 exposure, pressure of injection, and the resulting CO2 uptake. Low pressure of CO2 injection can also yield sufficient CO2 uptake when coupled with longer curing durations. Studies on carbonation curing have been conducted using 100% CO2 concentration (pure CO2) as well as using flue gas obtained from cement and power plants with CO2 concentration ranging from 15% to 25% (Monkman and Shao, 2010a; Shao et al., 2006a,b; Shao and El-Hassan, 2013; Wang et al., 2007; Zhan et al., 2013a). To study

Table 6.6 CO2 uptake data for different parameters of accelerated carbonation curing. Material characteristics Water/ binder ratio

Duration of CO2 exposure

Preconditioning

CO2 pressure

Concentration of CO2

CO2 uptake (% of weight of binder)

5 bar (0.5 MPa)

99.8%

9.9%e14.6%

OPC

0.3e0.4

5e6 h

El-Hassan and Shao (2015)

Portland limestone cement

0.71

4h

e

0.1 MPa

99%

18.3%

Rostami et al. (2012a)

ASTM type 1 cement

0.36

2h

e

1.5 bar (0.15 MPa)

99.5%

7%e9%

Ahmad et al. (2017)

ASTM type 1 cement

0.45

1e10 h

e

10e60 psi (0.068e0.41 MPa)

e

3%e7%

Shi et al. (2012a)

ASTM type III Portland cement

0.43e0.50

2h

RH 50  5%, 98%, 22  3 C

10, 20 psi (0.068 e0.137 MPa)

e

10%e24%

Zhan et al. (2013a)

ASTM type 1 cement

e

6, 12, 24 h

e

0.1 bar (0.01 MPa)

e

19%e30%

Zhang and Shao (2016b)

OPC and fly ash

e

12 h

e

5 bar (0.5 MPa)

99.8%

14.3% and 17.06%

Jang and Lee (2016)

Belite-rich Portland cement

0.5

28 days

e

e

5%

13%e16.9%

OPC, original Portland cement; RH, relative humidity.

50  5% RH, wind speed 1 m/s

123

Zhang and Shao (2016a)

25 C,

CO2 sequestration on cement

Reference

Binder material

Parameters related to carbonation curing

124

Start-Up Creation

the effect of concentration of CO2 gas on CO2 uptake, Shao et al. carried out ACC for duration of 2 h using 99.8% and 25% concentration of CO2. CO2 uptake by concrete was found to be directly proportional to the concentration of CO2 used. When the carbonation curing is carried out at 100% concentration level of CO2, the specimen recorded 16% CO2 uptake by weight of binder, whereas the CO2 uptake level was reduced to 9% for carbonation curing carried out at 25% concentration level (Shao et al., 2006b). Jang and Lee (2016) used 5% concentration of CO2 and carried out the ACC process for 28 days to achieve a CO2 uptake of 16%. While technologies are available to extract 100% pure CO2 from the flue gases, the economical constraints of these techniques also need to be considered to make the process of CO2 sequestration efficient.

6.3.2

Effect of preconditioning on CO2 uptake by accelerated carbonation curing

As discussed in Section 6.2.2, preconditioning prior to carbonation is necessary to remove excess water from pores so as to provide a clear path to CO2. Many studies have emphasized on the role of preconditioning for effective CO2 sequestration (Shao and Shi, 2006; Shi et al., 2012a). Shi et al. (2012a). studied the effect of different ways of preconditioning during the ACC process on CO2 uptake by concrete. Preconditioning was done in two ways: dry and moist conditions with RH 50% and 98%, respectively up to 18 h. Dry preconditioning showed slightly higher CO2 consumption as compared with moist environment. CO2 consumption was found to be decreasing beyond the preconditioning time of 5 h, indicating existence of an optimum moisture content to be achieved for effective CO2 sequestration.

6.3.3

Effect of material characteristics on CO2 uptake by accelerated carbonation curing

CO2 uptake by any cementitious material directly depends on the composition of material. Calcium silicates are major reactants during accelerated carbonation curing. A higher belite (C2S) content was found to promote the CO2 uptake by 3% of weight of the binder (Jang and Lee, 2016). In ACC, CO2 actively reacts with metal oxides bearing materials to form carbonates. Presence of oxides of calcium and magnesium in material enhances the degree of CO2 uptake significantly (Mo et al., 2016b; Mo and Panesar, 2013, 2012; Vandeperre and Al-Tabbaa, 2007). Addition of SCMs such as fly ash, blast furnace slag, and MgO was also found to improve the CO2 uptake efficiency of the mix (Monkman and Shao, 2006; Panesar and Mo, 2013; Peethamparan et al., 2003; Zhang et al., 2016). High replacement levels of cement by supplementary materials lead to more porous microstructure and facilitate higher penetration of CO2 gas. Also, finer particle sizes of SCMs provide higher specific surface area for reaction and accelerate the rate of carbonation (Monkman and Shao, 2006). In a study by Zhang et al. (2016), it was observed that CO2 uptake increased from 19.5% to 24% and 28%, respectively, when 20% and 50% original Portland cement (OPC) was

CO2 sequestration on cement

125

replaced by fly ash. On replacing OPC with fly ash, the hydration degree of mix decreased and led to formation of a porous microstructure. The porous microstructure allows CO2 to penetrate easily in the paste and enhance the CO2 reaction degree. Therefore, for same water to binder ratio, fly ash concrete was more reactive to CO2 than OPC concrete. Water to binder ratio also has a significant impact on CO2 sequestration capability of concrete. While sufficient water is required for hydration reaction to proceed without any hindrance, too much water in the pores can block the passage for CO2. Klemm and Berger (1972b) in their study found compressive strength of cement mortars to be decreasing at very low and very high water contents. For dry mixes, low water contents of order 0.15e0.20 have been employed in earlier studies (Klemm and Berger, 1972a; Young et al., 1974). But in the case of wet mix concrete, an optimum amount of water is also necessary for effective carbonation. Water interacts with CO2 to form carbonic acid, which is responsible for dissolving calcium ions from cement minerals, and insufficient water may cause halting of reaction.

6.4

Performance of carbonation-cured building materials

Carbonation curing has been successfully applied on various precast elements to improve the resultant properties. The effect of ACC was initially demonstrated on mortar specimens and was later extended to masonry units and concrete specimens. The effect of ACC on the results properties of different materials is discussed hereunder.

6.4.1

Performance of cement paste and mortars

The study on ACC initially began with cement mortars and pastes in the early 1970s (Goodbrake et al., 1979a; Klemm and Berger, 1972b; Young et al., 1974). Klemm and Berger (1972b) studied the effect of accelerated carbonation curing on cementitious systems at different waterecement ratios. Specimens carbonated for 5 min followed by 3 days of hydration were able to achieve compressive strength equivalent to 14day strength of noncarbonated specimens. The increase in strength was attributed to formation of a matrix composed of CSH and CaCO3 upon carbonation of calcium silicates and Ca(OH)2. The strength of carbonation-cured specimens was also found to be dependent on the water content of mortar. Water content of mortars and postcuring hydration had prominent effect on compressive strength of carbonation cured mortars. It has been reported in several studies that posthydration of carbonation-cured specimens for 3 days led to approximately 45% increase in strength of mortars (He et al., 2016; Klemm and Berger, 1972b; Sharma and Goyal, 2018). Similar results for strength gain by carbonation-cured mortars were reported in other studies (Farnam et al., 2016; Jang and Lee, 2016; Panesar and Mo, 2013; Shao et al., 2014a; Sharma and Goyal, 2018).

126

Start-Up Creation

The results for porosity related properties of mortars and pastes subjected to early carbonation curing have been found to be contradictory in different studies (Junior et al., 2015; Qian et al., 2016; Sharma and Goyal, 2018). Junior et al. (2015) reported an increase in porosity of cement pastes when subjected to carbonation curing. The increase in porosity was attributed to loss of pore water from the surface and promoting formation of voids in its place. On the other hand, many studies reported a reduction in porosity of carbonation-cured mortars and pastes (Qian et al., 2016; Sharma and Goyal, 2018). The reduction in porosity was reported to be caused by formation of CaCO3 during the process of carbonation curing. CaCO3 gets precipitated in the voids and creates a microaggregate effect that reduced porosity of the mix. Microstructure of carbonation-cured mortars has been studied using X-ray diffraction (XRD), scanning electron microscopy (SEM), and thermogravimetry (TGA). X-ray diffraction patterns of carbonation-cured specimen showed proportion of Ca(OH)2 to be significantly reduced and formation of calcite as major CaCO3 phase. Also, C3S and C2S peaks were noticeably diminished, indicating partial carbonation of silicates (Khoshnazar and Shao, 2018; Rostami et al., 2012b). On further water curing of carbonated specimens, Ca(OH)2 appeared stronger with weaker calcium silicate peaks, indicating continuation of hydration reaction postcarbonation on providing sufficient water (Rostami et al., 2012b; Sharma and Goyal, 2018). SEM images of carbonated specimens showed a densified mix with strong peaks of Ca, Si, and O in energy-dispersive spectroscopy (EDS) indicating presence of CSH with relatively high carbon content. Crystalline CaCO3 was not observed clearly in the mix; instead, intermingled matrix of CSH with CaCO3 was observed (Rostami et al., 2012b; Sharma and Goyal, 2018). Figs. 6.4 and 6.5 show SEM-EDS and XRD analysis for carbonation-cured mortars from a study done by Sharma and Goyal (2018). TGA analysis of carbonated mortars confirmed the findings of XRD and SEM. The mass loss of carbonated specimens in the temperature range of 420e460 C was lower than the reference sample indicating lower Ca(OH)2 decomposition. The mass loss after 540 C was higher for carbonated specimens, which indicated loss of bonded CO2 (Rostami et al., 2012b). The effect of carbonation curing on strength of pastes was also found to be dependent on duration of CO2 exposure. Junior et al. (2015) studied the effect of two different durations of 1 and 24 h of ACC on properties of high initial strength Portland cement paste. 1 h of carbonation curing enhanced the compressive strength by almost 10%, whereas 24 h of carbonation curing considerably reduced the compressive strength as compared with the reference specimens. The increase in strength was attributed to generation of CSH along with CaCO3, which created a microstructure with strength-contributing solids, as explained in earlier studies (Ashraf and Olek, 2016; Guan et al., 2016; Rostami et al., 2012b). However, carbonation curing also led to removal of water from the pore structure. Prolonged duration of carbonation leads to excess removal of water and causes opening up of pore structure. The change in structure composition from loss of water affects the strength of paste negatively. Along with this, high water loss significantly decreased the remaining water content and hindered the subsequent hydration reactions of cement paste.

CO2 sequestration on cement

127

Spectrum 2

1 SEI

20kV

WD11mm SS33

x1,000

2

3

4

5

6

7

Full scale 1167 cts cursor: –0.009 (7758 cts)

10Pm

8

9 keV

Figure 6.4 SEM-EDS analysis of carbonation-cured mortars (Sharma and Goyal, 2018). EDS, energy-dispersive spectroscopy; SEM, scanning electron microscopy.

6.4.2

Performance of concrete masonry units

CMUs are precast products made of plain concrete. CMUs are used for construction of load-bearing walls. CMUs represent a low environmental impact construction system and provide superior performance than cast in situ concrete (El-Hassan et al., 2014). Worldwide application of CMUs provides huge scope for CO2 sequestration with the help of ACC. Several researchers examined the effect of ACC on performance of CMUs made with limestone cement and lightweight aggregate in different studies (El-Hassan et al., 2014; El-Hassan and Shao, 2015; MacMaster and Tavares, 2015;

5

1- Portlandite , 2- Calcite

5000

3- Tricalcium silicate, 4- Dicalcium silicate 5- Quartz 1

4000

5

2,3 4

3

2,3

2,3

2,3

2,3

3,4

CS

Intensity

5

3000 2,3

5

2000

1

C

5

1000 1

5

2,3

4

0 10

20

30

40

50

W 60

2θ Figure 6.5 X-ray diffraction spectrums for water-cured and carbonation-cured mortars (Sharma and Goyal, 2018).

128

Start-Up Creation

Mahoutian and Shao, 2016; Shao et al., 2014b; Xuan et al., 2016). In the earlier studies by El-Hassan and Shao, CMUs were carbonation cured for 4 h followed by water spray till surface saturation. The results were compared with 4-h steam curing and water curing (El-Hassan et al., 2014; El-Hassan and Shao, 2015). Steam curing had the highest early age strength followed by carbonation curing and water curing. Carbonation curing had higher compressive strength than water cured specimens at all testing ages. The microstructure studies on carbonation-cured CMUs revealed similar observations as found in microstructure testing of cement pastes and mortars (El-Hassan and Shao, 2015). XRD and TGA confirmed substantial conversion of Ca(OH)2 into CaCO3. SEM images of CMUs showed microstructure composed of CSH, ettringite, Ca(OH)2 along with poorly crystalline CaCO3, wrapped between CSH. CMUs were able to uptake approximately 24% CO2 by weight of cement. It was estimated in the study that one CMU block of 15 kg with 13% cement was able to store 0.47 kg of cement in the form of CaCO3. These data were extrapolated to estimate that if block and brick plants incorporated ACC, CO2 emissions related to cement industry could be reduced by 2.5%.

6.4.3

Performance of concrete

Most of the work on ACC has been concentrated on studying the performance of plain concrete. It has been unanimously concluded in the literature that rapid early strength gain is eminent after ACC (El-Hassan and Shao, 2014; He et al., 2016; Monkman and Shao, 2010b; Rostami et al., 2012a; Shao et al., 2006a; Shi et al., 2012a,c; Zhan et al., 2013a; Zhang and Shao, 2016a,b, 2018). The increase in compressive strength of ACC-cured mixes can be understood due to formation of calcium silicate hydrate gel intermingled with CaCO3, which generates a more dense microstructure as compared with conventional hydration where major reaction products are Ca(OH)2 and CSH (Shao et al., 2006b; Shao and El-Hassan, 2013; Zhang and Shao, 2016a). CaCO3 produces a higher solid volume than Ca(OH)2 and does not leach out easily (Dias, 2000). It has been concluded in the studies that later age strength of carbonation-cured concrete is dependent upon postcuring process adopted (El-Hassan et al., 2013; He et al., 2016; Rostami et al., 2012a). Considerable strength gain has been reported when ACC is followed by subsequent water curing either by immersion in water or by water spray (El-Hassan and Shao, 2015; He et al., 2016). Postcarbonation water spray is necessary to replenish the lost water and allow further hydration of residual cement constituents (Rostami et al., 2011). Many studies have stressed on role of various factors such as duration of CO2 exposure and pressure on the performance of carbonation-cured concrete (Ahmad et al., 2017; Zhan et al., 2013b). While shorter carbonation durations have helped in enhancing the performance of cement paste, higher duration of initial carbonation curing showed a detrimental effect on performance of concrete. Higher duration of carbonation leads to lesser availability of water for further hydration of cement causing a decrease in strength of concrete (Rostami et al., 2012a). The densification of microstructure by carbonation curing is found to enhance the durability performance of concrete. The durability of concrete has been evaluated by

CO2 sequestration on cement

129

testing chloride permeability, air permeability, electrical resistivity, sulfate attack, and acid attack (Rostami et al., 2012a, 2011; Zhang and Shao, 2016a). Rostami et al. (2012a) compared the effects of steam curing and carbonation curing on durability performance of precast concrete. Carbonation-cured concrete showed higher surface resistivity and increased resistance to sulfate and chloride attack. The precipitation of CaCO3 in the surface pores results in a denser and less connected pore structure in precast concrete. Pore size refinement, lesser passage to water, and other deleterious substances and subtraction of reactive Ca(OH)2 from concrete through carbonation curing adds to durability performance of concrete (Zhang and Shao, 2016a). Shi et al. (2012c) studied the weathering properties of carbonation-cured concrete blocks. Carbonationcured specimens showed lower drying shrinkage and water absorption as compared with steam-cured specimens. The better durability performance was attributed to reduction in total porosity, especially capillary porosities, due to formation of CSH intermingled with CaCO3. Similar results for chloride penetration and weathering carbonation resistance of carbonation-cured concrete were reported by Zhang and Shao (2016b). Densification of the mix by carbonation curing has been unanimously accepted as per microstructural assessments in various studies (Ahmad et al., 2017; He et al., 2016; Rostami et al., 2012a; Zhang and Shao, 2016a). As discussed earlier, the densification is a result of different reaction products formed by carbonation curing as compared with water or steam curing. SEM images of carbonation-cured concrete exhibited dense microstructure composed of CaCO3 crystal wrapped in CSH gel (Ahmad et al., 2017; He et al., 2016). The formation of different phases of CaCO3 was confirmed by XRD analysis. Based on the participating reactants, vaterite or calcite polymorphs were observed in XRD spectrums (Zhang and Shao, 2016a). The microstructure of carbonation-cured concrete was significantly enhanced when sufficient postconditioning was provided to the specimens. Presence of water enabled further hydration of concrete post-ACC, and SEM images showed formation of additional CSH gel and Ca(OH)2 (He et al., 2016). The only concern regarding use of ACC is reported for reinforced concrete structural elements. Natural carbonation of concrete has been extensively studied, and several researchers have stressed on reinforcement corrosion due to prolonged exposure to carbonation (Ahmad, 2003; Belda Revert et al., 2018; Bertolini et al., 2013; B€ ohni, 2005; Cabrera, 1996; Hobbs, 2001; Ismail et al., 2010; K€oli€o et al., 2015; Roy et al., 1999; Tonoli et al., 2011; Zhao and Jin, 2016). It is known that Ca(OH)2 is converted into CaCO3 during natural carbonation, and this lowers the pH from 12.5 to 9, thereby damaging the passive layer that protects reinforcement bar (Zhao and Jin, 2016). Similar to this, some researchers have raised concern over lowering of pH by ACC (Rostami et al., 2011; Shi et al., 2012c; Zhang and Shao, 2016b). However, many studies on pH of carbonation-cured mortar concrete have shown the pH of carbonated products to be higher than the threshold value of 10 (Rostami et al., 2011; Zhang and Shao, 2016b). Also, it has been found feasible to raise the decreased pH by following carbonation curing process with adequate water curing process (Rostami et al., 2012a; Sharma and Goyal, 2018).

130

6.5

Start-Up Creation

Use of supplementary cementitious materials for CO2 footprint reduction and sequestration

Cement production is one of the largest contributors to CO2 emissions. SCMs have been partially or completely used as replacement of cement or fine aggregates in construction to reduce the demand of cement and corresponding CO2 emissions (Al-Harthy et al., 2003; Babu and Kumar, 2000; Bondar and Coakley, 2014; Cheng et al., 2005; Jia, 2012; Khan and Siddique, 2011; Kunal et al., 2012; Limbachiya and Roberts, 2004; Lothenbach et al., 2011; Maslehuddin et al., 2009; Najim et al., 2014; Nochaiya et al., 2010; Siddique, 2011; Siddique and Bennacer, 2012; Toutanji et al., 2004). Some of the established SCMs are fly ash, silica fume, blast furnace slag, steel slag, etc. Pozzolanic materials, such as fly ash, steel slag, and cement kiln dust (CKD) when used as replacement to cement, improve the long-term performance of concrete as the pozzolanic reaction takes time. But, the early age strength of SCMs is a concern, as the reduction in cement content causes lesser hydration and, consequently, lesser formation of CSH gel (Lothenbach et al., 2011). The problem of low early strength of SCMs can be solved by using carbonation curing at early ages. Apart from CO2 sequestration, carbonation curing has also been found to act as an activation mechanism for SCMs (Monkman et al., 2018). Many studies have tried to assess the effect of ACC on use of SCMs (Monkman and Shao, 2006; Sharma and Goyal, 2018; Zhan et al., 2016; Zhang et al., 2016; Zhang and Shao, 2018). ACC not only enhances the hydration degree of alternative cementitious materials but also improves the early age performance of concrete. Monkman and Shao (2006) assessed the carbonation behavior of blast furnace slag, fly ash, electric arc furnace (EAF) slag, and lime. All four materials reacted differently when subjected to carbonation curing of 2 h. Fly ash and lime showed highest degrees of carbonation, followed by EAF slag, whereas ground granulated blast slag (GGBS) showed least reactivity towards CO2. Calcite was the major reaction product from fly ash, lime, and EAF slag, whereas aragonite was produced by carbonation of GGBS. Sharma and Goyal (2018) studied the effect of ACC on cement mortars made with CKD as cement replacement. ACC was found to improve the early age strength of cement mortars by 20%, even for mortars with higher CKD content. Several studies tried to assess the CO2 sequestration ability of steel slag binders (Bonenfant et al., 2008; He et al., 2013; Huijgen et al., 2005; Huijgen and Comans, 2006; Ukwattage et al., 2017). Presence of C2S component in steel slag makes it a potential cementitious material that could act as a carbon sink for CO2 sequestration (Johnson et al., 2003). Zhang et al. (2016) in their study found that fly ash concrete was more reactive to CO2 as compared with OPC concrete. With the reduction in OPC content, a porous microstructure was generated due to insufficient hydration reaction. The enlarged distance between cement grains facilitated higher possibility of reaction with CO2, and hence, a higher degree of CO2 sequestration. The performance of SCMs subjected to carbonation curing is majorly dependent upon fineness of material and water content postcarbonation. Finer particle size of SCMs provides a higher specific area for effective carbonation reaction. Due to this, it was observed in many studies that concrete

CO2 sequestration on cement

131

made with SCMs had better reactivity toward CO2 than OPC (Monkman and Shao, 2006). Water content postcarbonation also plays a dominant role in determining the performance of SCMs. Sufficient water content postcarbonation is necessary for complete hydration and pozzolanic reaction of SCMs (Monkman and Shao, 2006).

6.6

Alternate binders to enhance CO2 sequestration capacity of cement

The presence of CO2 reactive minerals in cement can enhance its CO2 sequestration capacity. Incorporating such minerals in cement as partial substitutions or additives can improve the CO2 uptake of resulting concrete (Torgal et al., 2018). Magnesium oxide (MgO) has been utilized as a low-dose additive to Portland cement (Zheng et al., 1991). MgO hydrates in presence of water to form magnesium hydroxide. When subjected to carbonation curing, magnesium hydroxide (Mg(OH)2) reacts with CO2 in high RH and CO2 concentration to form magnesium carbonate or nesquehonite (MgCO3.3H2O). The fundamental reaction can be represented as shown in Equation (6.8) (De Silva et al., 2009). MgðOHÞ2

þ

CO2

Magnesium

Carbon

hydroxide

Dioxide

þ

3H2 O

/ MgCO3 $3H2 O

Water

Nesquehonite

(6.8)

Many studies have been conducted using MgO in blended cements and subjected to carbonation curing (Mo et al., 2016b; Mo and Panesar, 2013, 2012; Panesar and Mo, 2013; Pu and Unluer, 2016; Unluer, 2018; Unluer and Al-Tabbaa, 2014; Zhang and Panesar, 2018). The researchers have reported enhanced compressive strength owing to formation of matrix composed of nesquehonite, calcite, CSH, and Ca(OH)2. One of the concerns regarding use of MgO is stability of nesquehonite at high temperature and low RH (Jauffret et al., 2015). High temperature might cause disintegration of nesquehonite and alter the binder properties of MgO (Jauffret et al., 2015). Hydraulic calcium silicates C3S and C2S are major participants of both cement hydration and carbonation reactions. Wollastonite (CaO.SiO2) or CS is a nonhydraulic mineral that is found to be reactive toward CO2 (Ashraf and Olek, 2016). Reaction of CS with CO2 yields calcium carbonate, silica gel as main phases instead of CSH as is the case in hydraulic silicates (Huijgen et al., 2006). The chemical reaction of wollastonite with CO2 has been represented in Equation (6.9). CaSiO3 Wollastonite

þ

CO2

/

CaCO3

Carbon

Calcium

Dioxide

carbonate

þ

SiO2 Silica gel

(6.9)

132

Start-Up Creation

Possible carbonation of minerals such as wollastonite, which are otherwise noncementitious, opens up the opportunity for enhanced CO2 sequestration as well as potential additives to Portland cement.

6.7

Alternate techniques related to carbonation curing

Apart from using carbonation curing as a medium for CO2 sequestration, there are few other techniques available to achieve the same goal. These techniques have been partially or completely implemented to industrial production. Some of these industrial applications have been discussed hereunder. A precast concrete manufacturing technology has been developed by CarbonCure Technologies Inc. by using CO2 captured from cement factory and coal-fired power plant (Monkman and MacDonald, 2016). The technology is found to provide better resistance to efflorescence and freezing and thawing. Solidia Technologies has developed a wollastonite-based cement with the help of carbonation curing (Meyer et al., 2018). Similarly, Eco-Cement has developed an energy-saving MgO additiveebased cement by using both hydration and carbonation on little doses of MgO (Harrison, 2005). The production of MgO-based cement required lesser sintering temperature compared with OPC and enhanced the energy efficiency of cement production along with CO2 sequestration. Kajima Corp. of Japan developed an eco-friendly concrete by replacing 50% Portland cement with Ƴ-C2S and curing with carbon dioxide obtained from coal power plant (Higuchi et al., 2014). The overall process has been estimated to reduce the CO2 emissions by half.

6.8

Challenges for commercial implementation of accelerated carbonation curing

ACC has been established as an efficient CO2 sequestration technique as well as stable curing regime for precast concrete at laboratory stage. However, there are several challenges that need to be countered prior to industry application of carbonation curing. The existing studies on ACC have been limited to small sized specimens such as cubes and cylinders primarily due to size constraints in the prototype carbonation chambers. In general, ACC has shown significant improvement in the performance of specimens. However, ACC is a diffusion-based process; hence the size of precast member is expected to play a pivotal role in deciding the effectiveness of carbonation curing in large-sized specimens, and consequently, real structural elements. Carbonation curing is solely dependent on captured CO2 gas obtained from industrial sources. The cost of capturing and transportation of CO2 to ACC setup is one of the governing factors in determining the cost efficiency of CO2 sequestration by ACC. Attention needs to be focused on innovative approaches such as integrated carbon capture and sequestration units that can provide economical CO2 sequestration.

CO2 sequestration on cement

133

Limited published data are available regarding comparative cost analysis of carbonation curing with other curing regimes as well as CO2 sequestration processes. El-Hassan et al. (2014) compared the cost of 4- and 18-h carbonation curing to cost of 4-h steam curing (El-Hassan et al., 2014) and found similar costs for 4-h carbonation and steam curing. The cost for 18-h carbonation was found to be approximately four times than other two regimes. Detailed comparative cost analysis needs to be carried out to make informative expansion of ACC to industries. On the possibility of high ACC costs, massive industry realization of the process would need external incentives from government and environmental agencies. Policies such as carbon trading and capping and carbon tax would be needed to convince industries of undertaking ACC.

6.9

Areas of further investigation

Accelerated carbonation curing has been established as a beneficial alternative to steam curing for precast concrete. The process of ACC not only serves the purpose of carbon dioxide sequestration but also enhances the properties of concrete and mortar. Concrete cured with carbon dioxide had considerable increase in early age compressive strength and was able to achieve required later age strength. The precipitation of CaCO3 along with calcium silicate hydrate provided a denser microstructure as compared with hydration-cured specimens. While a lot of successful experimental studies have been conducted on ACC, there is still a wide scope of knowledge to be gained before accepting ACC in practical applications. The efficiency of ACC depends upon a number of factors including purity of CO2 gas, pressure during ACC, and duration of curing. It is necessary to optimize the process of ACC by controlling these parameters carefully, so that maximum CO2 sequestration can be achieved economically. A few studies have tried to mathematically model the amount of CO2 uptake based on different variables such as cement compounds and specific surface area. However, there is still requirement of a numerical model, which addresses effect of multiple parameters that affect the process of CO2 sequestration in cement. Carbonation reaction involves dissolution of Ca(OH)2 on reacting with carbon dioxide, which leads to a decrease in pH of concrete. The decrease in pH beyond 9 can destroy the passive layer around reinforcement bars, thereby leading to their corrosion. Many studies have examined pH of plain concrete after carbonation curing and found it to be sufficiently alkaline. Research studies have also been performed to evaluate durability aspects such as chloride penetration and weathering carbonation resistance of carbonation-cured concrete. However, reinforced specimens have not been tested in any research study to evaluate actual risk of corrosion in carbonationcured specimens. Research on corrosion resistance of reinforced specimens will help develop ACC for real-life application in precast members. In a nutshell, the field of ACC is an emerging area of study among researchers owing to the requirement for a sustainable ecosystem. However, till date, the study of effect of ACC on concrete is still limited only to small-scale plain concrete

134

Start-Up Creation

specimens. There is an immediate need to study the performance of large-scale real-life reinforced specimens exposed to ACC, since this simulates the actual field requirements of any curing technique. Furthermore, the use of supplementary additives in combination with ACC is important to reduce the demand for cement and thus lower the overall carbon footprint of the construction process. Overall, ACC provides a useful alternative to traditional water and steam-based curing methods, and hence its effect must be explored further in detail for building a sustainable future and conservation of existing natural resources.

6.10

Conclusions

This chapter discusses in detail possibility of CO2 sequestration by cement-based materials through accelerated carbonation curing. Reaction mechanisms, laboratory processes, and resulting performance of carbonation curing have been comprehensively discussed and reviewed based on available literature. CaCO3 and CSH are major reaction products obtained after carbonation curing, which contribute to enhanced compressive strength and durability of concrete and mortars. The efficiency of CO2 uptake by cement-based materials is dependent on several factors such as concentration of CO2, duration and pressure of CO2 exposure, preconditioning prior to ACC, reacting minerals, and water content. Carbonation-cured building materials had higher early strength, decreased porosity, and improved resistance to adverse environment. Application of carbonation curing on SCMs for CO2 footprint reduction and sequestration was also reviewed. Early age performance of SCMs is significantly improved along with enhanced CO2 sequestration by the mix. Application of carbonation curing as an alternative to steam curing for plain concrete and masonry has been justified at laboratory stage, but there are still a few challenges that need to be faced before industrial implementation. Applicability of ACC to large-scale specimens and reinforced specimens needs to be evaluated along with definitive cost analysis prior to industrial realization. Progressive economic policies are expected of government and environmental agencies to attract industries for large-scale implementation of ACC. Carbonation curing of cement-based products has progressed significantly since its origin in the 1970s and offers great merits, but there is still a wide scope of knowledge to be gained before accepting ACC in practical applications. Focus needs to be laid on economic and practical challenges faced by ACC to pave the way for further greenhouse gas mitigation and sustainable development.

References Abdullahi, M., Odigure, J.O., Kovo, A.S., Abdulkareem, A.S., 2016. Characterization and predictive reaction model for cement-sand-kaolin composite for CO2 sequestration. Journal of CO2 Utilization. https://doi.org/10.1016/j.jcou.2016.06.008.

CO2 sequestration on cement

135

Ahmad, S., 2018. Accelerated Carbon Dioxide Sequestration, Carbon Dioxide Sequestration in Cementitious Construction Materials. Elsevier Ltd. https://doi.org/10.1016/B978-0-08102444-7.00005-8 Ahmad, S., 2003. Reinforcement corrosion in concrete structures, its monitoring and service life prediction - a review. Cement and Concrete Composites. https://doi.org/10.1016/S09589465(02)00086-0. Ahmad, S., Assaggaf, R.A., Maslehuddin, M., Al-Amoudi, O.S.B., Adekunle, S.K., Ali, S.I., 2017. Effects of carbonation pressure and duration on strength evolution of concrete subjected to accelerated carbonation curing. Construction and Building Materials 136, 565e573. https://doi.org/10.1016/j.conbuildmat.2017.01.069. Al-Harthy, A.S., Taha, R., Al-Maamary, F., 2003. Effect of cement kiln dust (CKD) on mortar and concrete mixtures. Construction and Building Materials 17, 353e360. https://doi.org/ 10.1016/S0950-0618(02)00120-4. Andrew, R.M., 2018. Global CO2 Emissions from Cement Production, pp. 195e217. Ashraf, W., Olek, J., 2016. Carbonation behavior of hydraulic and non-hydraulic calcium silicates: potential of utilizing low-lime calcium silicates in cement-based materials. Journal of Materials Science. https://doi.org/10.1007/s10853-016-9909-4. Babu, K.G., Kumar, V.S.R., 2000. Efficiency of GGBS in concrete. Cement and Concrete Composites 30, 1031e1036. Belda Revert, A., De Weerdt, K., Hornbostel, K., Geiker, M.R., 2018. Carbonation-induced corrosion: investigation of the corrosion onset. Construction and Building Materials. https://doi.org/10.1016/j.conbuildmat.2017.12.066. Berger, R.L., 1979. Stabilization of silicate structures by carbonation. Cement and Concrete Composites. https://doi.org/10.1016/0008-8846(79)90150-9. Berger, R.L., Klemm, W.A., 1972. Accelerated curing of cementitious systems by carbon dioxide. Part II. Hydraulic calcium silicates and aluminates. Cement and Concrete Composites. https://doi.org/10.1016/0008-8846(72)90002-6. Berger, R.L., Young, J.F., Leung, K., 1972. Acceleration of hydration of calcium silicates by carbon dioxide treatment. Nature Physical Science (London). https://doi.org/10.1038/ physci240016a0. Bertolini, L., Elsener, B., Pedeferri, P., Redaelli, E., Polder, R.B., 2013. Carbonation-Induced corrosion. In: Corrosion of Steel in Concrete. https://doi.org/10.1002/9783527651696.ch5. B€ ohni, H., 2005. Corrosion in Reinforced Concrete Structures, Corrosion in Reinforced Concrete Structures. https://doi.org/10.1533/9781845690434. Bondar, D., Coakley, E., 2014. Use of gypsum and CKD to enhance early age strength of High Volume Fly Ash (HVFA) pastes. Construction and Building Materials 71, 93e108. https:// doi.org/10.1016/j.conbuildmat.2014.08.015. Bonenfant, D., Kharoune, L., Sauvé, S., Hausler, R., Niquette, P., Mimeault, M., Kharoune, M., 2008. CO2 sequestration potential of steel slags at ambient pressure and temperature. Industrial and Engineering Chemistry Research. https://doi.org/10.1021/ie701721j. Bukowski, J.M., Berger, R.L., 1979. Reactivity and strength development of CO2 activated non-hydraulic calcium silicates. Cement and Concrete Composites 9, 57e68. https:// doi.org/10.1016/0008-8846(79)90095-4. Cabrera, J.G., 1996. Deterioration of concrete due to reinforcement steel corrosion. Cement and Concrete Composites. https://doi.org/10.1016/0958-9465(95)00043-7. Chang, J., Fang, Y., Shang, X., 2016. The role of b-C2S and g-C2S in carbon capture and strength development. Materials and Structures. https://doi.org/10.1617/s11527-0160797-5.

136

Start-Up Creation

Cheng, A., Huang, R., Wu, J., Chen, C., 2005. Influence of GGBS on durability and corrosion behavior of reinforced concrete. Materials Chemistry and Physics 93, 404e411. https:// doi.org/10.1016/j.matchemphys.2005.03.043. De Silva, P., Bucea, L., Sirivivatnanon, V., 2009. Chemical, microstructural and strength development of calcium and magnesium carbonate binders. Cement and Concrete Composites. https://doi.org/10.1016/j.cemconres.2009.02.003. Dias, W.P.S., 2000. Reduction of concrete sorptivity with age through carbonation. Cement and Concrete Composites 30, 1255e1261. El-Hassan, H., Shao, Y., 2015. Early carbonation curing of concrete masonry units with Portland limestone cement. Cement and Concrete Composites 62, 168e177. https://doi.org/ 10.1016/j.cemconcomp.2015.07.004. El-Hassan, H., Shao, Y., 2014. Dynamic carbonation curing of fresh lightweight concrete. Magazine of Concrete Research. https://doi.org/10.1680/macr.13.00222. El-Hassan, H., Shao, Y., Ghouleh, Z., 2014. Effect of initial curing on carbonation of lightweight concrete masonry units. ACI Materials Journal 441e450. El-Hassan, H., Shao, Y., Ghouleh, Z., 2013. Reaction products in carbonation-cured lightweight concrete. Journal of Materials in Civil Engineering. https://doi.org/10.1061/(ASCE) MT.1943-5533.0000638. Fang, Y., Chang, J., 2017. Rapid hardening b-C2S mineral and microstructure changes activated by accelerated carbonation curing. Journal of Thermal Analysis and Calorimetry. https:// doi.org/10.1007/s10973-017-6165-z. Farnam, Y., Villani, C., Washington, T., Spence, M., Jain, J., Jason Weiss, W., 2016. Performance of carbonated calcium silicate based cement pastes and mortars exposed to NaCl and MgCl2 deicing salt. Construction and Building Materials. https://doi.org/10.1016/ j.conbuildmat.2016.02.098. Fernandez-Carrasco, L., Rius, J., Miravitlles, C., 2008. Supercritical carbonation of calcium aluminate cement. Cement and Concrete Composites. https://doi.org/10.1016/ j.cemconres.2008.02.013. García-Gonzalez, C.A., el Grouh, N., Hidalgo, A., Fraile, J., L opez-Periago, A.M., Andrade, C., Domingo, C., 2008. New insights on the use of supercritical carbon dioxide for the accelerated carbonation of cement pastes. Journal of Supercritical Fluids. https://doi.org/ 10.1016/j.supflu.2007.07.018. Goodbrake, C.J., Young, J.F., Berger, R.L., 1979a. Reaction of hydraulic calcium silicates with carbon dioxide and water. Journal of the American Ceramic Society. https://doi.org/ 10.1111/j.1151-2916.1979.tb19112.x. Goodbrake, C.J., Young, J.F., Berger, R.L., 1979b. Reaction of beta-dicalcium silicate and tricalcium silicate with carbon dioxide and water vapor. Journal of the American Ceramic Society. https://doi.org/10.1111/j.1151-2916.1979.tb19046.x. Goto, S., Suenaga, K., Kado, T., Fukuhara, M., 1995. Calcium silicate carbonation products. Journal of the American Ceramic Society. https://doi.org/10.1111/j.11512916.1995.tb09057.x. Grounds, T., G Midgley, H., V Novell, D., 1988. Carbonation of ettringite by atmospheric carbon dioxide. Thermochimica Acta. https://doi.org/10.1016/0040-6031(88)87407-0. Guan, X., Liu, S., Feng, C., Qiu, M., 2016. The hardening behavior of g-C2S binder using accelerated carbonation. Construction and Building Materials. https://doi.org/10.1016/ j.conbuildmat.2016.03.208. Hargis, C.W., Lothenbach, B., M€uller, C.J., Winnefeld, F., 2017. Carbonation of calcium sulfoaluminate mortars. Cement and Concrete Composites. https://doi.org/10.1016/ j.cemconcomp.2017.03.003.

CO2 sequestration on cement

137

Harrison, J., 2005. Reactive Magnesium Oxide Cements. US Pat. 0103235. He, P., Shi, C., Tu, Z., Poon, C.S., Zhang, J., 2016. Effect of further water curing on compressive strength and microstructure of CO2-cured concrete. Cement and Concrete Composites 72, 80e88. https://doi.org/10.1016/j.cemconcomp.2016.05.026. He, Z., Yang, H., Shao, Y., Liu, M., 2013. Early carbonation behaviour of no-clinker steel slag binder. Advances in Cement Research. https://doi.org/10.1680/adcr.12.00054. Higuchi, T., Morioka, M., Yoshioka, I., Yokozeki, K., 2014. Development of a new ecological concrete with CO2 emissions below zero. Construction and Building Materials. https:// doi.org/10.1016/j.conbuildmat.2014.01.029. Hobbs, D.W., 2001. Concrete deterioration: causes, diagnosis, and minimising risk. International Materials Reviews. https://doi.org/10.1179/095066001101528420. Huijgen, W.J.J., Comans, R.N.J., 2006. Carbonation of steel slag for CO2 sequestration: leaching of products and reaction mechanisms. Environmental Science and Technology. https://doi.org/10.1021/es052534b. Huijgen, W.J.J., Witkamp, G.J., Comans, R.N.J., 2006. Mechanisms of aqueous wollastonite carbonation as a possible CO2 sequestration process. Chemical Engineering Science. https://doi.org/10.1016/j.ces.2006.01.048. Huijgen, W.J.J., Witkamp, G.J., Comans, R.N.J., 2005. Mineral CO2 sequestration by steel slag carbonation. Environmental Science and Technology. https://doi.org/10.1021/es050795f. IEA, 2018. Emissions [WWW Document]. URL. https://www.iea.org/geco/emissions/. (Accessed 13 October 2019). IPCC, 2005. Special Report on Carbon Dioxide Capture and Storage. Ismail, M., Muhammad, B., Ismail, M.E.G., 2010. Compressive strength loss and reinforcement degradations of reinforced concrete structure due to long-term exposure. Construction and Building Materials. https://doi.org/10.1016/j.conbuildmat.2009.12.003. Jang, J.G., Lee, H.K., 2016. Microstructural densification and CO2 uptake promoted by the carbonation curing of belite-rich Portland cement. Cement and Concrete Composites 82, 50e57. https://doi.org/10.1016/j.cemconres.2016.01.001. Jauffret, G., Morrison, J., Glasser, F.P., 2015. On the thermal decomposition of nesquehonite. Journal of Thermal Analysis and Calorimetry. https://doi.org/10.1007/s10973-015-4756-0. Jia, Y., 2012. Natural and accelerated carbonation of concrete containing fly ash and GGBS after different initial curing period. Magazine of Concrete Research 64, 143e150. Johnson, D.C., Macleod, C.L., Carey, P.J., Hills, C.D., 2003. Solidification of stainless steel slag by accelerated carbonation. Environmental Technology. https://doi.org/10.1080/ 09593330309385602. Junior, A.N., Dias, R., Filho, T., Moraes, E. De, Fairbairn, R., Dweck, J., Neves Junior, A., Toledo Filho, R.D., De Moraes Rego Fairbairn, E., Dweck, J., 2015. The effects of the early carbonation curing on the mechanical and porosity properties of high initial strength Portland cement pastes. Construction and Building Materials 77, 448e454. https://doi.org/ 10.1016/j.conbuildmat.2014.12.072. Kashef-Haghighi, S., Ghoshal, S., 2010. CO2 sequestration in concrete through accelerated carbonation curing in a flow-through reactor. In: Industrial and Engineering Chemistry Research, pp. 1143e1149. https://doi.org/10.1021/ie900703d. Kashef-Haghighi, S., Shao, Y., Ghoshal, S., 2015. Mathematical modeling of CO2 uptake by concrete during accelerated carbonation curing. Cement and Concrete Composites 67, 1e10. https://doi.org/10.1016/j.cemconres.2014.07.020. Khan, M.I., Siddique, R., 2011. Utilization of silica fume in concrete: review of durability properties. Resources Conservation and Recycling. https://doi.org/10.1016/j.resconrec.2011.09.016.

138

Start-Up Creation

Khoshnazar, R., Shao, Y., 2018. Characterization of carbonation-cured cement paste using Xray photoelectron spectroscopy. Construction and Building Materials. https://doi.org/ 10.1016/j.conbuildmat.2018.02.175. Klemm, W.A., Berger, R.L., 1972a. Accelerated curing of cementitious systems by carbon dioxide. Part I. Portland cement. Cement and Concrete Composites. https://doi.org/ 10.1016/0008-8846(72)90111-1. Klemm, W.A., Berger, R.L., 1972b. Accelerated curing of cementitious systems by carbon dioxide. Part I. Portland cement. Cement and Concrete Composites 2, 567e576. https:// doi.org/10.1016/0008-8846(72)90111-1. K€ oli€ o, A., Honkanen, M., Lahdensivu, J., Vippola, M., Pentti, M., 2015. Corrosion products of carbonation induced corrosion in existing reinforced concrete facades. Cement and Concrete Composites. https://doi.org/10.1016/j.cemconres.2015.07.009. Kunal, Siddique, R., Rajor, A., Kunal, P., Siddique, R., Rajor, A., 2012. Use of cement kiln dust in cement concrete and its leachate characteristics. Resources Conservations and Recycling. https://doi.org/10.1016/j.resconrec.2012.01.006. Limbachiya, M.C., Roberts, J.J., 2004. Hardened properties of recycled aggregate concrete prepared with fly ash. In: Proc. Int. Conf. Sustain. Waste Manag. Recycl. challenges Oppor. Thomas Telford, London, UK, pp. 189e197. Lothenbach, B., Scrivener, K., Hooton, R.D., 2011. Supplementary cementitious materials. Cement and Concrete Composites. https://doi.org/10.1016/j.cemconres.2010.12.001. MacMaster, D., Tavares, O., 2015. Carbon sequestration of concrete masonry units. ACI Materials Journal. https://doi.org/10.14359/51688069. Mahoutian, M., Shao, Y., 2016. Production of cement-free construction blocks from industry wastes. Journal of Cleaner Production 137, 1339e1346. https://doi.org/10.1016/ j.jclepro.2016.08.012. Maslehuddin, M., Al-Amoudi, O.S.B., Rahman, M.K., Ali, M.R., Barry, M.S., 2009. Properties of cement kiln dust concrete. Construction and Building Materials 23, 2357e2361. https:// doi.org/10.1016/j.conbuildmat.2008.11.002. Meyer, V., De Cristofaro, N., Bryant, J., Sahu, S., 2018. Solidia cement an example of carbon capture and utilization. In: Key Engineering Materials. https://doi.org/10.4028/ www.scientific.net/KEM.761.197. Mikulcic, H., Vujanovic, M., Markovska, N., Filkoski, R.V., Ban, M., Duic, N., 2013. CO2 emission reduction in the cement industry. Chemical Engineering Transactions 35, 703e708. https://doi.org/10.3303/CET1335117. Mo, L., Panesar, D.K., 2013. Accelerated carbonation - a potential approach to sequester CO2 in cement paste containing slag and reactive MgO. Cement and Concrete Composites. https:// doi.org/10.1016/j.cemconcomp.2013.07.001. Mo, L., Panesar, D.K., 2012. Effects of accelerated carbonation on the microstructure of Portland cement pastes containing reactive MgO. Cement and Concrete Composites. https://doi.org/10.1016/j.cemconres.2012.02.017. Mo, L., Zhang, F., Deng, M., 2016a. Mechanical performance and microstructure of the calcium carbonate binders produced by carbonating steel slag paste under CO2 curing. Cement and Concrete Composites 88, 217e226. https://doi.org/10.1016/j.cemconres.2016.05.013. Mo, L., Zhang, F., Deng, M., Panesar, D.K., 2016b. Effectiveness of using CO2 pressure to enhance the carbonation of Portland cement-fly ash-MgO mortars. Cement and Concrete Composites. https://doi.org/10.1016/j.cemconcomp.2016.03.013. Monkman, S., Kenward, P.A., Dipple, G., MacDonald, M., Raudsepp, M., 2018. Activation of cement hydration with carbon dioxide. Journal of Sustainable Cement Materials. https:// doi.org/10.1080/21650373.2018.1443854.

CO2 sequestration on cement

139

Monkman, S., MacDonald, M., 2016. Carbon dioxide upcycling into industrially produced concrete blocks. Construction and Building Materials. https://doi.org/10.1016/ j.conbuildmat.2016.07.046. Monkman, S., MacDonald, M., Hooton, R.D., Sandberg, P., 2016. Properties and durability of concrete produced using CO2 as an accelerating admixture. Cement and Concrete Composites. https://doi.org/10.1016/j.cemconcomp.2016.10.007. Monkman, S., Shao, Y., 2010a. Integration of carbon sequestration into curing process of precast concrete. Canadian Journal of Civil Engineering. https://doi.org/10.1139/L09-140. Monkman, S., Shao, Y., 2010b. Carbonation curing of slag-cement concrete for binding CO2 and improving performance. Journal of Materials in Civil Engineering. https://doi.org/ 10.1061/(ASCE)MT.1943-5533.0000018. Monkman, S., Shao, Y., 2006. Assessing the carbonation behavior of cementitious materials. Journal of Materials in Civil Engineering 18, 768e776. https://doi.org/10.1061/(ASCE) 0899-1561(2006)18:6(768). Najim, K.B., Mahmod, Z.S., Atea, A.K.M., 2014. Experimental investigation on using Cement Kiln Dust (CKD) as a cement replacement material in producing modified cement mortar. Construction and Building Materials 55, 5e12. https://doi.org/10.1016/ j.conbuildmat.2014.01.015. National Public Radio, 2011. What Countries Are Doing to Tackle Climate Change. https:// www.npr.org/2011/12/07/143302823/what-countries-are-doing-to-tackle-climate-change. Neville, A.M., Brooks, J.J., 2010. Concrete Technology, Building and Environment. https:// doi.org/10.1016/0360-1323(76)90009-3. Nishikawa, T., Suzuki, K., Ito, S., Sato, K., Takebe, T., 1992. Decomposition of synthesized ettringite by carbonation. Cement and Concrete Composites. https://doi.org/10.1016/00088846(92)90130-N. Nochaiya, T., Wongkeo, W., Chaipanich, A., 2010. Utilization of fly ash with silica fume and properties of Portland cement-fly ash-silica fume concrete. Fuel. https://doi.org/10.1016/ j.fuel.2009.10.003. Panesar, D.K., Mo, L., 2013. Properties of binary and ternary reactive MgO mortar blends subjected to CO2 curing. Cement and Concrete Composites 38, 40e49. https://doi.org/ 10.1016/j.cemconcomp.2013.03.009. Peethamparan, S., Wong, S.F., Wee, T.H., Swaddiwudhipong, S., 2003. Carbonation of concrete containing mineral admixtures. Journal of Materials in Civil Engineering. https://doi.org/ 10.1061/(ASCE)0899-1561(2003)15:2(134). Pu, L., Unluer, C., 2016. Investigation of carbonation depth and its influence on the performance and microstructure of MgO cement and PC mixes. Construction and Building Materials. https://doi.org/10.1016/j.conbuildmat.2016.05.067. Qian, L., Jiaxiang, L., Liqian, Q., 2016. Effects of temperature and carbonation curing on the mechanical properties of steel slag-cement binding materials. Construction and Building Materials 124, 999e1006. https://doi.org/10.1016/j.conbuildmat.2016.08.131. Rostami, V., Shao, Y., Boyd, A.J., 2012a. Carbonation curing versus steam curing for precast concrete production. Journal of Materials in Civil Engineering 24, 1221e1229. https:// doi.org/10.1061/(ASCE)MT.1943-5533.0000462. Rostami, V., Shao, Y., Boyd, A.J., 2011. Durability of concrete pipes subjected to combined steam and carbonation curing. Construction and Building Materials 25, 3345e3355. https://doi.org/10.1016/j.conbuildmat.2011.03.025. Rostami, V., Shao, Y., Boyd, A.J., He, Z., 2012b. Microstructure of cement paste subject to early carbonation curing. Cement and Concrete Composites 42, 186e193. https://doi.org/ 10.1016/j.cemconres.2011.09.010.

140

Start-Up Creation

Roy, S.K., Poh, K.B., Northwood, D.O., 1999. Durability of concrete - accelerated carbonation and weathering studies. Building and Environment. https://doi.org/10.1016/S03601323(98)00042-0. Shao, Y., El-Hassan, H., 2013. CO2 utilization in concrete. In: Sustainable Construction Materials and Technologies. Shao, Y., Mirza, M.S., Wu, X., 2006a. CO2 sequestration using calcium-silicate concrete. Canadian Journal of Civil Engineering 1, 776e784. https://doi.org/10.1139/L05-105. Shao, Y., Rostami, V., He, Z., Boyd, A.A., 2014a. Accelerated carbonation of portland limestone cement. Journal of Materials in Civil Engineering. https://doi.org/10.1061/(ASCE) MT.1943-5533.0000773. Shao, Y., Rostami, V., Jia, Y., Hu, L., 2014b. Feasibility study on replacing steam by carbon dioxide for concrete masonry units curing. In: Masonry 2014. https://doi.org/10.1520/ stp157720130134. Shao, Y., Shi, C., 2006. Carbonation curing for making concrete products e an old concept and a renewed interest. In: Proceedings of the 6th International Symposium on Cement and Concrete, pp. 823e830. Xian, China. Shao, Y., Xudong, Z., Monkman, S., Shao, Y., Zhou, X., Monkman, S., 2006b. A new CO2 sequestration process via concrete products production. In: 2006 IEEE EIC Climate Change Technology Conference, EICCCC 2006. https://doi.org/10.1109/ EICCCC.2006.277189. Sharma, D., Goyal, S., 2018. Accelerated carbonation curing of cement mortars containing cement kiln dust: an effective way of CO2 sequestration and carbon footprint reduction. Journal of Cleaner Production 192, 844e854. https://doi.org/10.1016/ j.jclepro.2018.05.027. Shi, C., He, F., Wu, Y., 2012a. Effect of pre-conditioning on CO2 curing of lightweight concrete blocks mixtures. Construction and Building Materials 26, 257e267. https://doi.org/ 10.1016/j.conbuildmat.2011.06.020. Shi, C., Liu, M., He, P., Ou, Z., 2012b. Factors affecting kinetics of CO2 curing of concrete. Journal of Sustainable Cement Materials. https://doi.org/10.1080/21650373.2012.727321. Shi, C., Wang, D., He, F., Liu, M., 2012c. Weathering properties of CO2-cured concrete blocks. Resources Conservation and Recycling 65, 11e17. https://doi.org/10.1016/ j.resconrec.2012.04.005. Shi, C., Wu, Y., 2008. Studies on some factors affecting CO2 curing of lightweight concrete products. Resources Conservation and Recycling. https://doi.org/10.1016/ j.resconrec.2008.05.002. Shtepenko, O., Hills, C., Brough, A., Thomas, M., 2006. The effect of carbon dioxide on b-dicalcium silicate and Portland cement. Chemical Engineering Journal. https://doi.org/ 10.1016/j.cej.2006.02.005. Siddique, R., 2011. Utilization of silica fume in concrete: review of hardened properties. Resources Conservation and Recycling. https://doi.org/10.1016/j.resconrec.2011.06.012. Siddique, R., Bennacer, R., 2012. Use of iron and steel industry by-product (GGBS) in cement paste and mortar. Resources Conservation and Recycling 69, 29e34. https://doi.org/ 10.1016/j.resconrec.2012.09.002. Song, H.W., Kwon, S.J., 2007. Permeability characteristics of carbonated concrete considering capillary pore structure. Cement and Concrete Composites. https://doi.org/10.1016/ j.cemconres.2007.03.011. Temple, J., 2019. Startups Looking to Suck CO2 from the Air Are Suddenly Luring Big Bucks. MIT Technol. Rev. https://www.technologyreview.com/s/613447/startups-looking-tosuck-c02-from-the-air-are-suddenly-luring-big-bucks/.

CO2 sequestration on cement

141

Tonoli, G.H.D., Santos, S.F., Savastano, H., Delvasto, S., Mejía De Gutiérrez, R., Lopez De Murphy, M.D.M., 2011. Effects of natural weathering on microstructure and mineral composition of cementitious roofing tiles reinforced with fique fibre. Cement and Concrete Composites. https://doi.org/10.1016/j.cemconcomp.2010.10.013. Torgal, F.P., Shi, C., Palomo, A. (Eds.), 2018. Carbon Dioxide Sequestration in Cementitious Construction Materials, first ed. Woodhead Publishing. Toutanji, H., Delatte, N., Aggoun, S., Duval, R., Danson, A., 2004. Effect of supplementary cementitious materials on the compressive strength and durability of short-term cured concrete. Cement and Concrete Composites. https://doi.org/10.1016/ j.cemconres.2003.08.017. Ukwattage, N.L., Ranjith, P.G., Li, X., 2017. Steel-making slag for mineral sequestration of carbon dioxide by accelerated carbonation. Measurement: Journal of the International Measurement Confederation. https://doi.org/10.1016/j.measurement.2016.10.057. Unluer, C., 2018. Carbon dioxide sequestration in magnesium-based binders. In: Carbon Dioxide Sequestration in Cementitious Construction Materials. https://doi.org/10.1016/ b978-0-08-102444-7.00007-1. Unluer, C., Al-Tabbaa, A., 2014. Enhancing the carbonation of MgO cement porous blocks through improved curing conditions. Cement and Concrete Composites. https://doi.org/ 10.1016/j.cemconres.2014.02.005. Vandeperre, L.J., Al-Tabbaa, A., 2007. Accelerated carbonation of reactive MgO cements. Advances in Cement Research. https://doi.org/10.1680/adcr.2007.19.2.67. Wang, S., Mazzotti, M., Carlos, J., Allam, R., Lackner, K.S., Meunier, F., Rubin, E.M., Sanchez, J.C., Yogo, K., Zevenhoven, R., Wu, Y., Peng, K., 2007. Carbonation of cementbased products with pure carbon dioxide and flue gas. JOM. https://doi.org/10.1007/ s11837-018-2827-y. Xuan, D., Zhan, B., Poon, C.S., 2016. Development of a new generation of eco-friendly concrete blocks by accelerated mineral carbonation. Journal of Cleaner Production. https://doi.org/ 10.1016/j.jclepro.2016.06.062. Young, J.F., Berger, R.L., Breese, J., 1974. Accelerated curing of compacted calcium silicate mortars on exposure to CO2. Journal of the American Ceramic Society 57, 394e397. https://doi.org/10.1111/j.1151-2916.1974.tb11420.x. Zhan, B., Poon, C., Shi, C., Baojian, Z., Chisun, P., Caijun, S., 2013a. CO2 curing for improving the properties of concrete blocks containing recycled aggregates. Cement and Concrete Composites 42, 1e8. https://doi.org/10.1016/j.cemconcomp.2013.04.013. Zhan, B., Sun, C., Liu, Q., Kou, S., Shi, C., 2013b. Experimental study on CO2 curing for enhancement of recycled aggregate properties. Construction and Building Materials 7e11. https://doi.org/10.1016/j.conbuildmat.2013.09.008. Zhan, B.J., Sun, C., Jun, C., Zhan, B.J., Poon, C.S., Shi, C.J., 2016. Materials characteristics affecting CO2 curing of concrete blocks containing recycled aggregates. Cement and Concrete Composites 67, 50e59. https://doi.org/10.1016/j.cemconcomp.2015.12.003. Zhang, D., Asce, S.M., Cai, X., Shao, Y., 2016. Carbonation curing of precast fly ash concrete. ASCE Journal of Materials in Civil Engineering 28, 1e9. https://doi.org/10.1061/(ASCE) MT.1943-5533.0001649. Zhang, D., Ghouleh, Z., Shao, Y., 2017. Review on carbonation curing of cement-based materials. Journal of CO2 Utilization 21, 119e131. https://doi.org/10.1016/ j.jcou.2017.07.003. Zhang, D., Shao, Y., 2018. Surface scaling of CO2-cured concrete exposed to freeze-thaw cycles. Journal of CO2 Utilization. https://doi.org/10.1016/j.jcou.2018.07.012.

142

Start-Up Creation

Zhang, D., Shao, Y., 2016a. Early age carbonation curing for precast reinforced concretes. Construction and Building Materials 113, 134e143. https://doi.org/10.1016/j.conbuildmat. 2016.03.048. Zhang, D., Shao, Y., 2016b. Effect of early carbonation curing on chloride penetration and weathering carbonation in concrete. Construction and Building Materials 123, 516e526. https://doi.org/10.1016/j.conbuildmat.2016.07.041. Zhang, R., Panesar, D.K., 2018. Water absorption of carbonated reactive MgO concrete and its correlation with the pore structure. Journal of CO2 Utilization 24, 350e360. https://doi.org/ 10.1016/j.jcou.2018.01.026. Zhao, Y., Jin, W., 2016. Steel corrosion in concrete. In: Steel Corrosion-Induced Concrete Cracking. https://doi.org/10.1016/b978-0-12-809197-5.00002-5. Zheng, L., Xuehua, C., Mingshu, T., 1991. MgO-type delayed expansive cement. Cement and Concrete Composites. https://doi.org/10.1016/0008-8846(91)90065-P.

Carbon dioxide sequestration on mortars containing recycled aggregates: a hot area for startup development

7

M. Mastali 1 , Z. Abdollahnejad 1 , F. Pacheco-Torgal 1, 2 1 C-TAC Research Centre, University of Minho, Guimar~aes, Portugal; 2SHRC, University of Sungkyunkwan, Suwon, Republic of Korea

7.1

Introduction

According to Watts (2018), in February of last year, the temperatures in the Arctic remained 20 C above the average for longer than a week having increased the melting rate. As a consequence, the replacement of ice by water will lead to a higher absorption of solar radiation that makes oceans warmer being responsible for basal ice melting (Tabone et al., 2019) and also for a warmer atmosphere (Ivanov et al., 2016). This constitutes a positive feedback that aggravates the problem. Two years ago, Wadhams (2017) already stated that an ice-free Arctic will occur in the next few years, and that it will likely increase by 50% the warming caused by the CO2 produced by human activity. The latest data on rates of melting combined with new models suggest that an ice-free Arctic summer could occur by 2030 (Screen and Deser, 2019; Bendell, 2018).The warming of the Earth will also result in extensive permafrost thaw in the Northern Hemisphere. With thaw, large amounts of organic carbon are mobilized, some of which is converted and released into the atmosphere as greenhouse gases. This, in turn, facilitates a positive permafrost carbon feedback and thus further warming. Turetsky reported that permafrost thawing could release between 60 billion and 100 billion tonnes of carbon. This is in addition to the 200 billion tonnes of carbon expected to be released in other regions that will thaw gradually. The world is closer to exceeding the budget (cumulative amount of anthropogenic CO2 emission compatible with a global temperatureechange target) for the long-term target of the Paris Climate Agreement than previously thought. And according to Xu et al. (2018), three lines of evidence suggest that global warming will be faster than projected in the recent IPCC special report. First, greenhouse gas emissions are still rising. Second, governments are cleaning up air pollution faster than the IPCC and most climate modelers have assumed. But aerosols, including sulfates, nitrates, and organic compounds, reflect sunlight so the aforementioned cleaning could have a warming effect by as much as 0.7 C. And in third place, there are signs that the planet might be entering a natural warm phase because the Pacific Ocean seems to be warming up, in accord

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00007-2 Copyright © 2020 Elsevier Ltd. All rights reserved.

144

Start-Up Creation

with a slow climate cycle known as the Interdecadal Pacific Oscillation that could last for a couple of decades. And these three forces reinforce each other. Therefore, some authors (Hansen et al., 2017) state that carbon dioxide sequestration is crucial so targets for limiting global warming can be achieved. That is why carbon sequestration constitutes one of the Grande Challenges of Engineering (Mote et al., 2016). Europe is now putting great efforts and funding in carbon sequestration materials and technologies. The flagship program EnCO2re, with public launch in 2016, currently looks to develop new technologies offering novel ways to use CO2; increase awareness for CO2 reuse; and ensure sustainability and social acceptance of materials and products by integrated socioecological research. Also carbon capture and sequestration is one of the 100 Radical Innovation Breakthroughs for the future (Europe, 2019). Currently, this carbon sequestration is carried out mostly through geologic CO2 storage in saline aquifers (Zhang and Huisingh, 2017). However, that constitutes a passive strategy has large risks and also has a very high cost. Carbon capture and storage from the stream of concentrated CO2 at fossil fuel burning sites like power plants or steel plants is more efficient and thus less expensive than direct air capture (Hansen et al., 2017). As a consequence, it is important to study how CO2 generated by power plants and other facilities can be sequestrated in valuable products. Several authors (Bertos et al., 2004; Jang et al., 2016) have studied the use of CO2 as accelerated curing of cementitious construction materials. This technology will in future prevent carbon dioxide to be released into the atmosphere but also to accelerate curing and strength development of those materials. However, so far no studies were performed using alkali-activatedebased materials. These materials are produced through the reaction of an aluminosilicate powder with an alkaline activator, usually composed by hydroxide, silicate, carbonate, or sulfate leading to the formation an amorphous aluminosilicate gel and secondary nanocrystalline zeolite-like structures (Provis, 2014). These materials have a particular ability for the reuse of several types of wastes (Paya et al., 2014; Bernal et al., 2016). Some wastes like fly ash deserve a special attention because they are generated in a very high amount and have a very low reuse rate. United States has a reuse rate for fly ash of around 50% meaning that 30 million tons of fly ash are not reused annually (ACAA, 2016). Waste glass is also a waste that is generated in relevant quantities and that merits increase recycling efforts. In 2010, approximately 425,000 tons of waste glass was produced in Portugal and only 192,000 tons were recycled. In Hong Kong, approximately 373 tons of waste glass is generated daily in 2010. The high volume of construction and demolition wastes (CDWs) also constitutes a serious problem. Eurostat estimates the total for Europe of around 1000 million tons/year, representing an average value of almost 2.0 ton/per capita. The reuse of CDW as recycled aggregates not only constitutes a way to give value to a waste but also prevents the use of river sand being necessary to achieve the 70% target until 2020 in EU (Pacheco-Torgal et al., 2013). Furthermore, the use of cementitious building materials reinforced with natural fibers could be a way to achieve a more sustainable construction. Natural fibers are a renewable resource and are available almost all over the world. Vegetable fibers and cement-based composites are as stronger as composites based on synthetic fibers, cost-effectiveness, and above all are environmental friendly (Pacheco-Torgal and Jalali, 2011). Moreover, their

Carbon dioxide sequestration on mortars containing recycled aggregates

145

environmental impact is lower than traditional building materials because relatively large amounts of atmospheric CO2 can be sequestrated through photosynthesis (Shea et al., 2012). Among the new vegetable fibers used, hemp stands out from the rest because of its wide availability, low requirements of fertilizer and irrigation, good humidity control and favorable energy, and ecological balances (Zermenno et al., 2016). That is why research on cement composites reinforced by natural fibers constitutes an important trend in the sustainability context (Onuaguluchi and Banthia, 2016). Natural fibers can degrade in high alkaline environment of Portland cement composites (Gram, 1983). However, several authors (Agopyan et al., 2005; Tonoli et al., 2010) showed that carbonation is associated with a lower alkalinity that can help preserve both the properties and durability of composites reinforced with natural fibers. This means that accelerated carbonation of composites reinforced with natural fibers has not only carbon sequestration advantages but is also especially indicated for such composites. This paper discloses results of an investigation concerning the performance of fly ash/waste glass alkalineebased mortars with recycled aggregates reinforced by hemp fibers exposed to accelerated carbon dioxide curing.

7.2

Experimental program

7.2.1

Materials

The mortars were made of fly ash (FA), calcium hydroxide (CH), waste glass (MG), ordinary Portland cement (OPC), recycled aggregates, and a sodium hydroxide solution. The fly ash was obtained from The PEGO Thermal Power Plant in Portugal and categorized as class B and group N regarding the ASTM C618-15. Table 7.1 presents the major oxides of fly ash particles. The Portland cement is of type I class 42.5R from SECIL, its composition contains 63.3% CaO, 21.4% SiO2, 4.0% Fe2O, 3.3% Al2O3, 2.4% MgO, and other minor components. The calcium hydroxide was supplied by LUSICAL H100 and contains more than 99% CaO. Waste glass from glass bottles ground for 1 hour in a ball mill was also used. The final density of the milled waste glass was 1.27 g/cm3. Solid sodium hydroxide was supplied by ERCROS, S.A., Spain, and was used to prepare the 8M NaOH solution. Distilled water was used to dissolve the sodium hydroxide flakes to avoid the effect of unknown contaminants in the mixing water. The NaOH mix was made 24 h prior to use in order to have a homogenous solution at room temperature. A recycled sand to binder ratio of 4 was used in all the mixtures. The recycled sand was obtained from the crushing of concrete blocks. The Table 7.1 Chemical composition of major oxides in fly ash. Oxides (wt.%) Material

SiO2

Al2O3

Fe2O3

CaO

MgO

Na2O

K2O

TiO2

Fly ash

60.81

22.68

7.64

1.01

2.24

1.45

2.70

1.46

146

Start-Up Creation

average compressive strength of concrete blocks was around 40 MPa. A preliminary sieving operation was carried out to remove both coarser and dust particles before being used. The dimension of the sieves was 4.75 and 0.6 mm. The sand was dried at 105 C for 24 h until constant mass was achieved. After the preliminary sieving, a standard sieving was carried out showing that the recycle sand has a fineness modulus of 3.885. The detailed grain size distribution of the recycled sand is presented in Fig. 7.1. The recycled sand has a water absorption by immersion of 13% having being determined with a 24-h saturation according to EN 1097-6. Before use the recycled sand was carbonated in a carbon chamber from Aralab model Fitoclima S600 (4.2% CO2, 40% RH, and 20 C) for 48 h. The recycled sand has a water absorption of 25%. The explanation for the increase of the water absorption relates to the fact that when CSH carbonates its Ca/Si ratio drops and it becomes highly porous. Studies by NMR spectroscopy indicate that decomposition of CeSeH caused by carbonation involves two steps: (1) a gradual decalcification of the CeSeH, where calcium is removed from the interlayer and defect sites in the silicate chains until Ca/Si ¼ 0.67 is reached, ideally corresponding to infinite silicate chains; (2) calcium from the principal layers is consumed, resulting in the final decomposition of the CeSeH and the formation of an amorphous silica phase (Savija and Lukovic, 2016). The mortars were reinforced by different weight percentage of hemp shiv fibers that were supplied by Canapor. No surface treatment was used for the hemp shiv fibers in order to avoid cost increase and maintain its eco-effectiveness. Table 7.2 shows the composition of calcined hemp. The characterization of hemp shiv fibers was implemented based on a statistical analysis to evaluate the variability of the fiber length, which was defined by using 200 fibers. Regarding the statistical analysis, most fiber lengths varied in the range of 20e30 mm (Fig. 7.2).

90 80 70 60 50 40

Recycled aggregate

30 20

10 0 0.01

0.1

1

Particle diameter (mm)

Figure 7.1 Distribution of sand particles.

10

100

Cumulative percentage of sand retained (%)

100

Carbon dioxide sequestration on mortars containing recycled aggregates

147

Table 7.2 Chemical composition of major oxides in calcined hemp. Oxides (wt.%) Material

SiO2

SO3

P2O5

CaO

Fe2O3

Na2O

K2O

Mg

Calcined hemp

24.6

4.60

3.0

44.0

0.78

9.78

12.10

0.40

Figure 7.2 Hemp shiv fibers.

7.2.2

Mix design and mortar production

The composition of the mortars is shown in Table 7.3. In the batching process of the mortars, dry ingredients (fly ash, recycled sand, calcium hydroxide (or cement), metakaolin, and milled glass) were mixed for 2 min. Then, sodium hydroxide was added and again mixed for 3 min. Finally, the hemp fibers were added and all the ingredients were mixed for 3 more minutes. Then, the mixed mortars were cast into cubic molds (50 mm3  50 mm3  50 mm3) to assess the compressive strength and in prismatic beams with dimension (40 mm  40 mm  160 mm) to assess the flexural strength. The specimens were cured for 24 h at the lab conditions (averagely 25 C and 40% RH) and then they were demolded. Then the specimens were cured in the carbonation chamber (4.2% CO2 concentration and 40% RH) for 7 days and curing in the lab conditions for the remaining days until the age of the test. This is because preliminary experiments showed that all mixtures were fully carbonated during 7 days through a CO2 preconditioning curing. Three specimens with dimension of 50 mm3  50 mm3  50 mm3 were casted and used to measure the CO2 sequestration in the mixture without hemp fibers by using a furnace decomposition method (El-Hassan and Shao, 2015). The carbonated specimens were placed initially in the

148

Table 7.3 Proportions of mix compositions (kg/m3). Mixtures

Fly ash

CH

MG

SH

Sand

Molarity (mol/L)

80FA_10CH_10MG_RAGC_8M_0%

340.0

42.5

42.5

215.5

1700.0

8

Hemp fiber 0.0

80FA_10CH_10MG_RAGC_8M_4%

17.0

80FA_10CH_10MG_RAGC_8M_6%

25.5

80FA_10CH_10MG_RAGC_8M_8%

34.0

CH, calcium hydroxide; FA, fly ash; MG, milled glass; SH, sodium hydroxide.

Start-Up Creation

Carbon dioxide sequestration on mortars containing recycled aggregates

149

oven at 105 C during 24 h to evaporate any absorbed water. Then, the weights of the dried specimens were recorded. Afterward, the specimens were put in the calciner at a temperature between 500 and 850 C during 4 h to measure the water bound to hydration products and carbon dioxide in carbonates. The results revealed that 800 C could be used as the appropriate decomposition temperature. The compressive strengths of the mixtures were assessed at different ages of 7, 14, and 28 days. The compressive strength of each mixture was obtained by averaging the replicated three cubes. All cubic specimens were assessed under compressive load with a constant displacement rate of 0.30 N/mm2.s, based on the ASTM C109 recommendation. The compressive load was measured with a load cell of 200 kN capacity. Flexural performance was assessed under three-point bending (TPB) load conditions, as indicated in Figs. 7.3 and 7.4. The flexural load was applied to the beams with a displacement rate of 0.6 mm/min. The flexural load was measured with a load cell of 50 kN capacity. Eq. (7.2) was used to calculate the flexural strength of specimens under TPB test: sf ¼

3FL 2bh2

(7.2)

16

40

where F is the total flexural load, L is span length, b and h are width (40 mm) and height (40 mm) of beams, respectively. Freeze/thaw resistance was assessed using three cubic specimens per mixture with dimension 100 mm  100 mm  100 mm were cast and tested after 28 days under compressive test. The equipment for freezeethaw is Aralab model Fitoclima 1000. The freezeethaw test was carried out according to PD CEN/TS 12390e9:2016 standard with temperatures ranged from 18 to þ20 C. The specimens were kept 13 h in 18 C and 3 h in þ20 C. The transitions from positive to negative and negative to positive temperatures took 3 and 5 h, respectively. Fig. 7.6 shows a freezeethaw cycle. The specimens were submitted to 50 cycles.

0

40

Loading cap

40

Prismatic beams

Steel plate 20

120

20

Figure 7.3 Adopted test setup for implementation of the flexural test.

150

Start-Up Creation 25

Temperature (°C)

20 15 10 5 0 –5

0

2

4

6

8

10

12

14

16

18

20

22

24

–10 –15 –20

Time (hours)

Figure 7.4 Temperature variation for one freeze/thaw cycle.

7.3 7.3.1

Results and discussion Compressive strength

Fig. 7.5 shows the effects of different hemp shiv fiber contents on the compressive strength of fly ashebased alkaline mortars according to curing age. At 7 days, the reference mixture without fibers shows a compressive strength of about 7 MPa. This compressive strength level is lower for a structural application but is enough for masonry units. The use of accelerated carbonation makes CO2 to diffuse through the pore network of the material, dissolving in the pore solution to form HCO3. This anion is a weak acid that will react with calcium-rich hydration products promoting the formation of calcium carbonates through a decalcification process (Bernal, 2014). The main calcium-rich hydration product is CeSeH because this study used a low sodium hydroxide concentration (Garcia-Lodeiro et al., 2016). The results show that the addition of hemp fibers leads to a reduction of compressive strength because fibers increase the porosity. This was also confirmed by other authors who studied the performance of composites containing hemp fibers (Li et al., 2006). For a hemp fiber content of 4%, a 20% reduction on compressive strength is noticed, while for an 8% fiber content, a 45% reduction on compressive strength is noticed. At 14 curing days, the reference mixture shows an increase of compressive strength of around 9 MPa representing a 30% increase concerning 7 days curing. From 14 curing to 28 curing days, a 10% increase in compressive strength was also noticed. At 28 curing days, the strength loss remains at 20% when 4% hemp fibers are used. However, the use of a hemp fiber content of 8% shows a low compressive strength when compared to 7 days curing it increased only 10% in compressive strength. It seems that a certain amount of hemp fibers can prevent the hydration products to become denser. Sedan et al. (2008) have reported that pectin can in fact fix calcium preventing the formation of CSH. Some studies show that hemp fibers have a pectin content of around 7.9% (Balciunas et al., 2015). Recent studies (Diquelou et al., 2015) also confirm that hemp fibers act as retarding agents, reducing compressive and flexural strength. The results of the present

Carbon dioxide sequestration on mortars containing recycled aggregates

Compressive strength (MPa)

12 10 8 6 4 2

Compressive strength (MPa)

% _8

%

M

_6

_8

M

C _C C AG _R G 0M _1 H 0C

FA _1

10 8 6 4 2 % _8

%

M

_6

_8

M

C

_8

_C

C

C

_C

AG

C

_R

AG

G

_R

0M

G

_1

0M

H

_1

C

H

10

10 FA _ 80

80

FA _

10

C

C

C

H

H

_1

_1

0M

0M

G

G

_R

_R

AG

AG

C

C

_C

_C

C

C

_8

_8

M

M

_4

_0

%

%

0

10 FA _ 80

80

12

FA _

(b)

_8 C _C C AG _R G 0M _1 H 0C

FA _1 80

80

80

FA _

FA _1

10

0C

C

H

H

_1

_1

0M

0M

G

G

_R

_R

AG

AG

C

C

_C

_C

C

C

_8

_8

M

M

_4

_0

%

%

0

80

(a)

151

Figure 7.5 Compressive strength of mixtures cured for (a) 7 days; (b) 14 days; and (c) 28 days.

investigation show that 6% hemp fiber is the maximum content for masonry applications. Valle-Zerme~no et al. also investigated the mechanical properties of magnesium phosphate cements reinforced with hemp fibre. The Hemp fibre percentages studied included 8%, 12%, 16%, and 20% total weight of dry ingredient. For a hemp fibre content of 8% they noticed a severe compressive strength reduction of from 30 MPa to just 10 MPa after 1 curing days and from 45 MPa to 12 MPa at 28 days. This severe reduction on compressive strength may be related to the fact that the high alkaline environment of the mixtures may degrade the structure of the fibers.

Figure 7.6 Flexural strength.

80

80

FA _

FA _

10

C

H

_1

0M

G

_R

AG

C

_C

C

_8

M

_6

%

%

%

%

_4

_0

_8

M

M

M

_8

_8

_8

C

C

C

_C

_C

_C

C

C

C

AG

AG

AG

_R

_R

_R

G

G

G

0M

0M

0M

_1

_1

_1

H

H

H

C

C

C

10

10

10

FA _

FA _

Flexural strength (MPa)

80

80 FA _

FA _

10

10

C

C

H

H

_1

_1

0M

0M

G

G

_R

_R

AG

AG

C

C

_C

_C

C

C

_8

_8

M

M

_8

_6

%

%

%

%

_0

_4

M

M

_8

_8

C

C

_C

_C

C

C

AG

AG

_R

_R

G

G

0M

0M

_1

_1

H

H

C

C

10

10

FA _

FA _

80

80

Compressive strength (MPa)

(c)

80

80

152 Start-Up Creation

12

10 8

6

4

2

0

Figure 7.5 cont'd.

3.5 4

3

2.5

1.5 2

0.5 1

0

Carbon dioxide sequestration on mortars containing recycled aggregates

7.3.2

153

Flexural strength

Fig. 7.6 shows the effects of reinforcing fly ash alkaline-based mortars containing recycled aggregates with hemp shiv fibers at 28 curing days. Regarding the results, addition of fibers consistently reduced the flexural strength due to nonhomogeneous mix and, consequently, a poor adhesion between the fibers and the matrix. The use of just 4% of hemp fibers leads to flexural strength loss of about 25%. The maximum reduction in the flexural strength due to the addition of fiber was detected bout 40% in the mixture containing 8% hemp fiber (2.13 MPa), as compared to the plain mixture (3.45 MPa). Fig. 7.7 shows relevant correlations between the mechanical properties and the hemp fiber content. Fr denotes the flexural strength and Wf is the weight of hemp fiber. A high correlation (R2 ¼ 0.86) between compressive strength and flexural strength is noticed. A higher negative correlation (R2 ¼ 0.97) was found between compressive strength and hemp fiber content.

7.3.3

Resistance to freezeethaw

Fig. 7.8 shows the results of compressive strength of reference mixtures cured at ambient temperature and the compressive strength of mixtures after 50 cycles of freeze/thaw. The results show that the mixtures with fiber content show a lower frost resistance when compared to the mixture without fibers. After 50 cycles of freeze/ thaw, the mixture with no fiber shows a compressive strength loss of just 10%, while the mixtures with fibers show a compressive reduction of around 18%. The fiber content shows no direct influence regarding frost resistance. When water freezes in the pores of the matrix, an expansion in the volume of frozen water occurs, forcing the amount of excess water through the boundaries. The magnitude of this hydraulic pressure depends on the permeability of the matrix, the degree of saturation, the distance to the nearest unfilled void, and the rate of freezing, so that this hydraulic pressure exceeds the tensile strength of the paste, it forms the cracks. On further freezing cycles, new cracks will be formed and the deterioration will proceed.

9

Fr = 0.2364Fc + 0.9619 R2 = 0.863

3.5

8 7

3

6

2.5

5

2

4

1.5

3

1

Wf = –1.5355Fc + 15.623 R2 = 0.9709

0.5 0

0

2

4 6 8 10 Compressive strength (MPa)

2 1 12

Weight of hemp fiber (%)

Flexural strength (MPa)

4

0

Figure 7.7 Correlation between compressive strength, flexural strength, and hemp fiber content.

Start-Up Creation Compressive strength (MPa)

154 18 16 14 12 10 8 6 4 2 0

Ambient

%

%

_8

_6

M

M

_8

_8

C

C

AG

AG

_R

_R

G

G

0M

0M

_1

_1

H C

C

10

10

FA _

FA _

80

80

80

FA _

80

10

C

FA _

H

10

_1

C

H

H

0M

_1

G

0M

_R

G

AG

_R

C

_C

AG

C

C

_8

_8

M

M

_0

_4

%

%

Freeze/thaw

Figure 7.8 Effects of freeze/thaw on the compressive strength.

7.3.4

Carbon footprint

The global warming potential (GWP) of the different mixtures was calculated using the individual GWP values taken from the Ecoinvent database (Table 7.4). Details on the use of Ecoinvent database to estimate GWP on alkali-activated binders can be found in Ouellet-Plamondon and Habert (2014). The exception being the negative GWP of hemp fibers that was taken from the recent work of Arrigoni et al., (2017) and that is explained by the biogenic CO2 uptake during hemp production. As to the carbon sequestration due to accelerated carbonation by using a furnace decomposition method it revealed a value of 102 kgCO2eq/m3. Fig. 7.9 shows the carbon footprint as well as the carbon sequestration. The results show that the carbon sequestration provided by the accelerated carbon curing has led to a carbon footprint of just 38 kgCO2eq/m3 for the mixtures without hemp fibers. Ouellet-Plamondon and Habert (2014) reported an embodied carbon of 227 kgCO2e/m3 for a mixture of hybrid cementebased concrete. Also Abdollahnejad et al. (2017) reported global warming potential in range of 178 and 250 kgCO2e/m3 for one-part geopolymer foam mortars composed of fly ash, Ordinary Portland cement, calcined kaolin, sodium hydroxide, and Ca(OH)2. Table 7.4 Global warming potential of each component of mixture (kgCO2eq). Recycled aggregates

MG

CH

Fly ash

Water

PC

SH

Hemp fiber

0.00401

0.00526

0.416

0.00526

0.000155

0.931

2.24

1.70 Arrigoni et al. (2017)

Sequestration

Emission

155

160

Carbon footprint

150

120

100

80

50

40

0

0

–80

–150

–120

–200

–160 M _8

M

80

80

FA

FA

_1

_1

0C

0C

H

H

_1

_1

0M

0M

G

G

_R

_R

AG

AG

C

C

_C

_C

C

C

_8

_8 C _C C AG _R G 0M _1 H 0C

_1 FA 80

_8

% _6

_4 M

_0 M _8 C _C C AG _R G 0M _1 H 0C _1 FA 80

%

–40

–100

%

–50

Carbon footprint (kgCO2eq/m3)

200

%

GHG emission (kgCO2eq/m3)

Carbon dioxide sequestration on mortars containing recycled aggregates

Figure 7.9 Greenhouse gas (GHG) emission and carbon footprint of different mixtures.

Those results confirm the very promising performance of the mixtures developed in this study. The use of hemp fibers leads to a sustained increase of carbon sequestration and a reduction of carbon footprint. Just using 6% hemp fibers leads to negative carbon dioxide footprint (5.3 kgCO2eq/m3). Mixtures with 8% hemp fiber content show a carbon footprint of 19.7 kgCO2eq/m3.

7.3.5

Cost analysis

The construction industry has a very strong focus on cost and the fact that authors conducting studies on construction materials almost never address this issue has been one of the causes that makes the scientific community to develop materials that are never used due to cost restrictions. Furthermore, in a context of carbon sequestration, it is especially important to simulate how a future carbon tax will help favor products that have a high carbon sequestration potential. The cost of mixtures was calculated regarding the listed prices of mixture’s ingredients in Table 7.5, which were provided by their suppliers. Moreover, two different scenarios were also assumed to consider a future carbon tax, including (1) 0.0347 Euro/kg for the carbon footprint as the first scenario (Stanford Report, 2015) and (2) 0.206 Euro/kg for considering the carbon

Table 7.5 Costs of the materials (Euro/kg). Recycled aggregates

MG

CH

Fly ash

Water

PC

SH

Hemp fiber

0.047

0.009

0.283

0.03

0.01

0.1

0.85

0.52

156

Start-Up Creation

footprint of mixtures as the second scenario (Moore and Diaz, 2015). Fig. 7.10 depicts the cost of the mixtures containing different masses of the hemp fibers. The mixture without hemp fibers has a cost of 160 euro/m3. The hemp fiber addition led to a slight increase in the cost of about 5% to a 4% fiber content. The results also show that use of a carbon tax has almost no influence at all in the cost of the mixtures with negative carbon footprint.

7.4

Conclusions

Compressive strength and flexural strength were reduced by adding the hemp fiber, so that the maximum degradation in mechanical properties was found about 50% in the compressive strength due to addition of 8% hemp shiv fiber. The results show that 6% hemp fiber is the maximum content that allows a mechanical performance sufficient for masonry applications. A high correlation was found between compressive and flexural strength. A negative correlation was found between compressive strength and hemp fiber content. Accelerated carbonation showed a carbon sequestration of 102 kgCO2eq/m3 and a carbon footprint of 38 kgCO2eq/m3 for fly ashebased alkaline mortars. Increasing the hemp fiber consistently increased the CO2 sequestration, so that the CO2 sequestration varied in the range of 131 to 160 kgCO2eq/m3. Addition of the hemp fiber continuously reduced the carbon footprint, so that the carbon footprint in the mixture reinforced with 8% hemp fiber is around 19.7 kgCO2eq/ m3. The results show that use of a carbon tax has almost no influence at all in the cost of the mixtures with negative carbon footprint. 200

Material cost

Scenario 1

Scenario 2

180

Cost (Euro/m3)

160 140 120 100 80 60 40

Figure 7.10 Cost of the mixtures.

%

%

_8

_6

M

M

_8

_8

C

C

_C

_C

C

C

AG

AG

_R

_R

G

G

0M

0M

_1

_1

H

H

C

C

10 FA _ 80

80

FA _

10

10 FA _ 80

80

FA _

10

C

C

H

H

_1

_1

0M

0M

G

G

_R

_R

AG

AG

C

C

_C

_C

C

C

_8

_8

M

M

_4

_0

%

%

20

Carbon dioxide sequestration on mortars containing recycled aggregates

157

Acknowledgments The authors would like to acknowledge the financial support of the Foundation for Science and Technology (FCT) in the frame of project IF/00706/2014-UM.2.15.

References Abdollahnejad, Z., Miraldo, S., Pacheco-Torgal, F., Barroso Aguiar, J., 2017. Cost-efficient onepart alkali-activated mortars with low global warming potential for floor heating systems applications”. European Journal of Environmental and Civil Engineering 21, 412e429. Agopyan, V., Savastano, H., John, V., Cincotto, M., 2005. Developments on vegetable fibree cement based materials in S~ao Paulo, Brazil: an overview. Cement and Concrete Composites 27, 527e536. American Coal Ash Association, 2016. https://www.acaa-usa.org/Publications/Production-UseReports. Arrigoni, A., Pelosato, R., Melia, P., Ruggieri, G., Sabbadini, S., Dotelli, G., 2017. Life cycle assessment of natural building materials: the role of carbonation, mixture components and transport in the environmental impacts of hempcrete blocks. Journal of Cleaner Production 149, 1051e1061. ASTM C109/C109M-16a, 2016. Standard Test Method for Compressive Strength of Hydraulic Cement Mortars (Using 2-in. or [50-mm] Cube Specimens). ASTM International, West Conshohocken, PA. www.astm.org. ASTM C618-15, 2015. Standard Specification for Coal Fly Ash and Raw or Calcined Natural Pozzolan for Use in Concrete. ASTM International, West Conshohocken, PA. www.astm. org. Balciunas, G., Pundien_e, I., Lekunait_e-Lukosiun_e, L., V_ejelis, S., Korjakins, A., 2015. Impact of hemp shives aggregate mineralization on physicalemechanical properties and structure of composite with cementitious binding material. Industrial Crops and Products 77, 724e734. Bendell, J., 2018. Deep adaptation: a map for navigating climate tragedy. In: Institute for Leadership and Sustainability (IFLAS) Occasional Papers, vol. 2. University of Cumbria, Ambleside, UK. http://insight.cumbria.ac.uk/id/eprint/4166/1/Bendell_DeepAdaptation. pdf. Bernal, S., 2014. Resistance to carbonation of alkali-activated materials. In: Pacheco-Torgal, F., Labrincha, J.A., Leonelli, C., Palomo, A., Chindaprasirt, P. (Eds.), Handbook of AlkaliActivated Cements, Mortars and Concretes. WoodHead Publishing Limited- Elsevier Science and Technology, Abington Hall, Cambridge, UK, pp. 319e332. Bernal, S., Rodríguez, E., Kirchheim, A., Provis, J., 2016. Management and valorisation of wastes through use in producing alkali-activated cement materials. Journal of Chemical Technology and Biotechnology. https://doi.org/10.1002/jctb.4927. Bertos, M.F., Simons, S.J.R., Hills, C.D., Carey, P.J., 2004. A review of accelerated carbonation technology in the treatment of cement-based materials and sequestration of CO2. Journal of Hazardous Materials 112 (3), 193e205. Diquélou, Y., Gourlay, E., Arnaud, L., Kurek, B., 2015. Impact of hemp shiv on cement setting and hardening: influence of the extracted components from the aggregates and study of the interfaces with the inorganic matrix. Cement and Concrete Composites 55, 112e121. El-Hassan, H., Shao, Y., 2015. Early carbonation curing of concrete masonry units with Portland limestone cement. Cement and Concrete Composites 62, 168e177.

158

Start-Up Creation

Europe, 2019. 100 Radical Innovation Breakthroughs for the Future. https://ec.europa.eu/info/ sites/info/files/research_and_innovation/knowledge_publications_tools_and_data/ documents/ec_rtd_radical-innovation-breakthrough_052019.pdf. Garcia-Lodeiro, I., Donatello, S., Fernandez-Jimenez, A., Palomo, A., 2016. Hydration of hybrid alkaline cement containing a very large proportion of fly ash: a descriptive model. Materials 9, 605. Gram, H., 1983. Durability of Natural Fibres in Concrete. Stockolm: Swedish Cement and Concrete Research Institute. Hansen, J., Sato, M., Kharecha, P., von Schuckmann, K., Beerling, D.J., Cao, J., Marcott, S., Masson-Delmotte, V., Prather, M.J., Rohling, E.J., Shakun, J., Smith, P., 2017. Young people’s burden: requirement of negative CO2 emissions. Earth System Dynamics Discussion arXiv preprint arXiv:1609.05878. Ivanov, V., Alexeev, V., Koldunov, N.V., Repina, I., Sandø, A.B., Smedsrud, L.H., Smirnov, A., 2016. Arctic Ocean heat impact on regional ice decay: a suggested positive feedback. Journal of Physical Oceanography 46 (5), 1437e1456. Jang, J.G., Kim, G.M., Kim, H.J., Lee, H.K., 2016. Review on recent advances in CO2 utilization and sequestration technologies in cement-based materials. Construction and Building Materials 127, 762e773. Li, Z., Wang, X., Wang, L., 2006. Properties of hemp fibre reinforced concrete composites. Composites part A: applied science and manufacturing 37 (3), 497e505. Moore, F., Diaz, D., 2015. Temperature impacts on economic growth warrant stringent mitigation policy. Nature Climate Change 5, 127e131. Mote, C., Dowling, J., Zhou, J., 2016. The power of an idea: the international impacts of the grand challenges for engineering. Engineering 2, 4e7. Onuaguluchi, O., Banthia, N., 2016. Plant-based natural fibre reinforced cement composites: a review. Cement and Concrete Composites 68, 96e108. Ouellet-Plamondon, C., Habert, G., 2014. Life cycle analysis (LCA) of alkali-activated cements and concretes. In: Pacheco-Torgal, F., Labrincha, J., Palomo, A., Leonelli, C., Chindaprasirt, P. (Eds.), Handbook of Alkali-Activated Cements, Mortars and Concretes. WoodHead Publishing-Elsevier, Cambridge, pp. 663e686. Pacheco-Torgal, F., Jalali, S., 2011. Cementitious building materials reinforced with vegetable fibres: a review. Construction and Building Materials 25 (2), 575e581. Pacheco-Torgal, F., Tam, V., Labrincha, J., Ding, Y., de Brito, J. (Eds.), 2013. Handbook of Recycled Concrete and Demolition Waste. Elsevier, Cambridge. Paya, J., Monzo, J., Borrachero, M.V., Tashima, M.M., 2014. Reuse of aluminosilicate industrial waste materials in the production of alkali-activated concrete binders. In: PachecoTorgal, F., Labrincha, J., Palomo, A., Leonelli, C., Chindaprasirt, P. (Eds.), Handbook of Alkali-Activated Cements, Mortars and Concretes. WoddHead Publishing, Cambridge, UK, pp. 487e518. Provis, J.L., 2014. Geopolymers and other alkali activated materials: why, how, and what ? Materials and Structures 47, 11e25.  Savija, B., Lukovic, M., 2016. Carbonation of cement paste: understanding, challenges, and opportunities. Construction and Building Materials 117, 285e301. Screen, J.A., Deser, C., 2019. Pacific Ocean variability influences the time of emergence of a seasonally ice-free Arctic ocean. Geophysical Research Letters 46 (4), 2222e2231. Sedan, D., Pagnoux, C., Smith, A., Chotard, T., 2008. Mechanical properties of hemp fibre reinforced cement: influence of the fibre/matrix interaction. Journal of the European Ceramic Society 28, 183e192.

Carbon dioxide sequestration on mortars containing recycled aggregates

159

Shea, A., Lawrence, M., Walker, P., 2012. Hygrothermal performance of an experimental hemplime building. Construction and Building Materials 36, 270e275. Stanford Report, 2015. Estimated Social Cost of Climate Change Not Accurate, Stanford Scientists Say. Retrieved from: http://news.stanford.edu/news/2015/january/emissions-socialcosts-011215.html. (Accessed 14 June 2017). Tabone, I., Robinson, A., Alvarez-Solas, J., Montoya, M., 2019. Submarine melt as a potential trigger of the North East Greenland ice stream margin retreat during marine isotope stage 3. The Cryosphere 13 (7), 1911e1923. Tonoli, G., Santos, S., Joaquim, A., Savastano, H., 2010. Effect of accelerated carbonation on cementitious roofing tiles reinforced with lignocellulosic fibre. Construction and Building Materials 24, 93e201. Turetsky, M.R., Abbott, B.W., Jones, M.C., Anthony, K.W., Olefeldt, D., Schuur, E.A., Koven, C., McGuire, A.D., Grosse, G., Kuhry, P., Hugelius, G., 2019. Permafrost Collapse is Accelerating Carbon Release. Valle-Zerme~no, R., Aubert, J.E., Laborel-Préneron, A., Formosa, J., Chimenos, J.M., 2016. Preliminary study of the mechanical and hygrothermal properties of hemp-magnesium phosphate cements. Construction and Building Materials 105, 62e68. Wadhams, P., 2017. A Farewell to Ice. Oxford University Press, Oxford. Watts, J., 2018. Arctic Warming: Scientists Alarmed by ’crazy’ Temperature Rises, vol. 27. The Guardian. Xu, Y., Ramanathan, V., Victor, D.G., 2018. Global Warming Will Happen Faster than We Think. Zhang, Z., Huisingh, D., 2017. Carbon dioxide storage schemes: technology, assessment and development. Journal of Cleaner Production 142, 1055e1064.

Carbon sequestration in microalgae photobioreactors building integrated

8

S.S. Oncel 1 , A. Kose 1 , D.S. Oncel 2 1 Ege University, Izmir, Turkiye; 2Dokuz Eylul University, Izmir, Turkiye

8.1

Introduction

Carbon, which is the critical building block of the biosphere, is always an important element for the earth. Considering its cycle through capture, accumulation, and release in the ecosystem, carbon has an equilibrium leading a balance distribution among hydrosphere, lithosphere, atmosphere, and biosphere. But this equilibrium was completely lost with the trigger of human interference especially with the start of industrial age due to increased use of natural sources and their devastating effects on the environment (Sayre, 2010; Yang et al., 2008). The greenhouse effect (Bezerra et al., 2013) is the phenomenon where some gasses such as carbon dioxide (CO2) in the atmosphere act as a shield blocking the release of infrared radiation causing a temperature increase on the planet, in other words global warming (Mondal et al., 2012).These gasses are called greenhouse gasses, and with the studies routed to years of observation and analysis, the increase in their levels is proved to be the main catalyst in the global warming and climate change (Gudipudi et al., 2016). The concentration of greenhouse gases, mainly CO2 compared with others such as methane, nitrous oxides, or fluorinated gasses has been rapidly increasing in the atmosphere due to different anthropogenic activities (Goli et al., 2016). Since the year 2000, the rise in CO2 levels is nearly 2 ppm per year, which is up to10 times faster than any rise in for the past 800,000 years (Global Warming of 1.5  C, IPCC, 2018). According to the US Environmental Protection Agency data considering 2017, the share of CO2 dominates with a ratio of 82% even if its greenhouse effect as per mass is much lower than the others (https://www.epa.gov/ghgemissions/ overview-greenhouse-gases; Yang et al., 2008). Today, the main driving force in the global energy production is the fossil fuels with a share of more than 80%. This fact is responsible for the high CO2 levels reaching 24 gigatons in each year (Goli et al., 2016; Sayre, 2010). Considering the anthropogenic CO2 emissions, the highest contributor is the combustion of fossil fuels with a share of 87%, followed by the deforestation and land use (9%) and conventional manufacturing processes (4%). Other than the anthropogenic causes, the emissions related to nature such as living things, sea, volcanoes, and soil are also in consideration even with a smaller impact for the global changes (Goli et al., 2016; Reich, 2009; Yang et al., 2008). Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00008-4 Copyright © 2020 Elsevier Ltd. All rights reserved.

162

Start-Up Creation

All these changes will have vital effects on the life of the earth, and this reality of survival forced the nations to focus on the global warming through sets of policy actions such as the Kyoto Protocol and the Paris Agreement. In the core of these actions; the intervention of global warming is related with the decrease in CO2 levels by efficient technologies considering capture and sequestration as well as the use of renewable and sustainable energy sources rather than the fossil fuels (BaenaMoreno et al., 2019; Singh and Dhar, 2019). For the efficient carbon capture and sequestration to prevent the built-up in atmosphere, different strategies are under investigation considering the rapid fixation in hydrosphere, lithosphere, and biosphere, by progressive natural sinking processes such as ocean fertilization, forestation, and mineral carbonation or by direct artificial CO2 sequestration, such as injection into geological formations and ocean (Mistry et al., 2019; Norhasyima and Mahlia, 2018; Yang et al., 2008).With a closer look at the forestation, the basic approach is the capture by the higher plants with the help of photosynthesis. But alternative microorganisms such as microalgae are also under consideration for this critical duty (Benemann, 1997; Huang et al., 2016; Ono and Cuello, 2006). Humanity and earth relation is always quite on the thin line of destruction especially after the industrialization era. Today, the massive cities rise as the fingerprints of mankind on the planet carrying all the advantages and disadvantages at the same time. Starting with the advantages, these concentration points gave comfort for various activities such as labor, services, and social interaction. But the increasing population meeting with the wrong and uncontrolled urbanization led to the disadvantages such as pollution, danger, and chaos (Gudipudi et al., 2016). Cities are the most vulnerable castles of humanity even if they seem to be majestic, considering the global warming. The critical risk in the global warming are the effects interrelated with the rising temperature such as changes in the seasons with a special emphasis on the intensity and pattern of rainfall causing floods or droughts, melting of global ice sheet resulting in the rising sea levels, and changing ocean streams causing extreme sea temperature oscillations. As per the projection from the Intergovernmental Panel on Climate Change, by the year 2100, the range of sea level increase will vary in 0.26e0.77 m for 1.5 C and 0.35e0.93 m for 2 C global temperature rise (Mondal et al., 2012; Yang et al., 2008; IPCC Annual Report, 2018). These problems will directly affect the future of humanity because high population concentrated in the cities will have a colossal shade on the dynamics of the civilization from a person to the whole environment. This reality forced the societies to focus on the cities for alternative solutions to prevent the urban effects on the sustainability and environment. With a special emphasis on global warming and greenhouse gasses such as CO2; the strategies cover various approaches such as green urban plans, sustainable city initiatives, rising environmental awareness, and technical solutions of enhancement from transport to energy consumption. From a pragmatic point of view to mimic the nature and project the advantages on the strategies considering the urban areas, a bio-based approach such as using biological CO2 capturing technologies can have a major chance as a game changer (Fig. 8.1).

Carbon sequestration in microalgae photobioreactors building integrated

Photosythesis

Indoor

163

Outdoor

Microalgae

Thermal comfort Waste water

Sound insulation

Recycle water

Environment friendship

Clean air

Energy saving

Sustainability

Sun protection

Polluted air (CO2, SOx, NOx)

PBR

Figure 8.1 Interaction between indoor and outdoor environments through the photobioreactorintegrated façade.

Limiting and preventing CO2 before it enters the atmosphere, microalgae can play a critical role with their ability to harvest light and inorganic carbon through photosynthesis (Benemann, 1997; Doucha et al., 2005; Zhao and Su, 2014). These microscopic organisms can capture and utilize CO2 and turn into its biomass, which is valuable for energy, food, agriculture, and feed industries (Koller et al., 2014). On the other hand, they can be adapted in different conditions from high to low temperatures, pH levels, and gas concentrations as well as open and closed production systems that can be constructed in the urban areas (Gudipudi et al., 2016; Rasmussen et al., 2008; Pulz, 2001; Tredici, 2004). The aim of this chapter is to concentrate on the CO2 and city relation with a special emphasis on the biosymbiotic contribution of microalgae from technical point of view to conceptual design.

8.2

Importance of carbon sequestration: reducing CO2 built-up

The earth faces a reality that atmospheric CO2 levels are exponentially increasing triggering the global warming. But one detail, the difference in the seasonal rates of emissions, can show how crucial is the touch of our society in this increase. Difference in the winter and summer CO2 levels in the northern hemisphere was significant having values of 7 ppm increase in winter and 5 ppm decrease in summer; in other words, even need of heating or illumination of the houses and longer in house stay during cold winter days has dramatic consequences on the climate (Smith et al., 2018).

164

Start-Up Creation

Today, most of the CO2 emission is a result of human activities such as fossil fuel combustion for electricity, heating, and transport or other industrial activities such as cement and lime factories (Chauvy et al., 2019). For the CO2 reduction, various strategies covering physics, chemistry, and biology were in consideration throughout the world (Wang et al., 2015). Each strategy has its own pros and cons, but the key issue about the success is quite challenging with all the issues comprising economy, management, effectiveness, sustainability, and environment friendship.

8.2.1

Why to focus on CO2 concentrations: global warming and cities

Since the Kyoto Protocol in 1997, an agreement on the importance of reducing greenhouse gasses with a target of 5.2% was promoted to capture global attention. To foster more support, a carbon credit system was announced in 2010 to give a price per unit of reduced emissions (Ho et al., 2011). Even if these attempts encourage the societies against the global problems, the complexity of the interrelations of our civilization with the nature considering fossil fuels, urbanization, labor and sustainability, it is not easy to solve every problem with a single strategy. But knowing and realizing the clogged part is the first thing to do to overcome the problems. Massive needs of the urban areas transfer all the sources especially energy and just leave a portion of 30% for the rural areas. Consuming more, cities attract more population, but this grows the dilemma of more problems (Gudipudi et al., 2016; Moran et al., 2018). As the urge for the development forces the civilization having a continuous demand on sources, effects of the concentration points such as cities on the CO2 emissions should not be underestimated. Population in the urban areas has an ascending increase especially after the industrialization era reaching a concentration of 50% (Wang et al., 2015). With well-accepted prospects, this population will pass 6 billion, in other words more than 67% of the global population, by the year 2050 depending on the estimation that 3 million dwellers adding annually (Makido et al., 2012). This dense flow of people rushing to the urban areas catalyzes the anthropogenic activities related to the CO2 emissions that peak the ratio to 75% of contribution (Baena-Moreno et al., 2019). Thus, different approaches focusing on environmental factors such as CO2 emissions should be highlighted for sustainable urbanization considering design, plan, and construction.

8.2.2

CO2 capturing technologies

Consensus about the effects of CO2 as the major contributor of global warming having serious impact on the planet motivates the scientific community to find strategies for decreasing the emissions (Yang et al., 2008), and the decrease is not just a vague definition: to see a global temperature increase lower than 2 C, compared with the base levels of preindustrial era, more than 50% of CO2 should be reduced by 2050 (Chauvy et al., 2019). Considering carbon capture and sequestration, these strategies that can be evaluated as the life vest against the risks of extreme changes with regard to

Carbon sequestration in microalgae photobioreactors building integrated

165

environment focus on two critical technology legs: storage and utilization (Chauvy et al., 2019; Mondal et al., 2012). Depending on the maturity of the technology, each approach has its own pros and cons that should be evaluated in detail with regard to different points such as efficiency, economy, sustainability, and availability and even form a societal projection (Chauvy et al., 2019; Wang et al., 2015; Yang et al., 2008). The carbon capture technology should be easily adaptable, gentle, environmentally friendly, labor, and cost-efficient. The touch of these technologies to nature, ecosystem, and urbanization should be kind and neat in the frame of well distribution of existing sources and development of new environmentally friendly technologies also on an ethical perspective. Today, different technologies of carbon capture and storage (CCS) were used depending on the physicochemical or biochemical reactions considering the main steps of capturing, transporting, and storing (Table 8.1). The carbon capture technologies can be a chain starting from capture to utilization, or it could be evaluated individually. The strategies can be classified under various titles such as absorption, adsorption, separation, distillation, mineralization, and concentration (Mondal et al., 2012; Sawayama et al., 1999). The key point is to manage CO2 easier in concentrated amounts with regard to transportation and storage. The captured CO2 can be stored by injecting in different reservoirs such as geological wells, oceans, saline formations, Table 8.1 Carbon capture and utilization. Carbon capture technologies • • • •

Precombustion capture Postcombustion capture Oxyfuel combustion capture Absorption • Amine-based absorption • Ammonium-based absorption • Dual alkali-based absorption • Adsorption • Molecular sieve adsorbents • Molecular basket adsorbents • Activated carbon-based adsorbents • Lithium-based adsorbents • Cryogenic process • Membrane technology (gas separation/absorption membranes) • Polymeric membranes • Inorganic membranes • Carbon membranes • Alumina membranes • Silica membranes • Zeolite membranes • Mixed matrix hybrid membranes • Facilitated transport membranes Continued

166

Start-Up Creation

Table 8.1 Continued Carbon capture technologies

Novel capture technologies • Dual-alkali absorption • Integrated gasification combined cycle • Chemical looping combustion

Carbon fixation • • • • • •

Forestation Ocean fertilization Mineral carbonization Photosynthesis In situ CO2 capture Hydrate-based separation

Captured carbon utilization CO2 utilization as solvent

Chemicals produced from CO2

Fuels produced from CO2

• • • • •

• Organic carbon carboxylation • Carbonic amides • Carbonates • Isocyanates • Amides • Acyclic carbonates • Cyclic carbonates • Polymers • Mineral carbonation

• CH4 • Gas hydrates • Microalgal biofuels • Biogas • Bioethanol • Biohydrogen • Biodiesel

Hydroformylation Hydrogenation Oxidation Biocatalysis Polymer synthesis

Based on Baena-Moreno, F.M., Rodríguez-Galan, M., Vega, F., Alonso-Fari~nas, B., Vilches Arenas, L.F., Navarrete, B., 2019. Carbon capture and utilization technologies: a literature review and recent advances. Energy Sources, Part A Recovery, Utiliztion Environmental Effects 41, 1403e1433. https://doi.org/10.1080/15567036.2018.1548518; Mondal, M.K., Balsora, H.K., Varshney, P., 2012. Progress and trends in CO2 capture/separation technologies: a review. Energy 46, 431e441. https://doi.org/10.1016/j.energy.2012.08.006; Yang, H., Xu, Z., Fan, M., Gupta, R., Slimane, R.B., Bland, A.E., Wright, I., 2008. Progress in carbon dioxide separation and capture: a review. Journal of Environmental Sciences 20, 14e27. https://doi.org/10.1016/S1001-0742(08)60002-9.

or aquifers. These strategies are quite expensive and not easy to operate, having critical risks of leakage. Another strategy which may be more environmental friendly approach that covers the biochemical route, in other words natural reservoirs such as plants and algae (Anjos et al., 2013; Benemann, 1997; Hulatt and Thomas, 2011; Norhasyima and Mahlia, 2018; Yang et al., 2008). On the other hand, physiochemical paths include membranes, cryogenic vessels, columns, scrubbers, and compressors, which are the main systems conventionally utilized (Goli et al., 2016; Mondal et al., 2012). Utilization strategies can be termed as the following step of storage. The aim is to use the captured and stored CO2 with an efficient approach of valorization. This idea comprises the production of valuable and useful products that can be used in various areas of interest. Main interest of CO2-based products covers the chemical and biological products that have conventional potential. With regard to chemicals, stored CO2

Carbon sequestration in microalgae photobioreactors building integrated

167

can be used as solvent in hydroformylation, hydrogenation, polymer synthesis, and biocatalytic processes or used to produce carbamic acid, polymers, cyclic carbonates, or gas hydrates (Singh and Dhar, 2019). With a specific emphasis on the biological utilization, having CO2 as the key issue, in photosynthesis, various products that are valuable for the sectors such as energy, pharmacy, or cosmetics can be produced by using microalgae or plants. Especially, microalgae can be a valuable interface for biofuel (hydrogen, ethanol, methane, biodiesel, biogas) and biochemical (pigments, biomass, fertilizer, antioxidants, drugs) production with a conventional interest (Baena-Moreno et al., 2019; Oncel and Sabankay, 2012; Smith et al., 2018; Oncel, 2013, 2015; Oncel et al., 2015). Utilization of CO2 in a sustainable way is not a novel idea; it has been in minds, but due to the complexities, it has been only applied in a few areas for industrial purposes. However, the theoretical utilization of CO2 as an alternative carbon feedstock offers new opportunities for the development of novel fuels, materials, and chemicals to replace or at least decrease the utilization of fossil fuel sources (Chauvy et al., 2019; Mondal et al., 2012). CO2 is produced by steel, cement, chemical industries, and power plants and can be converted into valuable products via biological, electrochemical, photocatalytic, and thermochemical conversion (Benemann, 1997; Chauvy et al., 2019; Sayre, 2010). From these different routes, the one/ones serving better in terms of performance and added value should be developed for long-term applications (Chauvy et al., 2019; Zhao and Su, 2014). To decrease the global temperature, that is, to rise less than 2 C, novel CO2 sequestration technologies should be adapted immediately to at least decrease the emission 50% till 2050. Considering the massive CO2 production, this is a huge demand, and long-term survival programs should be adapted and inserted into the daily lives of the population and should not keep it only in industrial level. The adaptation of CO2 sequestration is slower due to the dependence on industries to fossil fuels. A framework of future projections will help to incorporate CO2 capture and sequestration which will add value to a dangerous waste for global consensus. As beginning, CCS is a good solution using different solvents, such as monoethanolamide (MEA) or piperazine (PZ) (Baena-Moreno et al., 2019), with higher capture rates, but technology is not sustainable and has economic limitations derived from energy requirement of the mentioned solvents. Besides capturing technologies requires larger storage areas, which will eventually become a limiting factor if CO2 is not utilized in the circular economy model. Carbon capture technology is applicable where high masses of CO2 are produced in industries such as power plants, steel, and cement. CCS technology deals with CO2 capture, transport, and storage to frame a holistic approach. The captured CO2 should be stored wisely or transferred in the utilization or storage area. CO2 capture from exhausts and flue gasses is done by physical, chemical absorption, membrane separation, and cryogenic distillation techniques (Mondal et al., 2012). CO2 separation and capture processes can be divided into several scenarios: postcombustion processes for a tradition coal-fired power plant, precombustion processes for gasification or reforming, and oxyfuel processes. Oxyfuel combustion is sometimes referred to as oxyfiring or oxycombustion. Newly emerged technologies, such as chemical looping

168

Start-Up Creation

combustion (CLC), significantly reduce the complexity of separating CO2 from a gas stream (Mondal et al., 2012; Yang et al., 2008). First step of CO2 separation is cost required and energy intensive that, capturing strategies require the development of novel techniques aiming to decrease energy input. Concentrated CO2 is transported via vehicles or pipelines. Finally, transported CO2 is stored in reservoirs as geological storage areas, and CO2 is sometimes directly injected into the ocean, saline formations, aquifers, and depleted oil/gas wells (Smith et al., 2018; Yang et al., 2008). It should be mentioned that; capturing and transporting CO2 could be expensive and storage could have some leakage problems, which may cause serious environmental health risks. On the other hand, CO2 can be a valuable source on biological perspective. As main substrate of photosynthesis, CO2 can be utilized in forestation areas and could be fed into aquatic environments as natural fertilizers for the cultivation of phytoplankton, microalgae, and aquatic plants (Benemann, 1997; Mistry et al., 2019; Mondal et al., 2012; Yang et al., 2008). But whatever the route chosen for the evaluation of CO2, all the paths are designed to contribute to fight with global warming. Choosing the technology could be done wisely, considering economical, environmental, and ethical facts. Decreasing the CO2 emissions could contribute as decrease in the environmental risks and a rapid development on the CO2 utilization for industries could be adapted. CO2 is a valuable gas in an economical point of view. It could be utilized as an extraction solvent in many food and chemical industries as well as water treatment facilities and dry cleaning industry; thus, decrease in the toxic or dangerous solvents could be observed, which adds another impact on environmental protection. Microalgae are one of the few technologies combining both CO2 capture and utilization. Algae could be thought as living catalysts on the sequestration of CO2 for more value-added products conversion. The built-up of a microalgae process area near the power plant could reduce the transportation and storage costs. The harvested CO2 could be utilized by microalgae, and CO2 is easily converted into biomass. The microalgal biomass could be converted into energies such as bioethanol, biogas, and biodiesel. Microalgae utilization is also advantageous for the elimination of polluting chemicals such as NOx and SOx species. However, the adoption of this technology is limited by the choice of microalgae species, requirement of large production areas in open pond systems, the sensitivity of microalgae to rapid changes in the climate and mass amount of water requirement for microalgae cultivation, and, the last but not the least, building efficient downstream processing for yield efficient biomass harvesting (Koller et al., 2014; Sayre, 2010). Thus, utilization of microalgae is also an expensive technology as its current state, but this does not change the fact that microalgae hold a great potential for mass utilization of CO2 to add value on circular economy model. If the limitations on the solar energy conversion into biomass efficiency are increased, cost-effective downstream processes could be developed, strain engineering to increase higher-level CO2 utilization and biomass production could be achieved, and microalgal productions could become a low-cost technology for CO2 utilization. In any case, it is valuable to invest on microalgae, considering benefits on the near future since microalgal technologies started to be integrated into even building facades (Benemann, 1997).

Carbon sequestration in microalgae photobioreactors building integrated

8.3

169

CO2 capture by microalgae

Biological CO2 fixation is based on the technology development using photosynthetic organisms such as terrestrial plants, photosynthetic bacteria, and algae (Koller et al., 2014; Singh and Dhar, 2019). Due to 3%e6% contribution of plants for CO2 fixation and requirement of long times to grow, microalgae and cyanobacteria gained attention. These photosynthetic organisms could grow much faster than plants and could achieve almost 50 times higher CO2 fixation (Fig. 8.2). Microalgae could be valuable for several industries, and these industries could work together to increase sustainability and environmental impact such as wastewater and heavy metal removal and biobased energy production with the combination of CO2 fixation (Douskova et al., 2009; Ho et al., 2011; Wang et al., 2008). Microalgae are unicellular or simple multicellular and filamentous living forms in aquatic environments, which could efficiently fix CO2 (Hou et al., 2019; Singh and Dhar, 2019) directly from atmosphere, flue gasses, and soluble carbonate salts. The term “microalgae” is generally used for both prokaryotic blue green algae (cyanobacteria) and eukaryotic microalgae including green algae, red algae, and diatoms. Microalgae are being sought as alluring biofactories for the sequestration of CO2 and simultaneous production of renewable biofuels, food, animal and aquaculture feed products, and other value-added products such as cosmetics, nutraceuticals, pharmaceuticals, biofertilizers, and bioactive substances (Koller et al., 2014; Sepulveda et al., 2019; Skulberg, 2000). More than 3800 ZJ of solar energy is absorbed by earth annually. 0.05% of the solar energy is captured by biomass using photosynthesis, which uses CO2 as carbon sources (Sayre, 2010). Light is utilized for the formation of carbohydrates, proteins, and lipids as major portion of the organisms via chlorophyll-containing tissue parts. Oxygen and energy-rich compounds are produced via photosynthesis. Carbohydrates are the CO2

2-Phosphoglycolate

Photorespiration CO2

O2

Sun CO2

ADP

Calvin benson cycle

NADP+

Photosythesis Light independent stage

O2

NADPH ATP

3-Phosphoglycerate

Light dependent stage

Glucose

O2 RuBisCo

Water

Figure 8.2 Biosymbiosis loop based on the reactions of photosythesis.

170

Start-Up Creation

major portion of produced organic compounds (6CO2 þ 12H2O þ light þ green plant ¼ C6H12O6 þ 6O2 þ 6H2O) (Giordano et al., 2005). Glucose is then converted into starch, cellulose, pigments, lipids, amino acids, proteins, nucleic acids, and some other specie-specific organic compounds (Carroll et al., 2018; Sandmann et al., 2016; Sepulveda et al., 2019). Light energy breaks the CeO bonds, and novel bonds are formed to obtain various biological forms. Water splitting, where the bonds in CO2 are broken, is an energy requiring process and directly affects the yield of photosynthesis. The light intensity, CO2 content, and temperature are three critical parameters that define the success of photosynthesis, which is more complex than it is thought. The maximum glucose production efficiency is 31% and could change depending on the quality of the external and intrinsic factors (Hamed and Kl€ock, 2014). CO2 sequestration by means of microalgae could elevate the sustainable bioproducts industry. Algal biofuels such as biodiesel, biogas, biochar, biohydrogen, and bioethanol have been major attention point for biomass-based renewables. On the other hand, genetically engineered species to favor for fine chemicals and highvalue compounds for cosmetics, bioplastics, pharmaceuticals, and biomaterials are also growing attention. The impact of fixing exhaust gas to microalgal biomass is one of the most promising strategies with less environmental risks and high impact on ecosystem. Even oxygen generated could be an input of diverse industries that “no waste policy” for algal biotechnology is certainly applicable with more R&D efforts (Smith et al., 2018). Benemann proposed several arguments for CO2 mitigation on microalgae, as it could be listed directly from his point of view: 1. The use and recycling of CO2 is inherently preferable to the disposal options. 2. Direct CO2 mitigation processes are inherently preferable to indirect ones. 3. As fossil fuel prices increase, microalgae CO2 mitigation costs decrease, unlike other methods for CO2 capture and sequestration. 4. Microalgae systems’ R&D is essentially genericdeasily translated to new sites. 5. Microalgae R&D can have “spin-offs” from wastewater treatment to chemicals. 6. Microalgae R&D can be easily extrapolated from small scales to larger systems. 7. Microalgae R&D is inherently faster than other biomass systems, due to the very rapid growth rates of these microscopic plants (Benemann, 1997).

8.3.1

Microalgae as a potential tool for CO2 capture

Microalgae through the evolution of O2 in atmosphere developed carbon concentration mechanisms (CCMs) as a group of enzymes and transporter proteins, which helps the capturing and conversion of CO2 into carbonated forms even at very low CO2 concentration (Giordano et al., 2005). Due to the adaptation to even live in extreme conditions, microalgae are versatile and dynamic group of organisms to sequester valuable amounts of CO2 (Mistry et al., 2019). They could grow in nonarable lands and vertical environments and could survive extreme conditions such as high salt, high irradiation, alkaline water, moist soils, and even wastewaters containing harsh heavy metals (Bleakley and Hayes, 2017; Huntley and Redalje, 2007; Ma et al., 2017).

Carbon sequestration in microalgae photobioreactors building integrated

171

These environmental conditions could not be tolerated by land crops. Microalgae are also beneficial for the utilization organic wastes high in N and P; pollutants from agriculture, sewage, and manure; industrial wastewater streams; and waste gasses rich in NOx and SOx species (Doucha et al., 2005; Kadam, 2001; Maeda et al., 1995). Thus, implementation of microalgae for CO2 sequestration is an advantageous approach to combine most of the wastes into sources (Singh and Dhar, 2019). Their toleration to these conditions makes them a tremendous and attractive source for most of the industries (Table 8.2). The catalytic conversion of CO2 is done by a serial reaction named CalvineBenson Cycle (Fig. 8.2) by the activation of RuBisCO enzyme converting simple CO2 into complex organic molecules (Kaplan and Reinhold, 1999). The CO2 sequestration of microalgae is estimated as 1.23 kg CO2 fixed per 1 kg microalgal biomass (Assis et al., 2019). The atmospheric CO2 concentration is 0.03e0.06 (v/v), whereas the exhaust gasses of power plants could contain 6%e15% of CO2, which is 250-fold higher than atmospheric levels. The biological CO2 fixation by algae is dependent on the taxonomic characteristics of microalgae species, the design and efficiency of microalgae production system, light utilization rate of the microalgae, and other related environmental factors such as temperature and light provided. The wise choice of the microalgae species could define the quality and quantity of the CO2 sequestration. The photosynthetic efficiency is changeable in between species, and the response of the microalgae toward production system is also critical. The choice of ideal microalgae species is dependent on the high survival rates and higher tolerance to increasing CO2 levels along with the environmental stressors including temperature, pH, nutrient availability/limitation, pollutants, and toxic compounds. Until now, Scenedesmus obliquus, Botryococcus braunii, Chlorella vulgaris, and Nannochloropsis oculata are used as good model organisms especially when outdoor cultivation is considered (Douskova et al., 2009; Mistry et al., 2019; Sawayama et al., 1999; Sepulveda et al., 2019; Sydney et al., 2010). Increasing number of research studies showed the positive impact of growing microalgae under high concentrations of Ci in the form of pure gaseous CO2, real or simulated flue gas, or soluble carbonate (bicarbonate), reporting increased carbon biofixation and biomass productivity (Anjos et al., 2013; Kaplan and Reinhold, 1999; Mendoza et al., 2013; Ono and Cuello, 2003). Cyanobacteria (Fig. 8.3) and microalgae (Fig. 8.4) can fix carbon dioxide from different sources including the atmosphere and industrial exhaust gases and in the form of soluble carbonates using special CO2 transport metabolism. The typical CO2 concentration flue gasses are much higher than atmospheric level. Microalgae could tolerate 10% of CO2 highest, and level above this becomes toxic and decreases cell survival rates. Thus, the efficient utilization of exhaust CO2 by microalgae becomes a real discussion to adapt microalgae for this process. The tolerance of microalgae to increasing CO2 levels could be achieved by the manipulation of pH and temperature. Even though the increasing level promotes cell growth, later it becomes toxic to cells. The proposed strategy is to screen for novel species with high CO2 utilization and strain engineering; metabolic regeneration could be a novel technique using in silico and molecular genetics tools (Ajjawi et al., 2017; Carroll et al., 2018; Li et al., 2018; Shabestary et al., 2018). Thus, gradually, species

Microalgae

PBRs

Chlorella sp. NCTU-2 (marine)

• Bubble column-type PBR • Centric-tube PBR • Porous centric-tube PBR

Culture condition • Batch cultures • 4 L working volume • Bottomdsparged gas dispersion • Light intensity: 300 mmolm2 s1 • Light source: continuous cool while fluorescent lamps • 26  1 C, • Artificial seawater Bubble column: • Glass • 100 mm diameter • 650 mm height Inner column:

172

Table 8.2 CO2 sequestration from several microalgae species. CO2

Key findings

Ref

• Initial biomass conc: 1 g/L • 5% CO2 aeration rate of 1.0 L/min (i.e., 0.25 vvm) • Premixed gas from cylinder

• Maximum CO2 removal efficiency of Chlorella sp. NCTU-2 culture was 63% when the biomass was maintained at 5.15 g/ L concentration and 0.125 vvm aeration (10% CO2 in the aeration gas) in the porous centric-tube PBR Specific growth rates (m)

Chiu et al. (2009)

• Bubble column, 0.180 day1 • Centric-tube, 0.226 day1 • Porous centric-tube, 0.252 day1

• 45 mm diameter • Acrylics • 600 mm height Start-Up Creation

• Transparent glass tubes (1.0 m length, 1.0 cm internal diameter, and 0.5 cm wall thickness) • Inclination of 2% (1.15 degrees) • PVC tubes were used to connect the glass one • Illuminated by 20 W fluorescent lamps

• Light intensities (60 mmol m2s1 I  240 mmol m2 s1). • Schl€osser medium • Fed-batch • The total volume: 3.5  103 cm3 • Illuminated volume: 2.12  103 cm3 • 29 C • Steady state • Constant pH

• Pure CO2 of analytical grade (99.9%) was obtained from a cylinder cultivations were performed at an initial biomass concentration of 400 kg m3 • pH set and maintained at 9.5  0.2 by addition of pure • CO2 from a cylinder or CO2 from continuous alcoholic fermentation

• The type of carbon source (pure CO2 or CO2 from fermentation) did not show any appreciable influence on the main cultivation parameters Fed-batch cultivation 120 mmol mL2sL1

Bezerra et al. (2013)

• Maximum cell concentration: 2960  35 gm3 • Cell productivity: 425  5.9 gm3 day1

Continued

Carbon sequestration in microalgae photobioreactors building integrated

Arthrospira platensis UTEX 1926

173

174

Table 8.2 Continued Microalgae

PBRs

Chlamydomonas reinhardtii CC1690

• Short light path (SLP) PBR • 3.4 L working volume • Annular gap width 12 mm • Illuminated area 0.24 m2

Culture condition • Continuous light by 60 tungsten halogen Lamps • Rotating inner cylinder at 70 rmm in turbidostat cultures • An average incoming light intensity (PFDin) of 600 mmol m2 s1 • 25 C • Sueoka high salts • (HS) medium, enriched for magnesium and calcium • pH 6.7

CO2

Key findings

Ref

Air with 2% CO2

• Elevated O2 concentrations and the corresponding increase in the ratio of O2:CO2 common in PBRs led to a reduction of growth and biomass yield on light with 20%e30% • Ratio of the oxygenase reaction to the carboxylase reaction was 16.6% and 20.5% for air with 2% CO2 and 1% CO2 • Photorespiration has a significant impact on biomass yield

Kliphuis et al. (2011)

Start-Up Creation

Bubble column • 2000 mm high • 32 mm diameter

• 350  10 lmol photons PAR m2 s1 • One-sided cool white tubes • 26  0.5 C • Batch cycle Superficial gas velocities (Usg) • 0.001 ms1 • 0.002 ms1 • 0.005 ms1

The bioreactors contained 1.4 L fluid and gas was supplied preCO2 concentrations • Combined cycle gas turbine plant flue gas (4%) • Coal-fired plant flue gas (12%). • Replicate air (0.04%) Premixed mixed (CO2 þ 20% oxygen þ nitrogen balance, BOC special products, UK)

Hulatt and Thomas (2011)

175

• The maximum dry weights (SFG treatments) ranged from 2.7 to 3.6 g L1, each obtained using C. vulgaris in 4% CO2 • In the 4% and 12% treatments for both C. vulgaris and D. tertiolecta, the amount of CO2 was incorporated into the cellular material varied similarly to the dry weight measurements • The maximum rate at which carbon was incorporated into biomass was achieved by D. tertiolecta cultivated in 12% CO2 at 0.005 ms1 CO2, measuring 1.51  0.19 g CO2 L1 d1 • The corresponding CO2 removal efficiency was 2.1  0.3% • For C. vulgaris, maximum CO2 uptake occurred in 12% CO2 at 0.005 ms1 and measured 1.12  0.15 g CO2 L1 d1

Carbon sequestration in microalgae photobioreactors building integrated

Chlorella vulgaris, Dunaliella tertiolecta

Continued

Table 8.2 Continued PBRs

Scenedesmus obliquus SJTU-3 Chlorella pyrenoidosa SJTU-2

• 1 L Erlenmeyer flask (20 cm length, 10 cm diameter) • 800 mL working volume

Culture condition • Batch 14 days modified • BG11 medium • 25  1 C • 180 mol m2 s1 light intensity • Initial inoculum concentration: 0.05 g L1 • Initial pH 7.0

Key findings

Ref

Cultivated with • 0.03% CO2 • 5% CO2 • 10% CO2 • 20% CO2 • 30% CO2 • 50% CO2

• The maximum biomass concentration and CO2 biofixation rate were 1.84 and 0.288 g L1 d1 for S. obliquus SJTU-3 and 1.55 and 0.260 g L1 d1 for C. pyrenoidosa SJTU-2 • The main fatty acid compositions were C16eC18 (>94%) • High CO2 levels (30%e50%) were favorable for the accumulation of total lipids and polyunsaturated fatty acids • Two microalgae be appropriate for mitigating CO2 in the flue gases and biodiesel production • Two microalgae could grow at 50% CO2 (>0.69 g L1) and grew well (>1.22 g L1) under CO2 concentrations ranging from 5% to 20% • Best growth potential at 10%

Tang et al. (2011)

Start-Up Creation

CO2

176

Microalgae

• Baffled Erlenmeyer flasks • 250 mL working volume

• Cultivated in oil sands process water (OSPW) • 21  0.5 C • 150 rpm • 8 days

Various concentrations of CO2 fed from septum DuoCAPs

• The optimal CO2 concentration: 35% • Phosphate concentration: 29 mM • Light intensity: 70 mmolphotons m2s1 • Maximum CO2 uptake: 65.03 mg/L/day • Maximum specific growth rate: 0.31/day obtained at 22% CO2

Kasiri et al., (2015)

C. vulgaris P12

• 110 mL glass bubble column PBRs • 90 mL working volume

• Photoautotrophic • Aeration rates (ranging from 0.1 to 0.7 vvm) • Illumination by four fluorescent lamps (Sylvania Standard F18 W) • One sided light supply • Irradiance of 70 mmol m2 s1 • 30 C • 7 days

CO2 concentrations (ranging from 2% to 10%)

The maximum CO2 (2.22 g L1 d1) was obtained by using 6.5% CO2 and 0.5 vvm

Anjos et al.(2013)

Carbon sequestration in microalgae photobioreactors building integrated

Chlorella kessleri

Continued

177

Table 8.2 Continued PBRs

Arthrospira (Spirulina) platensis

Glass doublejacked column

Culture condition

Key findings

Ref

CO2 concentrations 0%, 0.5%, 1%, and 2% (v/v) When necessary, sterile air or air/CO2 mixture was introduced 4 mL s1

• Addition of 1% of CO2 improved the productivity by near 60% • Significant growth was observed whatever the range of culture conditions tested (salinity varying between 13 and 35 g L1, CO2 addition varying between 0% and 2%, and light intensity varying between 600 and 1200 lx) • Optimal conditions for productivity and protein content were obtained with a salinity of 13 g L 1 and a percentage of CO2 of 1%

Ravelonandro et al. (2011)

Start-Up Creation

• Mixing by bubbling • Sterile air at 25 mL min1 • Continuous illumination • White fluorescent tubes • Average intensity of 600 lx • Zarrouk medium • Medium salinities (13, 20, 25,30, 35 g L1) • 2.5 L working volume • 30  1 C • Continuous illumination from two sides • Vertical white fluorescent tubes (18 W) • Various light intensities • Green polyethylene covering • The initial pH: 9.5  0.1 • Batch inoculation density: 500 mg/L

CO2

178

Microalgae

• Bubblecolumn PBR • 300 mL

• Aeration 0.2 v/v/ min • Constant pH at 8.0 • Arnon medium • 25 C • Illuminated by fluorescent lamps • Circadian solar cycle (0e1200 mE m2$s1) _ • Irradiance for light period (780 mE m2$s1) • 24-h illumination (390 mE m2$s1) • Batch cultivation

10% CO2

• S. almeriensis, N. oleoabundans, and bloom from the River Seine were the most productive, above 1.0 g L1$ day1 • Strains mainly accumulate carbohydrates in the stationary phase, over 60% d.wt. • N. oleoabundans and C. vulgaris accumulate lipids above 20% d.wt • Maximum biomass productivity 1.3 g L1$day1, equivalent to 2.6 g L1$day1 of CO2 capture capacity • Biomass concentration of 0.6 g L1 • Average irradiance of 160 mE m2$s1

Sepulveda et al. (2019)

Carbon sequestration in microalgae photobioreactors building integrated

• Scenedesmus almeriensis • Neochloris oleoabundans • Anabaena sp. CCAP 1403/13 • Spirulina platensis • Nostoc commune CCAP 1453/33 • Calothrix scytonemicola CCAP 1410/ 12 • Scenedesmus dimorphis • C. vulgaris CCAP 211/11D • Monoraphidium griffithii CCAP 202/ 11D • Synechococcus sp. CCAP 1479/9

Continued

179

Table 8.2 Continued PBRs

C. vulgaris CCTCCM209256

1.25-L bubblecolumn PBR • 25.0 cm in height, • 8.0 cm in diameter • 1 L working volume

11L BioFlo Fermentor • 8 L working volume • Automatic pH control • Ring sparger

Key findings

Ref

• 1:10 (v/v) inoculation ratio • Initial biomass concentration of 0.10 g L1 • 25 C • 10 fluorescent lamps • Continuous illumination • 300 mmol m2 s1 • 12/12 h light/dark cycle • Gas sparger at the bottom • Instant ocean sea salt medium

In CO2 concentration experiments, the bioreactor was aerated at a rate of 1.0 vvm

• A CO2 concentration of 5% was found to be most suitable for microalgal growth • Microalga grew best at a CO2 aeration rate of 0.5 vvm • Biomass concentration: 3.83 g L1 • Lipid productivity: 157 mg L1 d1 Cultivation time

Zheng et al. (2012)

• Illumination by eight cool white 32W fluorescent lamps (providing 3500 lux) • 12:12 h (light/ dark) photoperiod • Temperature control by a water jacket • 15 days batch

Air enriched with 5% CO2

• 7 days for 0.03%, 1%, and 5% CO2 • 6 days for 10% CO2 • 4 days for 15% CO2 • Chlorophyll-a inhibited with 15% CO2 CO2 fixation rate (mg LL1 day1), • B. braunii (496.98) >S. platensis (218.61) > D. tertiolecta (272.4) > C. vulgaris (251.64) • Carbon dioxide fixated was mainly used for microalgal biomass production

Sydney et al. (2010)

Start-Up Creation

• D. tertiolecta SAD13.86 • C. vulgaris LEB104 • Spirulina platensis LEB-52 • Botryococcus braunii SAG-30.81.

CO2

Culture condition

180

Microalgae

Carbon sequestration in microalgae photobioreactors building integrated

181

ATP

HCO3–

HCO3– HCO3–

HCO3– Na

+

HCO3–

HCO3– NADPH

HCO3–

CO2 NADPH

HCO3–

CO2

HCO3– Carbonic anhydrase

CO2

CO2

RuBisCo

Carboxysome

PGA

Thylakoid membrane Plasma membrane

Figure 8.3 Basic concept of the CO2 concentration mechanism in prokaryotic microalgae (cyanobacteria) (Giordano et al., 2005; Kaplan and Reinhold, 1999; Mistry et al., 2019).

CO2 / HO3–

CO2

HO3–

Cytosol

CO2 CO2 / HO3– CO2 CAext

HO3–

CO2 CO2 HO3–

PEPCK

C4 PEPC

Photosythetic C reduction cycle

Decarboxylase (PEPCK or ME)

Triose phosphate C3

Chloroplast Figure 8.4 Basic concept of the CO2 concentration mechanism in eukaryotic algae (Giordano et al., 2005; Kaplan and Reinhold, 1999; Mistry et al., 2019).

182

Start-Up Creation

living in 80% of CO2 could be achieved (Huang et al., 2016). The activation of RuBisCO is critical. The enzyme has a dual role and it acts also as oxygenase depending on the CO2 levels in the environment (Kairupan et al., 2019). The low affinity of RUBisCO results in the less CO2 fixation (Giordano et al., 2005; Kaplan and Reinhold, 1999). Cells develop CCMs to harvest and increase intracellular levels of CO2 to increase CO2 fixation (Kaplan and Reinhold, 1999). Transportation of CO2 through CCM channels increases the photosynthetic efficiency and decreases the photorespiration (Kliphuis et al., 2011). Dissolved inorganic carbon (DIC) exists in several forms such as CO2, HCO3, CO3, and H2CO3. Microalgae could use DIC in several ways via active transport, cation exchange, and specialized system named as carbonic anhydrases (CAs), which could be found in periplasmic space (pCA), cytosol (cyPA), and chloroplast (chCA) (Giordano et al., 2005). Microalgae species could choose various ways to transport or accumulate intracellular CO2 levels. pCA balances HCO3 and CO2 levels; meanwhile, cyPA is responsible for the acceleration of CO2 and HCO3 transportation (Zhao and Su, 2014). When CAs increase the concentration of DIC around RuBisCO, catalytic conversion of carbon to organic molecules also accelerates. mRNA expression studies show that CAs increase when a shift from high CO2 to low CO2 levels occurred to harvest more DIC from the environment. At pHs between 6.4 and 10.3, the dominant (>50%) form of CO2 in water is bicarbonate. The average concentration of CO2 (0.014 mmol/L; 15 C) is lower than HCO3 (2.1 mmol/L) and CO3 (0.2 mmol/L) in natural seawater. In these circumstances, algae face with a deficiency to pump DIC into the cells. In some very low CO2 concentration, cells produce extracellular CAs to harvest DIC as much as they can. But in the case of flue gasses where CO2 concentration is denser, a gradual adaptation is required. Since increase in the CO2 concentration results as acidic environments, the tolerance of the species could change. Extreme environment species could balance the pH; however, more fastidious microalgae could eventually die through CO2 toxicity (Huang et al., 2016). Since the atmospheric oxygen levels increased in the millions of years, the much more work for carbon sequestration is based on the total activity of CCMs for both cyanobacteria and microalgae (Giordano et al., 2005; Zhao and Su, 2014). The CCM compartments use active transport, which is an energy-required process for harvesting the Ci species (Mistry et al., 2019). The photosynthesis yield is below 10% of solar energy; thus, the yield efficiency should be increased for a more reliable production (Sydney et al., 2010). One of the proposed ideas is to feed CO2 into lakes, open seas, and oceans to increase the DIC concentration, so phytoplankton, cyanobacteria, and microalgae as well as other aquatic plants could use exhaust CO2 for biomass production, and Ci deficiency in deep waters could be solved (Ho et al., 2011). However, this idea faces with some environmental concerns such as losing the control of the system and eventually harming the ecosystem balance, which will consecutively create environmental hazard and ethical issues. The other concern is that biomass energy is not utilized when open sea systems are adapted. In a more controlled way, production of microalgae in open or closed production system could be more beneficial to evaluate fine chemicals and food supplements and reviewing the biofuel capacity of microalgae. This technology could provide control over the systems, and a circular economy model could be adapted for future achievements.

Carbon sequestration in microalgae photobioreactors building integrated

8.3.2

183

Microalgae production systems: photobioreactors

Microalgae habitats the earth over billions of years; however, their adaptation to biotechnology comes late after the 1950s when food supply becomes a critical issue. The microalgae are proposed to be a high protein source, and other compounds are considered as food additives, cosmetics, and pharmaceuticals and catch a great attention for the attribution of biofuels. The microalgae are divided into three major groups: green algae (6000e8000 species), red algae (4000e5000 species), and brown algae (1500e2000 species); blue-green algae that are CO2 and ancient nitrogen fixers grow in all possible wet areas and diatoms (12,000 species). However, among those enormous number of species, only a few of them (including Chlorella (Hamed and Kl€ ock, 2014), Dunaliella salina (Sawayama et al., 1999), B. braunii (Sydney et al., 2010), Spirulina platensis (Bezerra et al., 2013), Nannochloropsis (Cavonius et al., 2015), Arthrospira (L opez et al., 2010), and Haematococcus pluvialis (Huntley and Redalje, 2007)) were adapted to biotechnology for food, chemicals, and biofuel (Kadam, 2001; Ono and Cuello, 2003). Bioprocess advantages of microalgae are (1) high growth rate, (2) high photosynthetic activity, (3) toleration to environmental stressors, (4) tolerance to high CO2 levels, (5) ease in cultivation, (6) tolerating nutrient limitations and pH, (7) living in high pollutants and heavy metal environments, and (8) shifting from phototrophic to heterotrophic growth conditions. A great contribution to microalgae science has been achieved in laboratory, and some of them achieved the industrialization. On country basis, America, Europe, Asia, Middle East countries, and India are now generating microalgae-based industries in open ponds or photobioreactors (PBRs) for CO2 capture and valorization of biomass in a technoeconomic perspective (Zhao and Su, 2014). Microalgae cultivation is done in open ponds and closed systems and aerated for efficient mixing and capturing CO2 from the atmosphere (Anjos et al., 2013; Ding et al., 2016; Smith et al., 2018). CO2 in flue gasses could be mixed with air provided to control exact amount of CO2 pumped into algal culture, and chemically, CO2 is converted into carbonates and used as nutrient. Since microalgae can utilize Na2CO3 and NaHCO3 as carbonates through CA mechanisms, this technique is also efficient for storing CO2 as carbonated forms and feeding microalgae culture. Carbonated salts can be utilized by some microalgae species, which tolerates high pH levels (9e11); thus, it gives a control strategy for the prevention of contamination by other species (Wang et al., 2008). All microalgae require CO2, light, nitrogen (most commonly in   the form of NH4þ or NO 3 ), PO4 , SO4 , and micronutrients (notably calcium, magnesium, chloride, boron, manganese, zinc, copper, molybdenum, iron) to sustain their phototrophic growth. Individual species have different requirements for their optimal growth, and these must be noted when designing the culturing systems used to maximize biomass production (Smith et al., 2018). Algal production systems are designed for efficient CO2 sequestration, high solar energy conversion rates, and providing enough illumination to sustain higher level of cell survival. Open ponds are simple in structure; however, they are susceptible for contamination, nutrient limitation, and higher water loss due to the evaporation

184

Start-Up Creation

(Chiaramonti et al., 2013). Thus, open pond systems are suitable for species that show more tolerance to stress factors. On the other hand, closed systems referred as PBRs are more favorable due to controlling environmental parameters. PBRs can be designed as having mechanical and nonmechanical agitation. Airlift, tubular, flat panel, and bubble could design are mostly preferred due to high carbon capture and algal cell survival. As mechanically agitated systems, stirred bioreactors are utilized due to excellent mass transfer properties (Benemann, 1997). Open pond systems are designed as shallow, raceway, and mixed ponds commonly, and natural lakes and lagoons are preferred for low cost design and less technical complexity and cost efficiency (Goli et al., 2016). The ponds are designed in 0.25 m width and 0.2e0.5 ha area for commercial applications. Due to light utilization limitations, they cannot be designed deeper than 0.4 m, and 0.15e0.35 m is the optimal pond depth (Sawant et al., 2018; Zhao and Su, 2014). Paddle wheels are equipped for agitation and homogenization of cultures to provide efficient mixing and mass and heat transfers (Mendoza et al., 2013).Open ponds could sequester 2 g L1d1 CO2 depending on the environmental conditions and species. Most of the early microalgae production in large scales is started in pond systems and rapidly adapted by industrial application for aquaculture feed, food, and biofuel industries. However, difficulty in light and temperature distribution, vapor losses, diffusion of dissolved CO2 into atmosphere, pollutants, and contamination risks are major drawbacks of open systems (Ho et al., 2011). They are highly affected by climatic conditions, and most of the time, sunlight collectors are required for efficient illumination. Thus, open pond systems are not favorable for fine chemical extraction from microalgae that low-cost closed systems are designed to elevate microalgae bioprocessing (Benemann, 1997; Ho et al., 2011). Sayre reported that a 28-km2-sized pond could sequester 80% of the CO2 emissions from a 200-MW coal-burning power plant during the day (Sayre, 2010). Raceway systems are about three times more productive than open pond systems and thus would require about a third of the land required by open ponds to sequester similar amounts of CO2 (Smith et al., 2018). PBRs are alternative designs of open ponds systems to elevate microalgae cultivation in a more controlled environment (Hulatt and Thomas, 2011). PBRs have higher surface/volume ratio with low contamination risks, higher CO2 fixation, feeding CO2 in a dose-dependent way, high metabolic flexibility, and ease in the cultivation of sensitive species for biotechnological applications (Soman and Shastri, 2015). Light supply and utilization are the major limiting factor on designing PBRs especially when scale-up is necessary (Bitog et al., 2011; Pires et al., 2017). Self-shading of microalgae, low light penetration when culture got denser, and photoinhibition in diluted cultures are major drawbacks. Since open ponds are in contact with atmosphere directly, gas removal cannot be considered as critical; however, in sealed bioreactors, gas dispersion and continuous gas removal are critical parameters to sustain an ideal operation condition (Doucha et al., 2005; Mendoza et al., 2013). Especially, biomass circulation and homogeneity and CO2/O2 and nutrient transfer could be achieved in a concise way; however, it should be noted that larger-scale production of PBRs than open ponds has more challenges in terms of scale, light penetration depth, construction material, and gas dispersion/removal apparatus.

Carbon sequestration in microalgae photobioreactors building integrated

185

Fundamental PBR designs are plate type, tubular PBRs, airlift, and bubble columns. These four designs have some superiorities and carry some disadvantages as well. In closed systems, operational parameters could be enhanced by the manipulation of light path, angle of light provided, designing efficient mixers and pumping, increasing the mass transfer rate by increasing the gaseliquid contact, and retention time. Column PBRs are low cost to build, and airlift PBRs are considered to be well for CO2 fixation. Bubble column PBRs on the other hand could be considered to have good mixing and flow patterns for gas utilization and removal. Because airlift PBRs have slower circulation times, they cannot compensate photoinhibitory effects. Both bioreactors aerated with air bubbles, which could have a reflector effect on light, could eventually inhibit photosynthesis and downregulate CO2 regulation. Among tubular systems, vertical tubular stacks are favored with good mixing and ease in the vertical scale-up. However, scale could not be increased indefinitely because of mass transfer, light utilization, gas removal, and temperature irregulations inside. Flat-plate types are advantageous due to higher surface/volume ratio by preventing the dead zones in terms of light capture. Flat-plate PBRs could sequester higher CO2/biomass and could have high photosynthetic efficiency. But this design has also scale-up limitations on vertical directions. The mixing in flat-type PBRs could be enhanced by utilization of mechanical mixers and baffles as it exists in conventional stirred bioreactors (Ho et al., 2011). As in the open pond systems due to the light penetration limitations, small-scale tubulars’ diameter could not exceed 5 cm, and larger scales are designed in between 15 and 20 cm. The light exposure is more efficient with smaller diameters and good vertical or horizontal angle to improve light utilization. Scale-up in tubular PBRs could be done by increasing the length and number of the tubes. Increasing the tube length could result in the uniform gas distribution. When oxygen levels are increased, RuBisCO will act as oxygenase, and photorespiration will be over photosynthesis eventually decrease CO2 fixation rate and biomass quality. Bubble columns could be scaled up as 2e5 m in height and 50 cm in sectional dimensions. In both designs, vertical orientation with angular movement through the sun if natural light will be provided is suggested for efficient land utilization. Light regimen inside the PBR is dependent on the operational and geographical conditions. Climate zones, day light periods, weather and seasonal changes, angle of sunlight, and total sunlight harvesting capacity define the primary design parameters of PBRs. To decrease electricity costs, artificial light is not preferred, but sunlight is considered and specialized solar collectors to harvest solar energy should be developed instead (Gordon and Polle, 2007; Huang et al., 2016). Photosynthetic activity and light harvesting capacity of the microalgae species, light intensity, contact surface area, cell density, and light exposure angle has also defined the light utilization and photosynthetic efficiency and carbon capture rate inside the PBRs. Full-scale tubular or platetype PBRs with a volume ratio of 20e80 m2/m3 and light incidence value up to 1150 mE m1 s1 were used for optimal cell production (Pulz and Gross, 2004). Besides, light/dark cycles also effect the cell growth since, at dark period, metabolism shifts from photosynthesis to photorespiration (Kang et al., 2011). In addition, when the dark period was as much as 50% of the cycle time, the photosynthetic efficiency was found to decrease (Huang et al., 2015; Leupold et al., 2013).

186

Start-Up Creation

PBRs could be operated under batch and continuous modes. In batch culture, media components are supplied at once, and cells start to accelerate growth. When the gas nutrient deprivation starts, cells enter a stationary phase and start to die eventually. In continuous production modes, a mother bioreactor is equipped with inlet and outlet at a constant operation volume. The nutrients along with gases are continuously supplied, and the cultures at steady state are also removed from the bioreactor dependent on the dilution rate. In this continuous system, cells could have almost similar characteristics, and batch-to-batch product changes could be eliminated. Continuous cultures seem to be favored in industrial applications where necessary, but choice of the operational modes is dependent on the purpose of the work.

8.4

Microalgae a green element for a bioactive façade

Increasing in the population increases the life compartmentalization in urban areas. Day by day, the number of the construction areas increases for the building of fancy glassefaced buildings, which in turn comes as a big problem for heat loss and/or undesired heat gain inside the buildings. Now, the terms “sustainability” and “smart” are attached to every aspect of life to add value to the creations. In this aspect, sustainable materials in building façades and their implementations with smart things are a high rise in urban and rural societies. In this matter of fact, why not to use glasses filled with microalgae to inhabitant humans with microalgae to create a new symbiotic way of living? The idea of using algae façade has several dimensions as state of the art, technology, creative design, environmental impact, and care for natural balance € (Oncel et al., 2016). Thus, building façades as in the forms of microalgal bioreactors or microalgal living walls could implement novel applications of biotechnology in the perspective of architecture and civil engineering (Fig. 8.5). Human-dense areas are also giving a great contribution to energy consumption, waste, and CO2. Using algae in human-dense area to use wastes, CO2 sequestration will elevate the circular economy model rather than a linear understanding. Cobenefits of algae and human to each other could not be underestimated: humans can provide habitats and food for algae while sequestering excess level of CO2; in turn algae will provide, oxygen, energy, food, and fertilizer for humans.

8.4.1

Bioactive façade systems from plants to microalgae

City planning is also changing its way through green solutions with modifications on conventional building understanding (Gudipudi et al., 2016). This new adaptation recovers symbiosis between living and built environment, to react environmentally friendly, economically possible, efficient and available, manageable, and constructible ecosystems with a touch of self-sustainability (Kim, 2013). This novel understanding will add functionality to novel designs, and creative designs will be embedded with biotechnology, civil engineering, materials science, thermodynamics, and heat transfer € aspects (Oncel et al., 2016).

Carbon sequestration in microalgae photobioreactors building integrated

Indoor/outdoor air Syn/flue gas streams

Test tube

CO2

Sun

187

O2 Extraction and bio/chemical reactions

Scale-up

PBR façade

Harvest

Industry

Biomass

Recycle water Waste water

Cosmetics Pharmacy

Water

Feed Food

Rain water

Renewable energy

Renewable organic carbon sources

Nutrients Butanol Biogas Hydrogen Bio/green Diesel

Methane Ethanol

Figure 8.5 From test tube to photobioreactor (PBR), the ideal loop for a progressive building PBR façade biosymbiosis (energy recycle shown in red, liquid recycle streams shown in blue, gas recycle streams shown in black, and solid recycle streams shown in green line colors).

Even though the esthetic effect of green symbiosis in construction is elevating the impact of living, it has some bottlenecks as gaining the understanding of management rather than managing conventional buildings (Kerner et al., 2019; Pruvost et al., 2014). This will also add an extra cost for sustaining green buildings in urban areas, and populations should be constantly educated with the concept and management. Even though listing the bottlenecks could look like a threat in front of green building € understanding, it is not impossible to implement it to daily life (Oncel et al., 2016). The catalysis is the ability to creative thinking to power up biological sources with construction fundamentals. Understanding the nature of biological identities and having the fundamental ideas on construction will empower and encourage creative designs. In this point of view, algae and plants are key partners for successfully adapting the technology (Khazi et al., 2018). A good integration of biology will increase the impact of urban life. From the engineering point of view, the building envelope, which is the actual border between the inside and outside, can be the strategic sight for the self-sufficiency focusing on energy, gas emissions, contamination, and waste treatment (Performance and Integration, n.d.). Microalgae implementation could help to transform cities and save destruction of urban areas, which become a critical issue after industrial revolution (Pruvost et al., 2014). Rapid industrialization increased in the population damaged the soil environment, and less green left on the earth as it was before. Increase in the concrete population eventually decreases vegetation in urban areas. The urban consistency with photosynthesis was started with green wall application using plants as breathing façade surfaces for heat and sound insulation with an esthetic touch (Kerner et al., 2019; Pruvost et al., 2016). A second renovation on the façade integration of photosynthesis

188

Start-Up Creation

comes with microalgae and cyanobacteria (Wurm, 2013). This implementation resulted in the novel designs of PBRs as a wall surface and cover for building façades (Oncel and Kose, 2016). Green façade utilization is advantageous in terms of CO2 removal, waste management, and heat and sound insulation to sustain their ability with building applications € (Oncel et al., 2016). The critical effect of green walls to building is to act as a wellcontrolled heat transfer unit between the indoor and outdoor environment to prevent heat gain or losses with respect to changes in seasons (Widiastuti et al., 2019; Larsen et al., 2014; Zhang et al., 2019). The matter of fact is that they increase the thermal sustainability of the buildings to elevate thermal performance of the building unit. Increased thermal comfort will help to improve overall energy consumption. Green façades are designed as vertical lands; thus, vegetation through vertical alignment is a major compliment on increasing the photosynthetic capacity of the cities. With their various designs, green walls could be termed as green façades and living € walls (Oncel et al., 2016). Green façades use plants on building wall surfaces. Naturally, plants are used with ability to climb through the walls with their clawlike extensions, or artificially frames or wires will be used to attach plants on the surface. Artificially designed plant walls could be more controllable, and guided plant alignments could be achieved. Living walls are new systems that are integrated on the building walls with specialized geotextile felts, boxes, trays, and so on. Opposite to the green walls, living walls are separated through the building walls with a frame, so no direct contract is achieved. The other point is improved mass transfer from the green wall units acting as a biofilter. It will not be wrong to attain breathing surfaces term to green façades. Both microalgae and plants recover excess CO2 through photosynthesis and act as a filter to emit CO2 and release O2 for a better breathable environment (Kerner et al., 2019; Pruvost et al., 2016). The natural light provided from sun could sustain photosynthesis; thus, all the sources freely available could be used for increasing mass transfer quality of the green façades. The produced O2 could be pumped indoor environment to decrease CO2 levels; also it could be released to outer environment. Green façades could also capture dust particles and sequester flue gasses as well. One critical aspect could be considered is the photorespiration at night. When light is not provided at night, microalgae cells will shift to respiratory metabolism, which may decrease air quality; however, artificial light could be provided at night to sustain photosynthesis to attenuate respiration. The main benefits of biofaçades could be listed as a biofilter for CO2, heavy metals, dust, and toxic chemicals. Removing those pollutants will improve the air quality inside the buildings. Another comforting of the system is providing thermal, acoustic improvements for a better energy management. The thermal dynamics between outdoor environment and façade will be derived from solar irradiation; thermal irradiation; natural or forced convection due to wind, rain, etc.; and conduction through the walls and PBRs. The PBRs will act as a solar shading and thermal resistance, which € can reduce energy requirements up to 30%e50% (Oncel et al., 2016). The thermal stagnant zone can provide a significant thermal resistance of 0.31 and 0.68 m2 K/W between covered and bare parts of the building façades depending on the foliar density, greening system, season, orientation, and location.

Carbon sequestration in microalgae photobioreactors building integrated Easy to construct,

Form and function

189

Easy to invest

adapted and scaled Aesthetic look

Environment

Mountable and

Low expenditure

movable frames Society

PBR façade

Economy

Higher life quality

Low energy consumption

Higher real

City

estate value Higher indoor Sustainable

comfort

Environmentally

Easy to manage

friendly

and operate

Renewable

Well equipped with automated culture

High quality, durable Co-habitation through bio-symbiosis

Higher funding opportunities

and light materials

Figure 8.6 What to expect from and ideal photobioreactor (PBR) façade with a special emphasis on environment, city, society, and economy interface. Image courtesy of CellParc Company, Dr. Martin Kerner, cellparc.com.

According to the design and economy analysis done by CellParc microalgae façade (Fig. 8.6), it has been revealed that microalgae façade is a long-run investment and it has a potential to cover energy costs of 75% (Martin Kerner: cellparc.com). In long term, maintenance and operational costs can be reduced by 100%. The potential of microalgae to serve other industries as fertilizers, fuel, and feed will eventually encourage the upcoming designs and technologies. This will benefit to make microalgae visible by societies, and the integration of microalgae façades with built environment add, a value for sustainable environment management. Microalgae facades have potential to sequester 99 kg CO2/m2, and it has a primary energy consumption of almost 2 MJ/m2. It should be noted that long-term economic analysis may be needed for the realization of microalgal façades; however, the advantage of naturally sequestering CO2 is a big impact on the investment of related fields (Kerner et al., 2019).

8.4.2

Photobioreactors: potential tool for a building live environment

Urban designing with PBRs is a relatively new concept compared with green walls. However, using microalgae as a façade surface already has many superiorities comparing with the plants. Like an installation done in microalgae production facilities, the PBRs are customized on the surface of the building walls. The PBRs are an important component to act as biocurtains, which provide great contribution to light penetration, acoustic, air quality, thermal comfort, heat, and mass transfer. The main advantage of using microalgae instead of plants comes as several aspects: Microalgae can reach high densities in a very short time due to their short doubling times in

190

Start-Up Creation

cultures. They are photosynthetic, and anthropogenic CO2 could be sequestered inside PBR facades. There are many species that could tolerate high heavy metal, light, and salt conditions; thus, viability of culture will not be threatened by environmental factors. Since they are in closed systems, the interaction with the habitat is minimized. Thus, wildlife animals may not be attracted by PBR façades as they do with plants. The PBR integration will help to control indoor and outdoor environment. The released oxygen through photosynthesis could be utilized to increase indoor air quality and humidity; thus, habitation microalgae with humans will help a more breathable environment on the long run. A simulation study concluded a decrease of 13% in CO2 level when compared a normal office building with 200 employees, to an algae façade one (Ryong et al., 2014). Heat irregulations are main problems in buildings. Increasing heat gain in summer term and excessive heat loss in winter could be crucial, which may need additional climatized systems run with gas or electricity to achieve thermal balance. This will add maintenance cost, and management cost of a building will increase. However, microalgae façades act like a great heat exchanger with changing PBR orientation through seasonal changes with respect to changing outdoor temperature and irradiance. When cultures reach a dense population, because of the shading, it will act as a natural curtain controlling illumination inside. As a result, PBR façades with regard to temperature effect can save more than 33% with regard to fuel usage and 10% with regard to electricity usage in a building (Susurova et al., 2014). The air and water will be pumped into the PBRs with various types of pumps, and also a pipeline is required for achieving a good mass transfer inside. The mixing and gas dispersion will be achieved by air through the PBR, and thus to arrange shading affects, denser cultures could be diluted to increase the light penetration to interior area. Air supply and oxygen removal inside the PBR is crucial for effective sequestration of CO2. When the oxygen level is increased in the PBR, the RuBisCO will downregulate carboxylase activity and activate oxygenase. This may result in the increase in CO2 concentration. This is a critical point to consider. To elevate carboxylase activity in higher level possible, a good oxygen removal, degassing, and gas dispersion unit should be designed in a more esthetic point of view. To enhance light utilization capacity of microalgae species, organic dyes such as rhodamine 101 and 9,10-diphenylanthracene could be used to increase CO2 conversion efficiency directing useless wavelengths to microalgal photosynthesis. This strategy could enhance the biomass quantity and lipid storage, which is beneficial for further utilization of biomass (Huang et al., 2016). Microalgae will have an indirect contact with the environment. Thus, the damage of microalgae to be given the environment will be minimized. Most of the microalgae species are environmentally friendly in culture systems apart from toxic bloom forming cyanobacteria. Thus, the selection of the species for PBR façade integration is a crucial step while designing the biological aspects. The common species already easily produced in outdoor environment are Chlorella sp., C. vulgaris, Nannochloropsis, Nostoc sp., Anabaena sp., etc. (Ajjawi et al., 2017; Hanagata et al., 1992). These species are usually green in color, and the spectrum of the green color gets darker when culture gets denser. However, when cells are started to get some stress physiology activated, due to the secondary metabolism, they may turn into yellow-green. Dunaliella salina, Haematococcus pluvialis, and Neochloris texensis species are rich in

Carbon sequestration in microalgae photobioreactors building integrated

191

pigments mostly carotenoids (Barbosa et al., 2003; Huntley and Redalje, 2007; Sawayama et al., 1999). These species will start with a green color, and at higher irradiances, they will turn into red-orange depending on the dominant pigments as astaxanthin, lutein, and lycopene. On the other hand, diatoms are brown in culture, and the mostly bioprocessed diatom is Phaeodactylum. Due to fucoxanthin pigment, it will give a brown color to the culture. The species choice will be dependent on the CO2 amount to be sequestered, temperature, illumination, and irradiation amount of the building. Due to their CCM metabolism, some species will be tolerating high levels of CO2; however, more than 5% will be toxic to most of the species. Thus, preliminary studies with the façade environment should have been done before implementation of the species. The PBR façades could be utilized in urban areas or industrial zones. The power plant, cement industry, mine, and coal factories are CO2-dense areas, and flue gas in these plants could be also evaluated inside PBR façades for maintenance buildings. This will decrease the maintenance cost of the industry and add an environmental impact since the CO2 and other wastes should be remodeled for a better utilization. In power plants, due to high velocity of flue gas, low mass transfer is occurred between liquids and gas phase. To obtain flue gas in a more available form, absorption liquid is utilized with algae as a photochemical CO2 desorber. Thus, this absorption liquid is fed directly to algae pond; in this case, the liquid needs to be pumped directly into the PBR façade. The absorption liquid is separated by filtration, and biomass is filtered. In this case, the liquid could be reused via recirculation (Huang et al., 2016). The adaptation of classical carbon capture technology to microalgae production inside PBRs on building surfaces will integrate both industries under one topic, that is, decreasing carbon foot printing and adding value to flue gas CO2. Of course, the capital and management cost, in other terms economic impact of the PBRs, should also be evaluated. In that case, microalgae also offer an advantage due to high-value compounds in their biomass. Biomass could be used as feed or evaluated as fuel. It is a good storage for biodiesel, biomethane, biohydrogen, and bioethanol. Thus, produced biomass could be an input of biofuel industry. Culture liquid could be reutilized according to nutrient levels inside. With this circular utilization understanding, microalgae will be a sustainable partner in built environments. As per the projection from an economic simulation on a green wall, where the 50 years of building service life considered PBR system, cost and pay-off balance will be a very important issue to be successful in application. The integration of microalgae will help to design a selfsufficient living habitat. Soon, it looks like we will see more microalgae orientation through the building surfaces to successfully mitigate CO2 on individual basis. Various concepts such as Marina City Tower (United States), Process Zero Building (United States), FSMA Tower (UK), Le CONEX (France), and In Vivo (France) introduced at the design stage only few real life proofs considering full scale such as the Algae House for International Building Exhibition, Hamburg, Germany, by ARUP or the pilot-scale PBR facade at CSTB Headquarters, Champs-sur-Marne, France, by XTU architects [12, 14] show the reality that the technology is still at the starting stage (Fig. 8.7). But the advantages with regard to key benefits from microalgae will be the driving force for the future.

192

Start-Up Creation

Building

Host building Air cooling channel

Steel plate

PBR Protection window

Culture Window 2 Air Window 1 Outside

Figure 8.7 SymBIO2 project box pilot unit (with design partners XT-U architects) thermal optimization of photobioreactor (PBR) building synergies, GEPEA, Saint-Nazaire (France). Courtesy of Prof. Jack Legrand.

8.5

Concluding remarks and future trends

Microalgae could successfully sequester CO2 via their specialized metabolisms. CCMs are a great advantage to mitigate CO2 biologically (Giordano et al., 2005). The merging green façades with CCM metabolism of microalgae will be useful to develop carbon management technology. The primary focus on this level is the choosing right organism giving the best benefit on carbon mitigation. The choice of the organism is critical for design and operation of microalgae façades. The criteria to choose the best fitting organisms for carbon sequestration could be evaluated under biological, financial, and environmental factors. Biologically the photosynthetic activity, growth rate, tolerance to high rates CO2 concentration and pollutants, and tolerance to changing pH and temperature are critical parameters to choose promising species. Financially the land use, requirements of control systems elements, nutrient utilization, water requirement, and downstream processing are embedded together with biological and environmental issues. Cost-effective design and operation in an optimum CO2 mitigation should be the goal. Biological aspect of the organisms will determine the cultivation strategy and after. Continuous strain searching will give species with high CO2 mitigation capacity. For instance, water reserves close to power plants, cement, and coal industry could habitat high CO2 tolerance species. Previously, Scenedesmus and Chlorella kessleri species were isolated with high CO2 tolerance up to 18% (Table 8.2). These species are also promising for algal industry and façade applications. Random mutagenesis, site-directed and site-specific mutations, strain engineering, and genetic engineering techniques are applicable to microalgae species. Engineering CCMs could enhance cells’ CO2 harvesting capacity. Engineering the RuBisCO to downregulate oxygenase activity to decrease oxygen affinity will help to fix more CO2 than it is in wild-type

Carbon sequestration in microalgae photobioreactors building integrated

193

strains. Photosynthesis is a complex dynamic, and it is highly affected by environmental factors. Light harvesting capacity of microalgae could be engineered to decrease light-driven photoinhibition effects. Truncated antenna sizes will help to achieve a better photosynthesis rate. On the other hand, not all the microalgae species are able to utilize complex organic carbon sources. Engineering on the nutrient utilization will add a value to species to consume various organic wastes or by-products. These approaches will support the scientific basis of microalgae-based CO2 mitigation and encourage further applications. By this case, knockout and gene transfer to create superior microalgae strains will benefit for global CO2 sequestration. A novel technique on targeted genome engineering named CRISPR looks promising for designer microalgae species using effluent CO2 as sole carbon sources (Carroll et al., 2018; Sun et al., 2018; Tong et al., 2019). Not only CO2 sequestration capacity could be enhanced but also new traits and pathways could be engineered to develop novel products based on food, fuel, household stuffs, textiles products, and, as the topic of this chapter, biofaçades powered by microalgae. The cost of CO2 sequestration is a vital topic to discuss about for future projections. CO2 transport and storage should be 5e15 US$/ton. Other costs of microalgae are required for air compression, pumping the water, water recycle, harvesting of biomass, and other downstream processes related to biomass to fuel or product conversion. One of the major portions of the costs is also going to the design of PBR façade system. Considering the material and maintenance costs, designs should be done with durable, easy to clean, and operate materials with lower costs. Downstream processing and pumping systems should be selected to perform highest yields possible with low energy requirement. Novel materials to access a better thermal comfort and light penetration should be developed in the future. According to the recast of the Energy Performance of Buildings Directive (Directive 2010/31/EU), all new buildings in the EU should consume nearly zero energy by the end of 2020. Buildings are the largest energy end-use sector (about 40% of total final energy use in the EU-28 and the United States). Thus, a rapid and reliable integration of renewable energy technologies is a major requirement for building maintenance. CO2 sequestration technology could also be attached to microbial fuel cells (MFCs) to directly generate electricity. MFCs could use wastewaters and heavy metals to empower renewable technologies. One major disadvantage is the low yield in terms of energy density, and scale-up in multitasks for larger electricity generation is a big challenge (Wu et al., 2018; You et al., 2019). The cost aspect of MFC development lays on the defining and investigation of new materials to perform with a better efficiency, but large-scale applications still have a long road to go. Nevertheless, biofaçades with empowering microalgal CO2 sequestration ability are a critical milestone on built environment development. The technology is promising with major challenges, but it is quite sure that this technology will go beyond from sketches to real-life applications.

194

Start-Up Creation

Acknowledgments The authors would like to thank Dr. Martin Kerner (microalgal biofaçades, CellParc, GmbH, Hamburg, Germany) and Prof. Jack Legrand (University of Nantes, France) for their valuable support, sharing their designs and opinions for the chapter. And the authors would like to thank again all the contributors for their kindness and help.

References Ajjawi, I., Verruto, J., Aqui, M., Soriaga, L.B., Coppersmith, J., Kwok, K., Peach, L., Orchard, E., Kalb, R., Xu, W., Carlson, T.J., Francis, K., Konigsfeld, K., Bartalis, J., Schultz, A., Lambert, W., Schwartz, A.S., Brown, R., Moellering, E.R., 2017. Lipid production in Nannochloropsis gaditana is doubled by decreasing expression of a single transcriptional regulator. Nature Biotechnology 35, 647e652. https://doi.org/10.1038/ nbt.3865. Anjos, M., Fernandes, B.D., Vicente, A.A., Teixeira, J.A., Dragone, G., 2013. Optimization of CO2 bio-mitigation by Chlorella vulgaris. Bioresource Technology. 139, 149e154. https:// doi.org/10.1016/j.biortech.2013.04.032. Assis, T.C. de, Calijuri, M.L., Assemany, P.P., Pereira, A.S.A. de P., Martins, M.A., 2019. Using atmospheric emissions as CO2 source in the cultivation of microalgae: productivity and economic viability. Journal of Cleaner Production 215, 1160e1169. https://doi.org/ 10.1016/j.jclepro.2019.01.093. Baena-Moreno, F.M., Rodríguez-Galan, M., Vega, F., Alonso-Fari~ nas, B., Vilches Arenas, L.F., Navarrete, B., 2019. Carbon capture and utilization technologies: a literature review and recent advances. Energy Sources, Part A Recovery, Utiliztion Environmental Effects 41, 1403e1433. https://doi.org/10.1080/15567036.2018.1548518. Barbosa, M.J., Albrecht, M., Wijffels, R.H., 2003. Hydrodynamic stress and lethal events in sparged microalgae cultures. Biotechnology and Bioengineering 83, 112e120. https:// doi.org/10.1002/bit.10657. Benemann, J.R., 1997. CO2 mitigation with microalgae systems. Energy Conversion and Management 38, 475e479. Bezerra, R.P., Matsudo, M.C., Sato, S., Converti, A., de Carvalho, J.C.M., 2013. Fed-batch cultivation of Arthrospira platensis using carbon dioxide from alcoholic fermentation and urea as carbon and nitrogen sources. BioEnergy Research 6, 1118e1125. https:// doi.org/10.1007/s12155-013-9344-1. Bitog, J.P., Lee, I.B., Lee, C.G., Kim, K.S., Hwang, H.S., Hong, S.W., Seo, I.H., Kwon, K.S., Mostafa, E., 2011. Application of computational fluid dynamics for modeling and designing photobioreactors for microalgae production: a review. Computers and Electronics in Agriculture. https://doi.org/10.1016/j.compag.2011.01.015. Bleakley, S., Hayes, M., 2017. Algal proteins: extraction, application, and challenges concerning production. Foods 6, 33. https://doi.org/10.3390/foods6050033. Carroll, A.L., Case, A.E., Zhang, A., Atsumi, S., 2018. Metabolic engineering tools in model cyanobacteria. Metabolic Engineering 50, 47e56. https://doi.org/10.1016/ j.ymben.2018.03.014. Cavonius, L.R., Albers, E., Undeland, I., 2015. pH-shift processing of Nannochloropsis oculata microalgal biomass to obtain a protein-enriched food or feed ingredient. Algal Research 11, 95e102. https://doi.org/10.1016/j.algal.2015.05.022.

Carbon sequestration in microalgae photobioreactors building integrated

195

Chauvy, R., Meunier, N., Thomas, D., De Weireld, G., 2019. Selecting emerging CO2 utilization products for short- to mid-term deployment. Applied Energy 236, 662e680. https:// doi.org/10.1016/j.apenergy.2018.11.096. Chiaramonti, D., Prussi, M., Casini, D., Tredici, M.R., Rodolfi, L., Bassi, N., Zittelli, G.C., Bondioli, P., 2013. Review of energy balance in raceway ponds for microalgae cultivation: re-thinking a traditional system is possible. Applied Energy 102, 101e111. https://doi.org/ 10.1016/j.apenergy.2012.07.040. Chiu, S.Y., Tsai, M.T., Kao, C.Y., Ong, S.C., Lin, C.S., 2009. The air-lift photobioreactors with flow patterning for high-density cultures of microalgae and carbon dioxide removal. Engineering in Life Sciences 9, 254e260. https://doi.org/10.1002/elsc.200800113. Ding, Y.D., Zhao, S., Liao, Q., Chen, R., Huang, Y., Zhu, X., 2016. Effect of CO2 bubbles behaviors on microalgal cells distribution and growth in bubble column photobioreactor. International Journal of Hydrogen Energy 41, 4879e4887. https://doi.org/10.1016/ j.ijhydene.2015.11.050. Doucha, J., Straka, F., Lívanský, K., 2005. Utilization of flue gas for cultivation of microalgae (Chlorella sp.) in an outdoor open thin-layer photobioreactor. Journal of Applied Phycology 17, 403e412. https://doi.org/10.1007/s10811-005-8701-7. Douskova, I., Doucha, J., Livansky, K., MacHat, J., Novak, P., Umysova, D., Zachleder, V., Vitova, M., 2009. Simultaneous flue gas bioremediation and reduction of microalgal biomass production costs. Applied Microbiology and Biotechnology 82, 179e185. https:// doi.org/10.1007/s00253-008-1811-9. Giordano, M., Beardall, J., Raven, J.A., 2005. CO2 concentrating mechanisms in algae: mechanisms, environmental modulation, and evolution. Annual Review of Plant Biology 56, 99e131. https://doi.org/10.1146/annurev.arplant.56.032604.144052. Goli, A., Shamiri, A., Talaiekhozani, A., Eshtiaghi, N., Aghamohammadi, N., Aroua, M.K., 2016. An overview of biological processes and their potential for CO2 capture. Journal of Environmental Economics and Management 183, 41e58. https://doi.org/10.1016/ j.jenvman.2016.08.054. Gordon, J.M., Polle, J.E.W., 2007. Ultrahigh bioproductivity from algae. Applied Microbiology and Biotechnology 76, 969e975. https://doi.org/10.1007/s00253-007-1102-x. Gudipudi, R., Fluschnik, T., Ros, A.G.C., Walther, C., Kropp, J.P., 2016. City density and CO2 efficiency. Energy Policy 91, 352e361. https://doi.org/10.1016/j.enpol.2016.01.015. Hamed, S.M., Kl€ock, G., 2014. Improvement of medium composition and utilization of mixotrophic cultivation for green and blue green microalgae towards biodiesel production. Advances in Microbiology 04, 167e174. https://doi.org/10.4236/aim.2014.43022. Hanagata, N., Takeuchi, T., Fukuju, Y., Barnes, D.J., Karube, I., 1992. Tolerance of microalgae to high CO2 and high temperature. Phytochemistry 31, 3345e3348. https://doi.org/ 10.1016/0031-9422(92)83682-O. Ho, S.H., Chen, C.Y., Lee, D.J., Chang, J.S., 2011. Perspectives on microalgal CO2-emission mitigation systems - a review. Biotechnology Advances 29, 189e198. https://doi.org/ 10.1016/j.biotechadv.2010.11.001.  Hou, S., Brenes-Alvarez, M., Reimann, V., Alkhnbashi, O.S., Backofen, R., Muro-Pastor, A.M., Hess, W.R., 2019. CRISPR-Cas systems in multicellular cyanobacteria. RNA Biology 16, 518e529. https://doi.org/10.1080/15476286.2018.1493330. Huang, G., Chen, F., Kuang, Y., He, H., Qin, A., 2016. Current techniques of growing algae using flue gas from exhaust gas industry: a review. Applied Biochemistry and Biotechnology 178, 1220e1238. https://doi.org/10.1007/s12010-015-1940-4.

196

Start-Up Creation

Huang, J., Feng, F., Wan, M., Ying, J., Li, Y., Qu, X., Pan, R., Shen, G., Li, W., 2015. Improving performance of flat-plate photobioreactors by installation of novel internal mixers optimized with computational fluid dynamics. Bioresource Technology 182, 151e159. https://doi.org/10.1016/j.biortech.2015.01.067. Hulatt, C.J., Thomas, D.N., 2011. Productivity, carbon dioxide uptake and net energy return of microalgal bubble column photobioreactors. Bioresource Technology 102, 5775e5787. https://doi.org/10.1016/j.biortech.2011.02.025. Huntley, M.E., Redalje, D.G., 2007. CO2 Mitigation and Renewable Oil from Photosynthetic Microbes: A New Appraisal, Mitigation and Adaptation Strategies for Global Change. https://doi.org/10.1007/s11027-006-7304-1. IPCC, 2018. Global Warming of 1.5 C. An IPCC Special Report on the impacts of global warming of 1.5 C above pre-industrial levels and related global greenhouse gas emission pathways. In: Zhai, V.P., P€ortner, H.-O., Roberts, D., Skea, J., Shukla, P.R., Pirani, A., Moufouma-Okia, W., Péan, C., Pidcock, R., Connors, S., Matthews, J.B.R., Chen, Y., Zhou, X., Gomis, M.I., Lonnoy, E., Maycock, T., Tignor, M., Waterfield, T. (Eds.), the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty [Masson-Delmotte]. Kadam, K.L., 2001. Microalgae Production from Power Plant Flue Gas: Environmental Implications on a Life Cycle Basis. Contract 1e63. https://doi.org/10.2172/783405. Kairupan, T.S., Cheng, K.-C., Asakawa, A., Amitani, H., Yagi, T., Ataka, K., Rokot, N.T., Kapantow, N.H., Kato, I., Inui, A., 2019. Rubiscolin-6 activates opioid receptors to enhance glucose uptake in skeletal muscle. Journal of Food and Drug Analysis 27, 266e274. https://doi.org/10.1016/J.JFDA.2018.06.012. Kang, K.H., Ryu, B.M., Kim, S.K., Qian, Z.J., 2011. Characterization of growth and protein contents from microalgae Navicula incerta with the investigation of antioxidant activity of enzymatic hydrolysates. Food Science and Biotechnology 20, 183e191. https://doi.org/ 10.1007/s10068-011-0025-6. Kaplan, A., Reinhold, L., 1999. CO2 concentrating mechanisms in photosynthetic microorganisms. Annual Review of Plant Physiology and Plant Molecular Biology 50, 539e570. https://doi.org/10.1146/annurev.arplant.50.1.539. Kasiri, S., Ulrich, A., Prasad, V., 2015. Optimization of CO2 fixation by Chlorella kessleri cultivated in a closed raceway photo-bioreactor. Bioresource Technology 194, 144e155. https://doi.org/10.1016/J.BIORTECH.2015.07.017. Kerner, M., Gebken, T., Sundarrao, I., Hindersin, S., Sauss, D., 2019. Development of a control system to cover the demand for heat in a building with algae production in a bioenergy façade. Energy and Buildings 184, 65e71. https://doi.org/10.1016/j.enbuild.2018.11.030. Khazi, M.I., Demirel, Z., Dalay, M.C., 2018. Evaluation of growth and phycobiliprotein composition of cyanobacteria isolates cultivated in different nitrogen sources. Journal of Applied Phycology 30, 1513e1523. https://doi.org/10.1007/s10811-018-1398-1. Kim, K.-H., 2013. Beyond green: growing algae facade. Visibility of Research Sustainability: Visualization Sustainability and Performance 500e505. Kliphuis, A.M.J., Martens, D.E., Janssen, M., Wijffels, R.H., 2011. Effect of O2 :CO2 ratio on the primary metabolism of Chlamydomonas reinhardtii. Biotechnology and Bioengineering 108, 2390e2402. https://doi.org/10.1002/bit.23194. Koller, M., Muhr, A., Braunegg, G., 2014. Microalgae as versatile cellular factories for valued products. Algal Research 6, 52e63. https://doi.org/10.1016/J.ALGAL.2014.09.002. Larsen, S.F., Flippin, C., Lesino, G., 2014. Thermal simulation of a double skin façade with plants. Energy Procedia 57, 1763e1772.

Carbon sequestration in microalgae photobioreactors building integrated

197

Leupold, M., Hindersin, S., Gust, G., Kerner, M., Hanelt, D., 2013. Influence of mixing and shear stress on Chlorella vulgaris, Scenedesmus obliquus, and Chlamydomonas reinhardtii. Journal of Applied Phycology 485e495. https://doi.org/10.1007/s10811-0129882-5. Li, S., Sun, T., Xu, C., Chen, L., Zhang, W., 2018. Development and optimization of genetic toolboxes for a fast-growing cyanobacterium Synechococcus elongatus UTEX 2973. Metabolic Engineering 48, 163e174. https://doi.org/10.1016/j.ymben.2018.06.002. L opez, C.V.G., del Carmen Ceron García, M., Fernandez, F.G.A., Bustos, C.S., Chisti, Y., Sevilla, J.M.F., 2010. Protein measurements of microalgal and cyanobacterial biomass. Bioresource Technology 101, 7587e7591. https://doi.org/10.1016/j.biortech.2010.04.077. Ma, J., Wang, Z., Zhang, J., Waite, T.D., Wu, Z., 2017. Cost-effective Chlorella biomass production from dilute wastewater using a novel photosynthetic microbial fuel cell (PMFC). Water Research 108, 356e364. https://doi.org/10.1016/j.watres.2016.11.016. Maeda, K., Owada, M., Kimura, N., Omata, K., Karube, I., 1995. CO2 fixation from the flue gas on coal-fired thermal power plant by microalgae. Energy Conversion and Management 36, 717e720. https://doi.org/10.1016/0196-8904(95)00105-M. Makido, Y., Dhakal, S., Yamagata, Y., 2012. Relationship between urban form and CO2 emissions: evidence from fifty Japanese cities. Urban Climate 2, 55e67. https://doi.org/ 10.1016/j.uclim.2012.10.006. Mendoza, J.L., Granados, M.R., de Godos, I., Acién, F.G., Molina, E., Heaven, S., Banks, C.J., 2013. Oxygen transfer and evolution in microalgal culture in open raceways. Bioresource Technology 137, 188e195. https://doi.org/10.1016/j.biortech.2013.03.127. Mistry, A.N., Ganta, U., Chakrabarty, J., Dutta, S., 2019. A review on biological systems for CO2 sequestration: organisms and their pathways. Environmental Progress and Sustainable Energy 38, 127e136. https://doi.org/10.1002/ep.12946. Mondal, M.K., Balsora, H.K., Varshney, P., 2012. Progress and trends in CO2 capture/separation technologies: a review. Energy 46, 431e441. https://doi.org/10.1016/ j.energy.2012.08.006. Moran, D., Kanemoto, K., Jiborn, M., Wood, R., T€obben, J., Seto, K.C., 2018. Carbon footprints of 13,000 cities. Environmental Research Letters 13. https://doi.org/10.1088/1748-9326/ aac72a. Norhasyima, R.S., Mahlia, T.M.I., 2018. Advances in CO2 utilization technology: a patent landscape review. Journal of CO2 Utilization 26, 323e335. https://doi.org/10.1016/ j.jcou.2018.05.022. Oncel, S.S., K€ose, A., 2016. Photobioreactors For Sustaınable Buıldıngs. Dokuz Eyl€ ul € Universitesi M€uhendislik Fak€ultesi Fen ve M€uhendislik Dergisi 18 (52), 77e88. Oncel, S., Sabankay, M., 2012. Microalgal biohydrogen production considering light energy and mixing time as the two key features for scale-up. Bioresource Technology. https://doi.org/ 10.1016/j.biortech.2012.06.079. Oncel, S., 2013. Microalgae for a macro energy world. Renewable and Sustainable Energy Reviews 26, 241e264. Oncel, S.S., et al., 2015. From the ancient tribes to modern societies, microalgae evolution from a simple food to an alternative fuel source. In: Kim, S.K. (Ed.), Handbook of Marine Microalgae. Biotechnology Advances. Academic Press, pp. 127e144. Oncel, S.S., 2015. Biohydrogen from microalgae, uniting energy, life, and green future. In: Kim, S.K. (Ed.), Handbook of Marine Microalgae. Biotechnology Advances. AcademicPress, pp. 159e196.

198

Start-Up Creation

€ € Oncel, S.S¸., K€ose, A., Oncel, D.S¸., 2016. In: Pacheco-Torgal, F., Rasmussen, E.S., Granqvist, C.G., Ivanov, V., Kaklauskas, H.A. (Eds.), Façade Integrated Photobioreactors for Building Energy Efficiency, Start-Up Creation: The Smart Eco-Efficient Built Environment. Woodhead Publishing Inc., Amsterdam, pp. 237e299. Ono, E., Cuello, J., 2003. Selection of optimal microalgae species for CO2 sequestration. National Conference on Carbon Sequestration 1e7. Ono, E., Cuello, J.L., 2006. Feasibility assessment of microalgal carbon dioxide sequestration technology with photobioreactor and solar collector. Biosystems Engineering 95, 597e606. https://doi.org/10.1016/j.biosystemseng.2006.08.005. Performance, K., Integration, B., n.d. Solarleaf. Pires, J.C.M., Alvim-Ferraz, M.C.M., Martins, F.G., 2017. Photobioreactor design for microalgae production through computational fluid dynamics: a review. Renewable and Sustainable Energy Reviews 79, 248e254. https://doi.org/10.1016/j.rser.2017.05.064. Pruvost, J., Le Gouic, B., Lepine, O., Legrand, J., Le Borgne, F., 2016. Microalgae culture in building-integrated photobioreactors: biomass production modelling and energetic analysis. Chemical Engineering Journal 284, 850e861. https://doi.org/10.1016/ j.cej.2015.08.118. Pruvost, J., Le Gouic, B., Lepine, O., Legrand, J., Le Borgne, F., 2014. Symbiotic integration of photobioreactors in a factory building facade for mutual benefit between buildings and microalgae needs. In: 21st Int. Congr. Chem. Process Eng. CHISA 2014 17th Conf. Process Integr. Model. Optim. Energy Sav. Pollut. Reduction. PRES 2014 4, 2184. Pulz, O., 2001. Photobioreactors: production systems for phototrophic microorganisms. Applied Microbiology and Biotechnology 57, 287e293. Pulz, M.O., Gross, W., 2004. Valuable products from biotechnology of microalgae. Applied Microbiology and Biotechnology 635e648. https://doi.org/10.1007/s00253-0041647-x. Rasmussen, B., Fletcher, I.R., Brocks, J.J., Kilburn, M.R., 2008. Reassessing the first appearance of eukaryotes and cyanobacteria. Nature 455, 1101e1104. https://doi.org/10.1038/ nature07381. Ravelonandro, P.H., Ratianarivo, D.H., Joannis-Cassan, C., Isambert, A., Raherimandimby, M., 2011. Improvement of the growth of Arthrospira (Spirulina) platensis from Toliara (Madagascar): Effect of agitation, salinity and CO2 addition. Food and Bioproducts Processing 89, 209e216. https://doi.org/10.1016/j.fbp.2010.04.009. Reich, P.B., 2009. Elevated CO2 reduces losses of plant diversity caused by nitrogen deposition. Science 326, 1399e1402. https://doi.org/10.1126/science.1178820. Sandmann, M., Garz, A., Menzel, R., 2016. Physiological response of two different Chlamydomonas reinhardtii strains to lightedark rhythms. Botany 94, 53e64. https://doi.org/ 10.1139/cjb-2015-0144. Sawant, S.S., Khadamkar, H.P., Mathpati, C.S., Pandit, R., Lali, A.M., 2018. Computational and experimental studies of high depth algal raceway pond photo-bioreactor. Renewable Energy. https://doi.org/10.1016/j.renene.2017.11.015. Sawayama, S., Minowa, T., Yokoyama, S.Y., 1999. Possibility of renewable energy production and CO2 mitigation by thermochemical liquefaction of microalgae. Biomass and Bioenergy 17, 33e39. https://doi.org/10.1016/S0961-9534(99)00019-7. Sayre, R., 2010. Microalgae: the potential for carbon capture. Bioscience 60, 722e727. https:// doi.org/10.1525/bio.2010.60.9.9. Sepulveda, C., Gomez, C., El Bahraoui, N., Acién, G., 2019. Comparative evaluation of microalgae strains for CO2 capture purposes. Journal of CO2 Utilization 30, 158e167. https://doi.org/10.1016/j.jcou.2019.02.004.

Carbon sequestration in microalgae photobioreactors building integrated

199

Shabestary, K., Anfelt, J., Ljungqvist, E., Jahn, M., Yao, L., Hudson, E.P., 2018. Targeted repression of essential genes to arrest growth and increase carbon partitioning and biofuel titers in cyanobacteria. ACS Synthetic Biology 7, 1669e1675. https://doi.org/10.1021/ acssynbio.8b00056. Singh, J., Dhar, D.W., 2019. Overview of carbon capture technology: microalgal biorefinery concept and state-of-the-art. Frontiers in Marine Science 6, 1e9. https://doi.org/10.3389/ fmars.2019.00029. Skulberg, O.M., 2000. Microalgae as a source of bioactive molecules - experience from cyanophyte research. Journal of Applied Phycology 12, 341e348. https://doi.org/10.1023/A: 1008140403621. Smith, R.G., Smith, I.J., Smith, B.D., 2018. A novel strategy for sequestering atmospheric CO2: the use of sealed microalgal cultures located in the open-oceans. Renewable and Sustainable Energy Reviews 83, 85e89. https://doi.org/10.1016/j.rser.2017.10.001. Soman, A., Shastri, Y., 2015. Optimization of novel photobioreactor design using computational fluid dynamics. Applied Energy 140, 246e255. https://doi.org/10.1016/ j.apenergy.2014.11.072. Sun, T., Li, S., Song, X., Diao, J., Chen, L., Zhang, W., 2018. Toolboxes for cyanobacteria: recent advances and future direction. Biotechnology Advances 36, 1293e1307. https:// doi.org/10.1016/j.biotechadv.2018.04.007. Susurova, I., et al., 2014. The effects of climbing vegetation on the local microclimate, thermal performance, and air infiltration of four building facade orientations. Building and Environment 76, 113e124. Sydney, E.B., Sturm, W., de Carvalho, J.C., Thomaz-Soccol, V., Larroche, C., Pandey, A., Soccol, C.R., 2010. Potential carbon dioxide fixation by industrially important microalgae. Bioresource Technology 101, 5892e5896. https://doi.org/10.1016/j.biortech.2010.02.088. Tang, D., Han, W., Li, P., Miao, X., Zhong, J., 2011. CO2 biofixation and fatty acid composition of Scenedesmus obliquus and Chlorella pyrenoidosa in response to different CO2 levels. Bioresource Technology 102, 3071e3076. https://doi.org/10.1016/j.biortech.2010.10.047. Tong, Y., Weber, T., Lee, S.Y., 2019. CRISPR/Cas-based genome engineering in natural product discovery. Natural Product Reports. https://doi.org/10.1039/c8np00089a. Tredici, M., 2004. Mass production of microalgae: photobioreactors. In: Richmond, A. (Ed.), Handbook of Microalgal Mass Cultures. Blackwell, Oxford, pp. 178e214. Wang, B., Li, Y., Wu, N., Lan, C.Q., 2008. CO2 bio-mitigation using microalgae. Applied Microbiology and Biotechnology 79, 707e718. https://doi.org/10.1007/s00253-008-1518-y. Wang, S., Fang, C., Wang, Y., Huang, Y., Ma, H., 2015. Quantifying the relationship between urban development intensity and carbon dioxide emissions using a panel data analysis. Ecological Indicators 49, 121e131. https://doi.org/10.1016/j.ecolind.2014.10.004. Widiastuti, R., Caesarendra, W., Zaini, J., 2019. Observation to building thermal characteristic of green façade model based on various leaves covered area. Buildings 9 (75). Article (in press). Wu, H., Fu, Y., Guo, C., Li, Y., Jiang, N., Yin, C., 2018. Electricity generation and removal performance of a microbial fuel cell using sulfonated poly (ether ether ketone) as proton exchange membrane to treat phenol/acetone wastewater. Bioresource Technology 260, 130e134. https://doi.org/10.1016/j.biortech.2018.03.133. Wurm, J., 2013. Photobioreactors on facades for energy generation, alternative technologies in the building envelope. In: Int. Rosenheim Window and Facade Conference, pp. 83e87. Yang, H., Xu, Z., Fan, M., Gupta, R., Slimane, R.B., Bland, A.E., Wright, I., 2008. Progress in carbon dioxide separation and capture: a review. Journal of Environmental Sciences 20, 14e27. https://doi.org/10.1016/S1001-0742(08)60002-9.

200

Start-Up Creation

You, J., Rimbu, G.A., Wallis, L., Greenman, J., Ieropoulos, I., 2019. Living architecture: toward energy generating buildings powered by. Microbial Fuel Cells 7, 1e8. https://doi.org/ 10.3389/fenrg.2019.00094. Zhang, L., Deng, Z., Liang, L., Zhag, Y., Meng, Q., Wang, J., 2019. Thermal behavior of a vertical green facade and its impact on the indoor and outdoor thermal environment. Energy and Buildings 502. Zhao, B., Su, Y., 2014. Process effect of microalgal-carbon dioxide fixation and biomass production: a review. Renewable and Sustainable Energy Reviews 31, 121e132. https:// doi.org/10.1016/j.rser.2013.11.054. Zheng, H., Gao, Z., Yin, F., Ji, X., Huang, H., 2012. Effect of CO2 supply conditions on lipid production of Chlorella vulgaris from enzymatic hydrolysates of lipid-extracted microalgal biomass residues. Bioresource Technology 126, 24e30. https://doi.org/10.1016/ j.biortech.2012.09.048.

Affective Internet of Things 1

2

2

2

9

A. Kaklauskas , I. Lill , R. Puust , I. Ubarte 1 Department of Construction Management and Real Estate, Faculty of Civil Engineering, Vilnius Gediminas Technical University, Vilnius, Lithuania; 2Building Lifecycle Research Group, Department of Civil Engineering and Architecture, Tallinn University of Technology, Tallinn, Estonia

9.1

Affective Internet of Things

Affective Internet of Things (IoT) is applicable in various areas (Fig. 9.1). For example, wearable emotion sensors are widely used by psychologists and therapists, in clinics, hospitals, etc. IoT is implementing emotional ingredients in the wristbands too. Their sensor technology also allows for gathering data on heart rate, blood pressure, and temperature to define an individual’s emotional states. Such emotion sensors are relatively low cost, easy to use, and have a wide variety of utilization. Smart watches and health wearables create a foundation for technology that helps coordinate daily habits while avoiding potential health issues and other problems. With a modern smart device, the user can track and evaluate their physical condition and how they react to stress-inducing situations, as well as learn to manage stress and anxiety better. The device might instruct them to practice a mind controlling technique or to do breathing exercises to calm down or to turn on relaxing music (Slesar, 2018). There are many advantages to using anthropomorphic approaches when designing things. Anthropomorphic techniques that use human language and symbolism and devices such as virtual assistants and chatbots can promote natural interaction, trust, learning, and empathy between artificial intelligence (AI) software/models and humans. That’s not to say that a strong anthropomorphic approach is always best. In sensitive situations (such as a robot providing medical advice to a user), overly anthropomorphic approaches could make patients uncomfortable and prevent them from disclosing essential information. Anthropomorphization also offers another opportunity. This is the notion of obtaining digital customer/worker/citizen feedback from the “voice of the thing” (VoT). Humanizing a connected thing creates the opportunity to obtain feedback from it in the same way we would from a human being, complementing existing human feedback. Another key consideration is determining whether a thing has a “voice.” It’s important to distinguish between simple reporting of operational IoT data and what would be considered the VoT. The key distinction is that VoT requires some form of intelligence that drives thing opinion. The VoT does not just report facts. It enriches them, contextualizes them, and provides a rationale for the feedback. While the baseline for thing feedback is simply factual and event-based reporting, the VoT should be associated with something moredencompassing

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00009-6 Copyright © 2020 Elsevier Ltd. All rights reserved.

204

Start-Up Creation

Built environment Automotive industry

Medicine

Home appliances

Working conditions and safety

Advertising

Robotics

Affective IoT application areas

Education

Diagnostic software

Gaming

Affective toys

Virtual reality

Pervasive computing

Driverless cars

Figure 9.1 Affective IoT application areas.

opinions, beliefs, contextual enrichment of narratives, and exposition of rationales around balancing short- and long-term goals. That is the difference between operational reporting and the VoT for the various types of feedbackdwhether direct, indirect, and inferred. Another potential stumbling block is that the anthropomorphization of things will likely span multiple departments including CRM, digital workplace, innovation, IT, marketing, and multiple other business units. The ensuing cultural, political, and technical hurdles could all complicate progress. As things become more autonomousdand are better able to take actions independent of humansdthe ability for things to provide feedback to other things will help accelerate their learning and subsequent performance (Davies and Goasduff, 2017). New emotion-sensing technologies and software fueled by artificial emotional intelligence can read and analyze not only skin conductance, breathing, and heart rate but also eye movements, facial expressions, changes in voice, etc. And they do not necessarily require installing expensive hardware, but rather just some recognition software or additional code for computers or smartphones. For example, even slow or uneven cursor movements may reflect distraction or negative emotions of the user. New emotion detection technologies could help employees make better decisions, improve their focus and performance in the workplace, manage stress, and adopt healthier and more productive work styles. Traders are a good example. They tend to overpay for assets and downplay risk in what they call a “bidding frenzy.” To address this problem, Philips and ABN AMRO developed the Rationalizer bracelet back in 2009. While the bracelet measured emotions via electrodermal activity, a display

Affective Internet of Things

205

was reflecting the user’s heightened emotional states. The display thus signaled the need to pause and rethink financial decisions. Some of the world’s elite coaches, teams, and individual athletes have used headsets produced by San Franciscoebased SenseLabs Inc. Their Versus gear connects to an iPhone or iPad via Bluetooth and has dry sensors for assessing brain performance. This makes it possible to identify strengths and weaknesses in problem-solving, multitasking, resource management, decisionmaking, and sleep tendencies. Versus then provides customized exercise protocols to improve mental acuity, concentration, and sleep management. Aggregated data from such devices can help companies understand how internal and external environmental factors impact employees and groups. As a result, they might redesign processes accordingly to help keep personnel better engaged and productive (Slesar, 2018). Emotion AI, also known as affective computing, enables everyday objects to detect, analyze, process, and respond to people’s emotional states and moodsdfrom happiness and love to fear and shame. This technology can be used to create more personalized user experiences, such as a smart fridge that interprets how you feel and then suggests food to match those feelings. In the future, more and more smart devices will be able to capture human emotions and moods in relation to certain data and facts and to analyze situations accordingly. Although emotion AI capabilities exist, they are not yet widespread. A natural place for them to gain traction is in conversation systemsdtechnology used to converse with humansddue to the popularity of virtual personal assistants (VPAs) such as Apple’s Siri, Microsoft’s Cortana, and Google Assistant. Today VPAs use natural language processing and natural language understanding to process verbal commands and questions. But they lack the contextual information needed to understand and respond to users’ emotional states. Adding emotion-sensing capabilities will enable VPAs to analyze data points from facial expressions, voice intonation, and behavioral patterns, significantly enhancing the user experience and creating more comfortable and natural user interactions. Prototypes and commercial products already existdfor example, Beyond Verbal’s voice recognition app and the connected home VPA Hubble (Zimmermann and Goasduff, 2018). Speech-based emotion analysis in real time opens up more business opportunities. This and other emotion-sensing technologies can enable companies to establish deeper emotional connections with their consumers through virtual assistants. Popular VPAs like Siri, Cortana, and Google Assistant use natural language processing and natural language understanding to process verbal commands and questions. Adding emotion-sensing capabilities will enable them to create more comfortable and natural user interactions. Call centers are another potential customer group. Voice-based emotion sensing can enable automated customer service agents to recognize callers’ emotional states and adapt to them. It will also help management analyze stress levels of human workers. In the future, more and more smart devices will be able to capture emotional reactions to certain data and facts, analyze situations accordingly, and come up with appropriate recommendations. Currently, the healthcare and automotive industries are among the most eager to adopt emotion-sensing features. Car manufacturers are exploring the implementation of in-car emotion detection systems to improve road safety by managing the driver’s drowsiness, irritation, and anxiety. For instance,

206

Start-Up Creation

Panasonic Corporation’s new sensing technology can detect a person’s emotions and sense of being hot or cold in a contactless manner. This information can be used for predicting a driver’s drowsiness to help keep them awake. The technology measures a driver’s blinking features and facial expressions captured by an in-vehicle camera and processes these signals using AI. Furthermore, using the data on heat loss from the driver and in-vehicle illuminance, it predicts transitions in the driver’s drowsiness level. Combining this thermal sensation monitoring function, the system helps the driver to stay comfortably awake while driving. When the drowsiness level is high, it issues a sound alarm or a command to rest (Slesar, 2018). Personal assistant robots (PARs) are also prime candidates for developing emotion AI. Many already contain some human characteristics, which can be expanded upon to create PARs that can adapt to different emotional contexts and people. The more interactions a PAR has with a specific person, the more it will develop a personality. Some of this work is currently underway. Vendors such as IBM and startups such as Emoshape are developing techniques to add human-like qualities to robotic systems. Qihan Technology’s Sanbot and SoftBank Robotics’ Pepper train their PARs to distinguish between, and react to, humans’ varying emotional states. If, for example, a PAR detects disappointment in an interaction, it will respond apologetically. The promise of emotional AI is not too far into the future for other frequently used consumer devices and technology, including educational and diagnostic software, video games, and the autonomous car. Each is currently under development or in a pilot phase. The video game Nevermind, for example, uses emotion-based biofeedback technology from Affectiva to detect a player’s mood and adjusts game levels and difficulty accordingly. The more frightened the player, the harder the game becomes. Conversely, the more relaxed a player, the more forgiving the game. There are also in-car systems able to adapt to the responsiveness of a car’s brakes based on the driver’s perceived level of anxiety. In both cases, visual sensors and AI-based, emotion-tracking software is used to enable real-time emotion analysis. These systems will detect the driver’s moods and be aware of their emotions, which in return could improve road safety by managing the driver’s anger, frustration, drowsiness, and anxiety (Zimmermann and Goasduff, 2018). With the help of mood sensor technology, children or elderly family members in need of care will be able to receive timely assistance and support from their families or caregivers. Emotion-sensing wearables will help monitor the state of mind of persons with mental and other health conditions 24/7. When necessary, they will alert doctors and caregivers and inform about upcoming changes in the person’s mood and behavior. Remote emotions detection is possible as well. One of the devices created at MIT’s Computer Science and Artificial Intelligence Laboratory emits radio signals that reflect off a person’s front and back body. By measuring heartbeat and breathing, the device can accurately detect emotional reactions. Such remote sensing technologies could be used to diagnose or track conditions such as depression and anxiety, as well as for noninvasive health monitoring and diagnosis of heart conditions. Technology that deduces human emotion based on audio-visual cues may enable businesses to detect consumers’ positive and negative moods to better understand their preferences, analyze customers’ choices to utilize in marketing, and detect users’

Affective Internet of Things

207

annoyances to improve product usability, etc. For instance, a fridge with a built-in emotion sensor may interpret a person’s mood and suggest a more suitable food. Emotion-sensing smart home devices could provide entertainment (music, videos, TV shows, or imagery) which matches the user’s current state of mind. Video games might use emotion-based biofeedback technology to adjust game levels and difficulty according to the player’s emotional states. MIT Media Lab spinoff Affectiva has been analyzing people’s facial expressions and nonverbal cues for applications in advertising, marketing, and video games for years. But their vision is to build a multimodal emotion AI platform that senses and measures emotions the way humans do. In September 2017, Affectiva announced the release of cloud-based software that identifies the speaker’s gender and observes changes in speech paralinguistics, tone, volume, speed, and voice quality to distinguish anger, laughter, or arousal. IBM along with numerous startups is developing techniques to add human-like qualities to robotic systems. The development of emotional AI will lead to creating more effective PARs. They will be able to distinguish between, and react to, different people and their emotional states. For example, when a robot detects disappointment on the human’s part, it will respond apologetically in a modulated voice. Interacting with a specific person, it will gradually learn emotional awareness. As emotions remain a fundamental need for humans, emotion-sensing technology should start teaching intelligent objects how to interact with humans as soon as possible (Slesar, 2018).

9.2

IoT, Smart Homes, Ambient Intelligence, and Affective Computing

Humans deeply modified their relationships to their housing over the past centuries. Once a shelter was where humans could find protection and rest, their living place became the center of the familydthe expression of their culture. Nowadays, it is a more self-centered place, where individuals develop their own personal aspirations and can express their social position. Electricity was the first technology to enter the home environment, followed by communication technologies to make a human, “a motionless nomad,” connected with others in any place at any time. A new living place is being invented, the “witness” of our existence, perceiving the inhabitants’ rhythms of activities, habits, tastes, and wishes. Among all the services a living place can bring to inhabitants, we find comfort, security, wellness, and health services. The information and communication technologies in homes can now help extend our longevity (Noury, 2014). The world population is aging rapidly with the percentage of older adults increasing to 24% by 2030 from 10% in 2000. Therefore, cost of providing aged care has been growing, especially in countries such as Japan, United States, and Australia. Robotic technology has been identified as being able to help older adults to live independently and is emerging as an innovative approach to assist older adults directly, for example, robotic wheelchairs, and indirectly, for instance, providing support to stakeholders,

208

Start-Up Creation

including caregivers. A systematic literature review of peer-reviewed literature published in Medline, ScienceDirect, ProQuest, PubMed, Scopus, and SpringerLink from January 1, 2000 to mid-July 2015 was undertaken. An initial set of 8533 studies was refined to 58 studies. Nine robot types were identified in addressing aged care problems, including companion, manipulator service, telepresence, rehabilitation, health monitoring, reminder, entertainment, domestic, and fall detection/prevention robots. These robot types have been applied to eight key problem areas in aged care, namely social isolation, dependent living, physical or cognitive impairment, mobility problems, poor health monitoring, lack of recreation, memory problems, and fall problems. The frequency of research into each robot type was analyzed, with the finding that some robotic technologies have received more attention (e.g., companion) while other types that can assist older adults with independent living (e.g., cooking and bathing) were not as comprehensively researched (Shishehgar et al., 2018). The elderly population is increasing and the response of the society was to provide them with services directed to them to cope up with their needs. One of the oldest solutions is the retirement home, providing housing and permanent assistance for the elderly. Furthermore, most of the retirement homes are inhabited by multiple elderly people, thus creating a community of people who are somewhat related in age and medical issues. The ambient assisted living area tries to solve some of the elderly issues by producing technological products, some of them dedicated to elderly homes. One of the identified problems is that elderly people are sometimes discontent about the activities that consume most of their day promoted by the retirement home social workers (Costa et al., 2018). Costa et al. (2018) attempt to improve how these activities are scheduled taking into account the elderlies’ emotional response to these activities. The aim is to maximize the group happiness by promoting the activities the group likes, minding if they are bored due to activities repetition. In this sense, this chapter presents an extension of the Cognitive Life Assistant platform incorporating a social emotional model. The proposed system has been modeled as a free time activity manager which is in charge of suggesting activities to the social workers (Costa et al., 2018). Wilson et al. (2019) describe an integration of robots into smart environments to provide more interactive support of individuals with functional limitations. Robot Activity Support (RAS) system partners smart environment sensing, object detection and mapping, and robot interaction to detect and assist with activity errors that may occur in everyday settings. Wilson et al. (2019) describe the components of the Robot Activity Support system and demonstrate its use in a smart home testbed. To evaluate the usability of RAS, Robot Activity Support also collected and analyzed feedback from participants who received assistance from Robot Activity Support system in a smart home setting as they performed routine activities (Wilson et al., 2019). A home is not only a technical space according to each individual’s role but also a social space where family members interact with each other. However, the number of single-person households has recently shown an exponential increase. At the same time, the smart home technology (SHT) has been growing to provide at-home rest to individuals. In this situation, a home’s role as a social space is diluted, and many people cannot receive the social support they need at home (Lee et al., 2017).

Affective Internet of Things

209

Lee et al. (2017) introduce the concept of social connectedness for the interaction between users and smart home devices. It can be divided into two types. One is the inner social connectedness that is generated through connections between the user and the devices in their smart home. The other is the outer social connectedness that is generated through connections between the user and the smart home devices in other people’s houses. Lee et al. (2017) also introduce two types of interaction. One is the unmediated interaction, in which users interact with each device and the individual device reveals its presence. The other one is the mediated interaction, in which users interact with a single agent that represents various smart home devices. To investigate the impact of both inner/outer social connectedness and mediated/unmediated interaction types, Lee et al. (2017) conducted a controlled experiment using a prototype smart home system. Currently, there are an increasing number of patients that are treated in-home, mainly in countries such as Japan, United States, and Europe. In addition to this, the number of elderly people has increased significantly in the last 15 years and these people are often treated in-home and at times enter into a critical situation that may require help (e.g., when facing an accident or becoming depressed). Advances in ubiquitous computing and the IoT have provided efficient and cheap equipment that include wireless communication and cameras, such as smartphones or embedded devices like Raspberry Pi. Embedded computing enables the deployment of Health Smart Homes (HSH) that can enhance in-home medical treatment. The use of camera and image processing on IoT is still an application that has not been fully explored in the literature, especially in the context of HSH. Although use of images has been widely exploited to address issues such as safety and surveillance in the house, they have been little employed to assist patients and/or elderly people as part of the home care systems (Mano et al., 2016). In the view of Mano et al. (2016), these images can help nurses or caregivers to assist patients in need of timely help, and the implementation of this application can be extremely easy and cheap when aided by IoT technologies. This chapter discusses the use of patient images and emotional detection to assist patients and elderly people within an in-home healthcare context. Mano et al. (2016) discuss few studies that take into account the patient’s emotional state, which is crucial for them to be able to recover from a disease. SHT has been identified as a promising means of helping seniors to remain independent and maintain their quality of life (QoL) while containing spiraling care costs for older people. Despite official pilot schemes in many countries to promote SHT in seniors housing, there is limited understanding of the forms that such SHT interventions should take (Wong et al., 2017). Research by Wong et al. (2017) builds on the analytical model of intelligent building control systems; the aim is to provide a systematic approach to understanding the key intelligent attributes of smart home devices. A qualitative participatory evaluation approach involving focus groups was adopted to investigate the needs of seniors and their SHT preferences (Wong et al., 2017). Pieroni et al. (2015) introduce the concept of Affective Internet of Things (AIoT) where smart objects are empowered with affective capability in terms of abstraction of their emotional state. Moreover, each smart object can be associated with a specific “personality.” This approach, already used in the field of social robotics, mainly

210

Start-Up Creation

exploits robots’ appearance (i.e., anthropomorphism or zoomorphism). The research aims at extending such a paradigm to everyday-life objects to “warm up” the empathic connections that humans generally establish with “cold” gadgets and devices. A new framework for the Affective IoT has been developed: EMPATI (EMPATI Mimics Personalities on Affective Things on Internet). It provides models and functions to simulate different personality for affective objects living in both virtual and real world. Finally, a set of experiments has been conceived to assess the key aspects of the framework in terms of capability to simulate emotional responses depending on the object interaction with the environment and the affective stimuli (Pieroni et al., 2015).

9.3

BIM, Smart and Interactive Buildings

Building Information Modeling (BIM) is a powerful technology that is used to support decision-making about a building during its life cycle. The article shows that traditional BIM solutions because of its static nature do not cover all needs of “smart” buildings technology. Dynamic extension of BIM is proposed to cover gaps of traditional BIM in the design and operational stages of “smart” buildings life cycle (Volkov and Batov, 2015). Hoseini et al. (2017) developed the nD BIM Integrated Knowledge-based Building Management System (BIM-IKBMS) for inspecting post-construction energy efficiency to advance the successful implementation of sustainable building performances. Ciribini et al. (2017) analyzed users’ behaviors through real-time information in BIMs. An intelligent building supports the needs of its occupants by data analytics. Nowadays, buildings are evolving from being products to become effective service providers for end users: thus, occupancy topics become crucial. Ciribini et al. (2017) focuses on building operations, pointing out how advantages in supporting the needs of users could be derived through the implementation of Building Management Systems (BMS) into a BIM environment, connecting realtime information collected by sensors to a BIM database (Ciribini et al., 2017). The IoT application domains empower the vision of a built environment pervaded by sensors and actuators in which homes do not waste energy, where interactive walls display useful information, as well as pictures of art or videos of friends. Even more potentialities could be exploited through data collection, considering that the connected devices have an annual growth more than 10%, and over 500 billion connected devices are expected worldwide by 2025 (Cisco Systems. Inc. Annual Report, 2013, 2013). Nowadays, several buildings are built from the ground up with nearly one IoT-enabled sensor per square meter monitoring temperature, humidity, the weight in the trash cans, how many people are in a room, and so on (Ciribini et al., 2017). It has been estimated that users waste 30% of energy in buildings because of their behavior (Brown et al., 2012). Anyway, the occupant variable and the behavior tracking are crucial to define an operational rational use and tailored services on the real needs of users, avoiding wastes of energy (European Commission, 2014a,b) in a lean vision of the buildings management (Miller and Schlueter, 2013). Analyzed

Affective Internet of Things

211

information collected during the operational stage could enlighten end users about the behavior of both buildings and occupants. Therefore, advantages in tracking the behavior of occupants and in satisfying the needs of users should be derived through the availability of real-time information (e.g., data collected by sensors measuring and reporting outdoor conditions, indoor comfort parameters, system efficiency factors). Later, predictive buildings anticipated the occupancy needs and set themselves to face environmental and behavioral inputs using Information and Communications Technology (ICT) to support managers and operators. Nowadays, cognitive buildings learn from the user behavior and traduce the data coming from the outdoor, the indoor, and the social environment using an IoT approach. In this way, the responsiveness is reset in time, making the building autonomous to react in some situation (Ciribini et al., 2017). Within this scenario, user behavior could be tracked to define customized operations in which the building measures the number of people inside and adjusts heating and lighting accordingly, turning an empty building off, as a computer goes into standby mode. Moreover, it is possible to localize the heating and cooling systems, providing a detailed, individual climate for each user by means of arrays of responsive infrared heating elements that are guided by sophisticated motion tracking providing thermal “clouds,” following people through spaces and ensuring pervasive comfort while improving overall energy efficiency. By adequately processing these data, it is possible to assess building performances, to evaluate user levels of satisfaction, to estimate occupant preferences, or to track user behaviors (Ciribini et al., 2017). The research aims to define a workflow to populate BIM models using data gathered through remote sensors, driving parameters in BIM models, changing parameters in digital models to provide input, and possibly modifying physical models. In this way, users become aware of their behavior and should interact with buildings, i.e., through online dashboards or apps, improving their behavior and increasing their awareness. Moreover, designers benefit of an improvement of the building process not only collecting and filtering feedback of users in operation but also checking and verifying instantaneous and historical values of defined parameters. Finally, facility managers are instantly informed about failures or damages and the process can support rapid fault detection (Ciribini et al., 2017). Through ad hoc apps, it is possible to access sensors data, retrieved from the BMS or directly from the sensors through the Z-wave gateways, and to provide feedback of the students on comfort level in the classrooms, interacting with the building. In this way, it should be possible to develop strategies such that buildings could adapt their behavior depending on the user needs, communicated via app. The bidirectional interaction through the app embodies the introduction of the human factor into the IoT structure to enable the cognitive building to learn from behaviors providing data in real time with the capability to process them into adaptive and predictive strategies for improved comfort and servitization. The scenarios are created with data gathered through sensors installed into the building. As an example, in the scenario of the school, when a sensor gives feedback that the air quality in the classroom is getting worse, ventilation will be triggered and the room will improve its air quality. Cognitive buildings are also highly feasible (Gr€ unkranz, 2007) as most modern buildings have

212

Start-Up Creation

already a series of sensors implemented in them when they are finished (Curry et al., 2012; Khan and Hornbæk, 2011). The idea is to introduce the user in the loop of information and connect the body of knowledge about the building. Objective data coming from sensors and subjective data coming from students and visitors can be collected directly, i.e., by the user definition of the comfort conditions, and indirectly, i.e., through the sentiment analysis (Montoyo et al., 2012). As an example, data could be gathered through sensors, could be encoded in language (e.g., textbooks, formulas, conversation), or could be captured in sight, sound, and motion (Keinan, 2015). By adequately processing these data, it is possible to assess building performances, to evaluate user levels of satisfaction, to estimate occupant preferences, or to track user behaviors. Through BIM models, it is possible to transform collected data in useable information to gain deeper insights on how buildings perform throughout their life cycle. In this way, users become aware of their behavior and should interact with buildings, i.e., through online dashboards or apps, improving their behavior and increasing their awareness (Ciribini et al., 2017). Distributed, networked, electronically tagged, and interactive devices are increasingly incorporated into the physical environment blurring progressively the boundary between physical and virtual space. This changing relationship between physical and virtual implies not only a change in the operation and use of buildings but also a change in their physical configuration and therefore their design and production. Interactive building addresses, therefore, both the building defined as physically built environment and the building process implying on the one hand the changing role of architecture with respect to incorporation of interactivity and the resulting multiple and varied use of built environments in reduced timeframes. On the other hand, it is implying the changing role of the architect with respect to the use of networks connecting digital databases and parametric models with customizable design and production tools allowing for linking design to production and use (Bier, 2012). To raise awareness of the role of BIM in improving energy efficiency and comfort conditions, the work introduces a strategy of combining building simulation tools and optimization methods. Furthermore, it emphasizes the fact that a combination of these strategies with BIM can not only improve the construction process but also enable exploration of alternative approaches. The work discusses the potential application of data integration methodology for an office environment and focuses on the review of the potential performance of integrated systems. It also explains how BIM can help facilitate review of results and methods for improving building performance in terms of energy efficiency and indoor environmental quality (IEQ) (Habibi, 2017a,b). Most BIM systems serve designers well up until now but will have to evolve toward a more user-centered design, focusing on interactive spaces rather than focusing on digital representation. They are lack of information needed to create a virtual environment which can interact with users. Such problems will become more prominent in the case of smart spaces where the environment reacts to users’ activity. There are no sufficient tools to design and represent real usage of smart space. A task-based interaction is proposed to apply Smart BIM in a design process. Smart Design systems help end users to experience their daily activity in a virtual environment and understand the space reactions. It can be used as a toolset to improve communications among users

Affective Internet of Things

213

and designers in design processes especially in the design of smart environments. Eventually, it is expected that Smart BIM will lead to match smart technology usability with users’ demands. Hence, the prototype gives the opportunity of evaluating users’ attitude and expressions toward an interactive and responsive BIM (Heidari et al., 2014). Intelligent management systems have significant potential for energy savings, but they have not been fully used in buildings and cities. Smart sensor systems based on user behavior will improve IEQ and user comfort. This work aims to reduce energy consumption and provide comfort conditions by learning user behavior. To improve energy efficiency and comfort conditions, smart sensor systems and digital simulation tools play a crucial role in finding optimal solutions to optimization problems (Habibi, 2016). This work explores the application of a real-time monitoring system to achieve optimal IEQ. ICT-related applications have drawn attention from smart buildings as potential means of providing correlations between users and building systems to improve energy efficiency and comfort. To investigate whether users can take advantage of natural environmental factors during occupied hours in office buildings, daylight and energy performance simulations were carried out. This work explores users as the primary factors to improve IEQ and energy efficiency. The results support the use of real-time monitoring systems in office buildings. It seems, however, that there is a need for individual user control of thermal, ventilation, and lighting (Habibi, 2016). Within the construction industry, accident statistics indicate that there are fatalities and serious injuries in confined spaces due to exposure to hazardous environment. Confined Space Monitoring System (CoSMoS) is designed to improve construction safety (Riaz et al., 2014). The prototype system uses BIM to present data received from wireless sensors placed at confined spaces on a construction site. Industry feedback on the prototype indicates that the proposed solution will facilitate intelligent monitoring of confined spaces through real-time sensor data to avoid time sensitive emergency situations typically encountered by workers operating in such work environments (Riaz et al., 2014). This research presents the architecture of a technology platform capable of integrating different types of data from building sensors and providing an interface to manage and operate facility devices, which is supported by advanced optimization algorithms. This interface is potentiated by a BIM-based interface presenting real-time data of the building. The solution, called 3i buildingsdIntelligent, Interactive, and Immersive Buildings, is a tool to monitor and manage smart buildings, as well as optimize users experience, energy consumptions, and environment quality. This is achieved by a grid of sensors and devices that continuously gather information (structural conditions of the building, occupancy, comfort of occupants, energy consumptions and CO2, humidity levels, etc.), which is processed by predictive models able to learn over time. The 3D representation of the models allows managers to take advantage of the virtual environment by augmenting the facility model and including information about the facility, making it easier and perceptible to users and owners and helping them to make better decisions. These types of systems might help reducing energy consumptions as well as increasing comfort and satisfaction of occupants,

214

Start-Up Creation

maintaining a constant concentration of CO2 and humidity within the facility. The optimized algorithms will allow the system to learn, predicting and reacting to different conditions, giving a more reliable and smooth response to occupants’ needs (Costa et al., 2015). Current urban water research involves intelligent sensing, systems integration, proactive users, and data-driven management through advanced analytics. Such research would pave the way for demand-side management, active consumers, and demandoptimized networks, through interoperability and a system-of-systems approach. The web service integrates state-of-the-art sensing, data analytics, and middleware components. We propose an ontology for the domain which describes smart homes, smart metering, telemetry, and geographic information systems, alongside social concepts. This integrates previously isolated systems as well as supply and demand-side interventions, to improve system performance (Howell et al., 2017). Building energy management systems (BEMS) are integrated building automation and energy management systems, utilizing IT or ICT, intelligent and interoperable digital communication technologies promoting a holistic approach to controls and providing adaptive operational optimization. The system may have multiple levels from individual sensors and actuators to users’ interface, to facilitate data collection, analysis, diagnose, trend finding, and decision-making. BEMS dynamically control indoor climate in a cost-effective manner and ensures the comfort, safety, and wellbeing of the occupants in buildings (Yang et al., 2017). The ability to process large amounts of data and to extract useful insights from data has revolutionized society. This phenomenonddubbed as Big Datadhas applications for a wide assortment of industries, including the construction industry. The construction industry already deals with large volumes of heterogeneous data; which is expected to increase exponentially as technologies such as sensor networks and the IoT are commoditized. In this paper, we present a detailed survey of the literature, investigating the application of Big Data techniques in the construction industry. We reviewed related works published in the databases of American Association of Civil Engineers (ASCE), Institute of Electrical and Electronics Engineers (IEEE), Association of Computing Machinery (ACM), and Elsevier Science Direct Digital Library. While the application of data analytics in the construction industry is not new, the adoption of Big Data technologies in this industry remains at a nascent stage and lags the broad uptake of these technologies in other fields. This paper fills the void and presents a wide-ranging interdisciplinary review of literature of fields such as statistics, data mining and warehousing, machine learning, and Big Data Analytics in the context of the construction industry (Bilal et al., 2016). Buildings are key players when looking at end-use energy demand. It is for this reason that during the last few years, the IoT has been considered as a tool that could bring great opportunities for energy reduction via the accurate monitoring and control of a large variety of energy-related agents in buildings. However, there is a lack of IoT platforms specifically oriented toward the proper processing, management and analysis of such large and diverse data. In this context, we put forward in this paper the IoT Energy Platform (IoTEP) which attempts to provide the first holistic solution for the management of IoT energy data. The platform support for data analytics. As

Affective Internet of Things

215

part of this work, we have tested the platform IoTEP with a real use case that includes data and information from three buildings totalizing hundreds of sensors (Terroso-Saenz et al., 2019). Due to the complexity and increasing decentralization of the energy infrastructure, as well as growing penetration of renewable generation and proliferation of energy prosumers, the way in which energy consumption in buildings is managed must change. Buildings need to be considered as active participants in a complex and wider district-level energy landscape. To achieve this, the authors argue the need for a new generation of energy control systems capable of adapting to near real-time environmental conditions while maximizing the use of renewables and minimizing energy demand within a district environment. They could provide energy management and cost savings for adaptable users, while meeting energy and CO2 reduction targets (Reynolds et al., 2017).

9.4

Modern office smart systems

Some researchers have proposed asking officemates to basically vote on what the temperature should be. Using a phone app or website, building occupants say whether they are too hot or too cold and what would make them more comfortable. An algorithm then analyzes the groups’ answer and calculates a temperature estimated to be most acceptable to most people. In previous research, our group placed multiple temperature sensors around an office and combined their data with information from wristbands that sensed occupants’ skin temperature and heart rates and apps that polled workers about how they felt. We found that adding the data about how people’s bodies were reacting made the algorithm more accurate at calculating the room temperature at which people occupying a given space would feel most comfortable. Our current project seeks to make things even easier and less intrusive for people, eliminating the wristbands and apps, and only using remote sensing of people’s skin temperature to measure how comfortable they are. We developed a method using regular cameras, thermal imaging, and distance sensors to detect occupants’ presence in a space, focus on their faces, and measure their skin temperature. From that data, our algorithm calculates whetherdand howdto change the temperature in the room regardless of the number of occupants in the space. When we tested it in an office occupied by seven people, they complained less about feeling uncomfortably cold or warm (Menassa et al., 2019). Smart heating, ventilation, and air conditioning (HVAC) technology reduces energy costs, lessens the workload on facilities staff, and provides better comfort conditions for employees.

Occupancy sensors Occupancy sensors are useful for office environments (like most) that do not have uniform usage all the time. Increasingly mobile workers are leaving desks and conference

216

Start-Up Creation

rooms empty as much as 50%e60% of the time. Meanwhile, you are heating and cooling space for people who are not there. Occupancy sensors detect the presence of people (typically by detecting motion) currently using individual spaces within an office. That data can be used to adjust temperatures based on real-time utilization, saving you money on energy consumption. While your HVAC system consumes anywhere from 40% to 70% of your building’s energy usage, electricity for lighting is also a huge expense. That figure can be 25% or more. In addition to controlling a smart HVAC system, occupancy sensors also control lighting to further reduce lighting costs.

Thermal sensors Strategically placed thermal sensors can detect the differences in conditions in each zone of your space. For example, a crowded conference room can get warm in a hurry, while an open office area with high ceilings can get chilly (because warm air rises and people are closer to the floor). A smart HVAC system uses that data to adjust to changing conditions throughout the day or week.

CO2 sensors CO2 sensors can detect the levels of CO2 gas in a space, which can increase to undesirable levels as occupancy increases. When the threshold is reached, a smart HVAC system can increase levels of fresh air supplied to the space. This technology can have a significant impact on workforce well-being (Morley, 2019). The smart sensors, including mobile phone, wearable device, and other sensors, are introduced. They are the key elements to determine human intentions. Wearable devices, such as watches or bracelets, may be adopted for detecting the human sleeping state as the feedback signals of the sleeping function. It can collect human motion information and feedback to the smart air conditioner for further control. Smart control, based on the information collected by the use of mobile phones and wearable devices, intensifies the interaction with occupants and carries out the intention causing control (Cheng et al., 2014): (1) Mobile phones with GPS and personal schedules for detecting the occupants’ position and intentions could foresee the occupants’ intention of entering the enclosed space. At this moment, the compressor, which is off in the general situation, could turn on in the full power. Before entering, the circulating fan turns on at the highest speed, and the air deflector swings for 10 min to enhance the air circulation. Therefore, smart control may enable the enclosed space and could be cooled down rapidly after the occupant enters. (2) The bracelet with the accelerator could detect the movement of occupants while sleeping. After the occupant falls into a deep sleep, the air conditioner would lift the indoor temperature flexibly to avoid energy consumption. The smart air conditioner could adjust the compressor output actively according to the occupants’ active intention (going home) and passive one (falling into a deep sleep) for the goals of human comfort and energy conservation.

Affective Internet of Things

217

One such system, Comfy, integrates with an office’s HVAC system. It allows employees to make requests from their smartphone or web browser to have the office space warmed or cooled. The system also makes employee requests visible to everyone else in their heating and cooling “zone”dwhich subtly encourages compromise and communication between employees who might not see eye to eye. With this type of technology, employees get the instant gratification of having their voice heard. Over time, the software analyzes usage habits for each occupant and “learns” workday patterns (for example, when employees arrive and leave for the day). The system then begins to automatically tailor heating and cooling flows accordingly, while optimizing them to be as efficient as possibledresulting in less dramatic fluctuations in office temperature, which can help companies save money. One interesting note might explain many office squabbles: Women like it hot; men like it Hoth. The median preferred temperature for men is 70F, compared to 72F for women. Among 18e25-year-olds and 26e35-year-olds, only 32% and 34%, respectively, express frequent dissatisfaction (several times a week or more) with their office’s temperature. Compare that to dissatisfaction rates among the 46e55-year-old bracket, 69% are frequently dissatisfied. The same technological solutions suggested for bridging the gender divide could be used to resolve these differences between the ages: provide different temperature “zones” throughout the officedperhaps in the form of a digital “heat” mapdand allow employees to work where they are most comfortable (Burnson, 2015). This system enables users to determine the minimum and maximum conditions for ensuring the best estimated indoor air quality (IAQ) while a building under examination is in the design stage. With the simulator, a user can have detailed information by clicking links for the rooms of the graphical output. Some important information about a classroom is presented at the graphical interface, such as open/closed windows, door status, instant temperature, humidity, current student number, predicted CO2 and O2 ppm values, minimum outdoor air ventilation requirement, and calendar information. To improve the prediction capability, besides their quantity, the characteristics of the occupants are also added to the model, such as their physical activity, body weight and height, and time spent in a classroom. For example, CO2 estimations calculated by the model and the number of students in the classroom/corridor that comes from the real course schedule of the department can be seen as a function of time. The statuses of the door/windows (open/closed) are also considered in the model (Yalcin et al., 2018). Sensor and actuator technologies based on ubiquitous computing and wireless sensor networks (WSN) have been employed in attempts to implement responsive environments. The office at Xerox PARC is one of the examples of such responsive environments, where electric outlets, HVAC systems, and lightings were automatically controlled in response to the occupants’ preferences (Elrod et al., 1993). Pan et al. developed an intelligent light control system based on WSN in indoor environments (Pan et al., 2011). They showed that the proposed system can determine the proper illuminations of devices to achieve the desired optimization goals depending on the illumination requirement according to the user activities and profiles. Much effort has been also devoted to developing smart heating systems using smart thermostat and occupant behaviors. Gao and Whitehouse (Gao and Whitehouse, 2009) claimed that large potential energy savings would be possible without sacrificing the occupant’s

218

Start-Up Creation

comfort only if setback schedules are defined correctly. They introduced a selfprogramming thermostat that automatically creates an optimal setback schedule by sensing the occupancy statistics of a home and also allow the occupants to select. The experimental results show that the method can reduce heating and cooling demand by up to 15% over the default setback schedule recommended by EnergyStar (Yun and Won, 2012). However, researchers at Concordia University may have found a solution to this problem: A system that automates the control of indoor environmental conditions and optimizes both individual workers’ productivity and energy consumption. The system optimizes indoor environmental conditions including air quality, temperature, and lighting based on the preferences of each office worker. The researchers created a mathematical model of the preferences of each office worker to simulate worker preferred indoor temperatures, ventilation rates, natural light, and artificial lighting based on sensors places throughout the office (Borkhataria, 2017). The optimization uses the personal satisfaction curves for all occupants to determine the temperature settings in each office. This optimized “Have-It-Your-Way” (HIYW) system improves occupant’s comfort while reducing energy consumption. Because occupants remain thermally comfortable within a certain temperature tolerance that varies from one individual to another, the results of this approach, which takes advantage of the varying thermal comfort tolerances of the occupants, are quite encouraging. The HIYW approach would use all the sensor network connectivity in the building (Ari et al., 2005).

9.5 9.5.1

Affective BIM4Ren Analysis of patents and systems

Many scientists have also done researches in the field of individual thermal comfort and IAQ (Kim et al., 2018; Li et al., 2018, 2019; Liu et al., 2007; Wang et al., 2020; Cao et al., 2014; Zhang et al., 2010; Jung and Jazizadeh, 2019; Cottafava et al., 2019; Zhai et al., 2019; Lu et al., 2019; Kim and Hwangbo, 2018). An overview of patent and systems analysis is provided in Fig. 9.2. Some of them are briefly described below. Kim et al. (2018) employ machine learning to predict individuals’ thermal preference. Kim et al. (2018) claim that personal comfort models based on occupants’ heating and cooling behavior can effectively predict individuals’ thermal preference and can therefore be used in everyday comfort management to improve occupant satisfaction and energy use in buildings. Liu et al. (2007) developed a neural network evaluation model for individual thermal comfort based on the backpropagation algorithm. Compared with the experimental data from the human thermal comfort survey, the evaluation results showed a good match with the subject’s real thermal sensation, which indicated this model can be used to evaluate individual’s thermal comfort, rightly (Liu et al., 2007).

(Morley, 2019)

(Cottafava et al., 2019)

(Menassa et al., 2019)

(Morley, 2019) (Cheng and Lee, 2014) (Menassa et al., 2019)

(Cottafava et al., 2019).

(Ari et al., 2005).

(Huang, 2010)

Affective Internet of Things

(Cheng and Lee, 2014)

Developed Patents And Systems (Huang, 2010) (Ari et al., 2005). (Nikovski, 2016) (Menassa et al., 2019) (Burnson, 2015) (Wang et al., 2020)

(Menassa et al., 2019)

(Kim and Hwangbo, 2018) (Wang et al., 2020)

(Nikovski, 2016).

(Burnson, 2015).

(Levy and Betz, 2001) (Nikovski, 2016) (Kim and Hwangbo, 2018)

(Yalcin et al., 2018) (Levy and Betz, 2001). (Nikovski, 2016).

(Yalcin et al., 2018).

219

Figure 9.2 An overview of patent and systems analysis.

220

Start-Up Creation

Wang et al. (2020) evaluated a novel approach to personal comfort systems that leverage the time dependence of human thermal perception. A 6.25 cm2 wearable device, Embr Wave, delivers dynamic waveforms of cooling or warming to the inner wrist. The results indicate that this low-power wearable device improves wholebody thermal sensation, comfort, and pleasantness (Wang et al., 2020). Jung and Jazizadeh (2019) have investigated the impact of personal thermal comfort sensitivitiesddistinct individual reactions to temperature variationsdon collective conditioning. They proposed an agent-based control mechanism to simulate the multioccupancy space, controlled by an HVAC agent to provide air conditioning for multiple human agents using three operational strategies to compare conventional strategies with proposed approach. Researchers’ investigations demonstrated that thermal comfort sensitivity plays a statistically significant role in collective conditioning as it resulted in changes of temperature setpoint in 86% of cases and a higher probability of achieving collective comfort (Jung et al., 2019). ComfortSense aimed at decoupling energy demand from indoor comfort (Cottafava et al., 2019). Cottafava et al. (2019) approachdwhich was multidisciplinary and included the contribution of sociologists, physicists, and computer scientistsdwas based on IoT technologies, on a Living Lab design and testing process, and on a crowdsensing approach. With ComfortSense, users send a feedback about thermal comfort. If the negative feedback is received and, due to other negative feedback previously received, plans are to reduce the temperature by 1 C, increase the comfort, and reduce the energy consumption. Cottafava et al. (2019) also developed three Direct Virtual Sensors (DVS) to predict (1) the global, (2) the thermo/hygrometric, and (3) the air quality comfort. Each DVS was designed to predict future users’ feedback from a few environmental   objective measurements as described by the following equation, yðt þ1Þ ¼ f uðtÞ , where yðt þ1Þ is the output (i.e., the comfort feedback) at time tþ1, f is a nonlinear function, and uðtÞ is the array of the average values of the environmental variables (input) at time t. More precisely, each DVS needs the following variables as input: (1) temperature, relative humidity, and CO2 (global comfort), (2) temperature and relative humidity (thermo/hygrometric comfort), and (3) temperature, humidity, and CO2 (air quality comfort). Thus, for instance, the general comfort DVS equation is described by yðt þ1Þ ¼ f ðu1 ðtÞ; u2 ðtÞ; u3 ðtÞÞ, where ui represents the average value of temperature (u1), relative humidity (u2), and CO2 concentration (u3) at time t (Cottafava et al., 2019). Lu et al. (2019) develop a thermal comfort model with RP 884 of three major climate zones based on k-nearest neighbor, random forest, and support vector machine. During the experiment, the researchers also changed the temperature at 1 C by analyzing a thermal comfort model. The results have shown that the best recall of the statistical thermal comfort model is 49.3%, which outperforms that of predicted mean vote (PMV) being 43% based on 7-point thermal sensation scale. In addition, the Q-learning-based temperature control can indeed reach the comfortable temperature ranges for occupants with whatever initial temperature setpoint (Lu et al., 2019). Patent analysis of methods (Huang, 2010; Nikovski, 2016; Feldmeier, 2012; Lee et al., 2016; CN107120782A, 2017; CN108413588A, 2018; Laftchiev, 2019; Levy and Betz, 2001) and systems (Huang, 2010; Karimi et al., 2014; Nikovski, 2016;

Affective Internet of Things

221

Feldmeier, 2012; Lee et al., 2016; CN108413588A, 2018; Laftchiev, 2019; Levy and Betz, 2001; Levy and Betz, 2006; CN103062871B, 2013; CN105258308A, 2015) has also been performed. The patented methods are briefly described below. Huang (2010) environment controlling method provides a central processing equipment, obtains physiological and environmental information by means of said personal physiological measurement equipment and said environment measurement equipment, decides an optimum environmental condition on the basis of said physiological, environmental, and health information, transmits regulation information, and regulates environmental conditions by environment controlling equipment (Huang, 2010). Nikovski (2016) patented a method for personalizing an HVAC system for an occupant in an environment, comprising steps such as (1) obtaining biometric data of the occupant and measuring continuously environmental data in the environment as current conditions; (2) adapting continuously an estimate of a comfort index of the occupant based on the current conditions; and (3) controlling the HVAC system based on the estimate of the comfort index to personalize the HVAC system, wherein the steps are performed in a processor (Nikovski, 2016). Lee et al. (2016) patented a method for controlling temperature and humidity by a temperature and humidity control device. It includes acquiring at least one piece of environmental information and user biometric information, determining based on the acquired at least one piece of the environmental information and the user biometric information, control information that determines statistical information to be within a certain range, and controlling an HVAC system based on the determined control information (Lee et al., 2016). CN107120782A (2017) invention provides a heating and ventilating system control method based on multiple-user thermal comfort data. The method comprises the steps that user thermal comfort data are obtained according to current season information fed back by users, the current user movement states, and thermal comfort preference; corresponding user thermal comfort preference curves are obtained according to the user thermal comfort data; the thermal comfort probability distribution curves of cold, hot, and comfort are obtained according to the user thermal comfort preference curves; a multiple-user thermal comfort probability distribution curve at different indoor environment temperature is obtained according to the thermal comfort probability distribution curves of all users; and the comfort temperature interval of the multiple-user thermal comfort probability distribution curve is used as a selection interval of temperature set values, and the optimal temperature set value of a controlled thermal space is obtained according to the corresponding relation of the air supply volume and the temperature set value. Scientists provided a curve for thermal comfort probability distribution for the user (Eq. 9.1) (CN107120782A, 2017): Pn

Probagg ðTin Þ ¼

j¼1 Probj ðTin jSth ¼ C; bÞ P max nj¼1 ProbðTin jSth ¼ C; bÞ

(9.1)

where a represents a number of users of the hot space, C represents each person in the room cool, partial thermal comfort three kinds of comfort model “comfort” category

222

Start-Up Creation

corresponding to the model, indicating that the b parameter model of comfort, Sth representation, Tin represents the indoor temperature, Probagg output name, j denotes the number of person in the room (CN107120782A, 2017). CN108413588A (2018) patents is a personalized air-conditioner control system and method based on thermal imaging and BP neural network. Patented method is based on thermal imaging and BP neural network, is characterized including following steps: (1) by the regular typing of user and more new individual essential information, and carry out the Real-time Feedback of hot comfort, institute’s typing information is used In the corresponding evaluation index such as calculating BMI and infrared thermal imaging data is instructed to acquire; (2) infrared thermal imaging module carry out thermal imaging data acquisition; (3) carries out the conversion of Infrared Thermogram and temperature field data; (4) is directed to the temperature data points of different user by the extraction of temperature field data according to user’s typing information; (5) carries out BP neural network training using user as unit to input layer data; (6) obtains the control strategy of air-conditioning system by data analysis; (7) air-conditioning system automatic controller receive the control signal for coming from message processing module, and to air-conditioning system end End equipment carries out automatically controlling (CN108413588A, 2018). Laftchiev (2019) developed method for controlling an operation of a set of devices for an occupant which use input devices to accept inputs from a plurality of humans, sensors to take sensor measurements, the sensor measurements including measurements of temperature, processor, and actuator to cause in accordance with the control signals, mechanical motion of one or more objects to alter air flow. Huang (2010) environment controlling system integrates and analyzes an individual’s physiological and health information as well as environment information on a real-time basis to control environmental conditions and determine a living space beneficial to personal health. A healthy living space suitable for home care and disease management can be established by controlling environmental factors such as temperature, humidity, light, sound, and so on (Huang, 2010). Karimi et al. (2014) developed humanebuilding interaction framework for personalized comfort-driven system operations in buildings. This system may provide control information for controlling how an environmental control system controls an environment within a building. The computer data processing system may receive and store reports from multiple users and/or may receive and store reports at different times from a user. Each report may provide information concerning how the user perceives the comfort level of the user’s environment at the time the user supplies the information. The computer data processing system may determine and generate the control information for controlling how the environmental control system controls the environment based on the information concerning how each user perceives the comfort level of the user’s environment at the time each user provides the information. In addition or instead, the computer data processing system may determine and generate such control information based on the information concerning how a user perceives the comfort level of the user’s environment at the different times the user supplies the information (Karimi et al., 2014).

Affective Internet of Things

223

The system proposed by Nikovski (2016) consists of a wearable device (configured to obtain biometric data and a comfort level of the occupant and measuring continuously environmental data in the environment as current conditions), a processor (configured to adapt continuously an estimate of a comfort index of the occupant based on the current conditions), and an HVAC system that is controlled according to the estimate of the comfort index (Nikovski, 2016). Feldmeier (2012) developed control apparatus for an HVAC system which provides personalized comfort control. It can adjust local conditions in different rooms within a building to maximize the perceived comfort of individual occupants. The control apparatus locates individuals within a building. For each individual, it senses temperature, humidity, and other parameters at the individual’s location, calculates a comfort metric indicative of the user’s comfort, and can control the flow of chilled or heated air to the individual’s location to adjust local conditions to maximize the individual’s comfort (Feldmeier, 2012). Lee et al. (2016) patented device for controlling room temperature and humidity. It is possible to provide a comfortable environment to a user and save energy while maintaining comfort. The present disclosure relates to a sensor network, machine-type communication, machine-to-machine communication, and technology for IoT. The present disclosure may be applied to intelligent services based on the above technologies, such as smart home, smart building, smart city, smart car, connected car, health care, digital education, smart retail, security, and safety services (Lee et al., 2016). CN108413588A (2018) patented personalized air-conditioner control system based on thermal imaging and BP neural network. System includes humanecomputer interaction module, thermal imaging module, and message processing module and passes through BP nerves network technique, which is calculated, optimizes air-condition system control parameter, air conditioning control module for receiving transmission signal and realizing to air-conditioning (CN108413588A, 2018). Levy and Betz (2001) invention involves the personal air conditioning of individual workstations in an open-office space layout. The individual workstation’s air is supplied by a major air plenum located under a horizontal surface of the workstation. The conditioned air is directed by a smaller self-contained air terminal located under a floor representing a larger major air plenum or chamber. The conditioned air is supplied to the individual workstations at or near the atmospheric pressure. The multiple of smaller air terminals are the movers of the conditioned air by way of driving fans installed therein and activated as the need arises. The conditioned air is moved from the smaller air terminals by flexible air tubes to the air plenum mounted under the desk surface. A person situated at the workstation can control the direction of air emanating from the front of the personalized air outlet plenum toward the person in multiple directions. Furthermore, the person can also control the volume of the personal air by being able to divert some of the air away from the person through a wall in the desk or through a wall of a room partition to an adjoining space. The person at the workstation has the option of dividing the main air stream either to a frontal outlet directed at the person or to an outlet away from the person to enter the general atmosphere of the work space (Levy and Betz, 2001).

224

Start-Up Creation

Levy and Betz (2006) objective of the invention is to present a system for distributing conditioned air throughout an office layout in a most efficient way. In a building whether large or small, different people have different levels of metabolism and therefore different comfort needs. Personalized air conditioning/displacement ventilation system incorporated in a standalone unit, said system is installed on a floor having an air plenum below said floor but above a concrete slab, a supply of conditioned air is located in said plenum and is moving air into a flexible air duct, said standalone unit consists of an upstanding chamber being connected to said flexible air duct, said chamber having various controls therein to control a flow of air either to a front of said chamber or to a lateral side of said chamber into the ambient atmosphere surrounding said chamber (Levy and Betz, 2006). CN103062871B (2013) invention relates to an air conditioning control system based on the measured skin temperature, including infrared thermometer, the rotating bed, telescopically foldable stand, the orientation controller infrared thermometer, airconditioning controller Temp, rubber hoses and gaskets, infrared thermometer orientation of the controller are connected with an infrared thermometer, base, airconditioning controller Temp, infrared thermometer mounted on the base, the bracket fixed to the wall above the bed or table mounted on the desk, rubber a gasket mounted between the base and the bracket, respectively, air-conditioning controller Temp infrared thermometer, infrared thermometer orientation controller, room air conditioner or air conditioning personalized connected (CN103062871B, 2013). CN105258308A (2015) invention discloses a personalized ventilation control system suitable for civil buildings and vehicles. The personalized ventilation control system comprises an air conditioner air supply opening arranged in a peripheral region of a seat. By means of the personalized ventilation control system, the energy utilization efficiency of personalized ventilation can be improved, the heat comfort of the human body is met, energy saving of the air conditioner system is achieved, and meanwhile the requirement for comfort of users is met, and the energy saving function is achieved (CN105258308A, 2015).

9.5.2

Description of the affective BIM4Ren

The analysis of existing IoT provides the basis for the development of the intelligent decision support and affective computing systems containing an Affective BIM4Ren for determining the most efficient housing renovation, real-time thermal comfort, and IAQ versions among many. The developed Affective BIM4Ren consists of an HVAC system, a database, database management system, sensor subsystem, model base, model base management system, and user interface. The Affective BIM4Ren heats or cools air in rooms meant to accommodate numerous individuals. The Affective BIM4Ren focuses mainly on individual thermal comfort (temperature, humidity) and IAQ (carbon monoxide, carbon dioxide, particulates, oxygen, and such). The system provides personalized air for the people engaged at their workplaces and chairs.

Affective Internet of Things

● ●

225

Collecting information prior to the renovation for characterizing the existing building before renovation (xbij) and occupant expectations (xeij) Collecting the information after the renovation (take part in the assessment by occupants of the work delivered, xaij) Determining overall occupant satisfaction (happiness) level (HSj)

Performing a multivariate design and multiple criteria evaluation of alternative bldg. Refurbishing projects to select the most beneficial per occupant expectations of renovation alternatives alternatives

● Providing rational real-time personalized thermal comfort and indoor air quality in different rooms and zones ● Providing real-time personalized lighting/illumination, film, music, etc. ● Providing digital recommendations for improving renovation projects

Comparing overall occupant satisfaction (happiness) levels (HSj) with the country's happiness ranking/score (Hi)

Affective BIM4Ren

Determining the market (VMj ), integrated, utilitarian and hedonic (VUHj), emotional (VEj), occupant-perceived (VPj) and investment (VIj) values of pilot site j under deliberation

● Optimizing the selected KPI to make the pilot sites under deliberation equally competitive on the market compared to the other renovation projects under comparison ● Calculating the KPIs for the pilot sites under deliberation for determining the best project ● Collecting information after renovating (occupants assess the work accomplished (xaij)

Figure 9.3 Main functions the developed Affective BIM4Ren can perform.

Nine databases constitute the database of an Affective BIM4Ren (see Fig. 9.3): • • • • •

• • •

Database of tables assessing renovation solutions Database of tables of multivariant design Database of different rooms and zones Database of thermal comfort (temperature, humidity) and IAQ (carbon monoxide, carbon dioxide, particulates, oxygen, and such) in different rooms and zones Database of people’s emotional states (happy, sad, angry, surprised, scared, disgusted, or a neutral state), valence and arousal, affective attitudes (boredom, interest and confusion), and physiological states (average facial temperature, heart rate, breathing rate), as pertinent, in different rooms and zones Database of outside weather conditions (air temperature, air humidity, average wind velocity, atmospheric pressure, apparent temperature) and pollution (magnetic storm, SO2, KD2.5, KD10, NO2, CO, O3) Database of various correlations Database for smart, interactive, personalized thermal comfort and an IAQ in different rooms and zones. This database and Affective BIM4Ren providing services for managing a building’s thermal comfort and IAQ based on real-time and historical information on consumer behavior, emotions, affective attitudes, and physiological statesdthus providing all zones

226



Start-Up Creation

in each room with rational, personalized, thermal comfort (temperature, humidity), and a desirable IAQ (carbon monoxide, carbon dioxide, particulates, oxygen, and such) The database on consumer behavior constitutes the base for smart, self-learning, emotional affective computing. The Affective BIM4Ren (based on this database) selects, in real time, the most suitable lighting/illumination, film, music, and the like for its users. For example, lighting/illumination (lamps, daylight) supplies the required illumination and generates productive, positive emotions along with a beautiful atmosphere. Intensity and the colors of lighting can change depending on the moods, productivity levels, and the like of the persons within the facility.

The main Affective BIM4Ren functions appear in Fig. 9.3. Determination of the utility degree, priority, different values, and other indicators of the BIM4Ren renovation project under investigation (located in Paris, San Sebastian, or Venice) can be accomplished easily. First, obtain the numerical values and weights of the Key Performance Indicators (KPIs) (occupant expectations before renovation and their satisfaction level afterward). Next, employ the multiple criteria decisionmaking methods. The Affective BIM4Ren can then assist in performing the multiple criteria analysis of the pilot site under deliberation (located in Paris, San Sebastian, or Venice) by • • • • • • • • • •

determining the overall satisfaction (happiness) level of the occupants (HSj) comparing the overall satisfaction (happiness) level of the occupants (HSj) with the country’s happiness ranking/score (Hj)dthus the happiness of the occupants measure the success of the building’s renovation performing a multivariate design and multiple criteria evaluation of alternative building refurbishing projects for selecting the most beneficial variants (by matching occupant expectations to renovation alternatives) determining the market (VMj), integrated utilitarian and hedonic (VUHj), emotional (VEj), occupant-perceived (VPj), and investment (VIj) values of pilot site j under deliberation (a site in Paris, San Sebastian, or Venice) providing digital recommendations for improving renovation projects optimizing the selected KPI for the pilot sites under deliberation (in Paris, San Sebastian, or Venice) to be equally competitive in the market as compared to other renovation projects under comparison calculating the KPIs for the pilot site under deliberation (in Paris, San Sebastian, or Venice) for this project becoming the best among those under deliberation performing statistical analysis and groupware decision-making providing rational real-time personalized thermal comfort and IAQ in different rooms and zones selecting, in real time, the personalized lighting/illumination, film, music, etc.

The criteria system for conducting a multiple criteria analysis of the building renovation alternatives under analysis are the following (see Table 9.1): • • • • •

Facade esthetics Fire resistance Thermal insulation efficiency Water and moisture penetration Indoor air quality improvement and control

Table 9.1 Multiple criteria analysis of a building’s renovation. Pilot sites under multiple criteria analysis Paris

San Sebastian

Venice

Facade esthetics X1

þ

q1

d11

d12

d13

Fire resistance X2

þ

q2

d21

d22

d23

Thermal insulation efficiency X3

þ

q3

d31

d32

d33

Water and moisture penetration X4

þ

q4

d41

d42

d43

Indoor air quality improvement and control X5

þ

q5

d51

d52

d53

Renovation ease and duration X6

þ

q6

d61

d62

d63

Annoyances during renovation (acoustic, visual, dirt, pollution) X7



q7

d71

d72

d73

Energy efficiency and renovation impact on climate change X8

þ

q8

d81

d82

d83

Safety and security X9

þ

q9

d91

d92

d93

Environmental impact X10



q10

d10

1

d10 2

d10 3

Renovation costs X11



q11

d11

1

d11 2

d11 3

Maintenance, ease, and cost X12



q12

d12

1

d12 2

d12 3

Dampness and mold growth X13



q13

d13

1

d13 2

d13 3

Crowding and space X14



q14

d14

1

d14 2

d14 3

Lighting X15



q15

d15

1

d15 2

d15 3

Noise X16



q16

d16

1

d16 2

d16 3

Domestic hygiene, pests, and refuse X17



q17

d17

1

d17 2

d17 3

Personal hygiene, sanitation, and drainage X18



q18

d18

1

d18 2

d18 3

Water supply X19



q19

d19

1

d19 2

d19 3

Ergonomics X20



q20

d20

1

d20 2

d20 3

Project priority

P1

P2

P3

Overall occupant satisfaction (happiness) level (%)

HS1

HS2

HS3

Happiness ranking (score) by country, 2016e18

H1, 24 (6.592)

H2, 30 (6.354)

H3, 36 (6.223)

Market value of the renovation project

VM1

VM2

VM3

Integrated utilitarian and hedonic values of the renovation project

VUH1

VUH2

VUH3

Emotional value of the renovation project

VE1

VE2

VE3

Occupant-perceived value of the renovation project

VP1

VP2

VP3

Investment value of the renovation project

VI1

VI2

VI3

*The þ () indicates that a greater (less) criterion value corresponds to a higher significance for occupants.

228

• • • • • • • • • • • • • • •

Start-Up Creation

Renovation ease and duration Annoyances during renovation (acoustic, visual, dirt, pollution) Energy efficiency Renovation impact on climate change Safety and security Environmental impact Renovation costs Maintenance, ease, and cost Crowding and space Lighting Noise Domestic hygiene, pests, and refuse Personal hygiene, sanitation, and drainage Water supply Ergonomics

The overall satisfaction (happiness) level of occupants (HSj) is comparable to the country’s global happiness ranking/score (Hj). Therefore, the success rate of a building renovation is measured by the occupants of the building being happier/more satisfied than the other residents of the country.

9.6

Conclusions

The forecast is that the IoT will open up new horizons for developing more innovative and effective goods and services for humankind. Lately there are revolutions in all aspects of people’s lives because of the IoT (e.g., effective regulation of transportation traffic), including in business and for advanced, governmental, smart infrastructures. For example, intersections are managed, in real time, with the assistance of the IoT based on the intensity of traffic moving in different directions. Other examples can be the real-time regulation of the lighting on the roads or the analysis of air pollution and the like. The IoT saves people’s energy, time, and money, improves the QoL, generates innovative businesses and numbers of jobs, increases the competitiveness of the country, safeguards the environment, and slows climate change. The ability of everyday objects to respond to users’ emotional states can be used to create more personalized user experiences. Fields as diverse as medicine, advertising, robotics, virtual reality, diagnostic software, driverless cars, pervasive computing, affective toys, gaming, education, working conditions and safety, automotive industry, home appliances, etc., will significantly benefit from emotion-sensing technology. Intelligent machines with empathy for humans are sure to make the world a better place. The field is definitely progressing on human emotion understanding, thanks to achievements in computer vision, speech recognition, deep learning, and related technologies. Every year, we will see more mood sensor technology being realized. And while most existing technologies require on-body devices or voice/facial recognition software, research and development efforts will be increasingly directed toward technology, which measures emotions in a contactless way (Slesar, 2018).

Affective Internet of Things

229

Nonetheless, the humanization of the IoT is currently moving at a snail’s pace. Therefore, this section attempts to introduce the academic and business communities with the idea of humanizing the IoT. The presentation of the humanization of the IoT in this section involves the analysis of the Affective Internet of Things, Smart Homes, Ambient Intelligence, Affective Computing, BIM, Smart and Interactive Buildings, and Smart Buildings Systems. In addition, this section contains a description of the Affective BIM4Ren, which the authors of this section have developed.

Acknowledgments This research was funded as part of the “Building Information Modeling based tools & technologies toward fast and efficient RENovation of residential buildings d BIM4REN” project which has received funding from the European Union’s Horizon 2020 research and innovation program under grant agreement No. 820773.

References Ari, S., Cosden, I.A., Khalifa, H.E., Dannenhoffer, J.F., Wilcoxen, P., Isik, C., 2005. Constrained Fuzzy logic approximation for indoor comfort and energy optimization. In: NAFIPS 2005 e 2005 Annual Meeting of the North American Fuzzy Information Processing Society, pp. 500e504. https://doi.org/10.1109/NAFIPS.2005.1548586. Bier, H., 2012. Interactive building. Advances in Internet of Things 2 (04), 86. https://doi.org/ 10.4236/ait.2012.24011. Bilal, M., Oyedele, L.O., Qadir, J., Munir, K., Pasha, M., 2016. Big Data in the construction industry: a review of present status, opportunities, and future trends. Advanced Engineering Informatics 30 (3), 500e521. https://doi.org/10.1016/j.aei.2016.07.001. Borkhataria, C., 2017. The Algorithm that Could End Office Thermostat Wars: Researchers Claim New Software Can Find the Best Temperature for Everyone. https://www.dailymail. co.uk/sciencetech/article-4979148/The-algorithm-end-office-thermostat-war.html. (Accessed 8 November 2019). Brown, N., Bull, R., Faruk, F., Ekwevugbe, T., 2012. Novel instrumentation for monitoring after-hours electricity consumption of electrical equipment, and some potential savings from a switch-off campaign. Energy and Buildings 47, 74e83. https://doi.org/10.1016/ j.enbuild.2011.11.023. Burnson, F., 2015. How to Improve Employee Morale and Productivity Through Smart Climate Control. https://www.softwareadvice.com/resources/improve-employee-productivity-withclimate-control/. (Accessed 8 November 2019). Cao, B., Zhu, Y., Li, M., Ouyang, Q., 2014. Individual and district heating: a comparison of residential heating modes with an analysis of adaptive thermal comfort. Energy and Buildings 78, 17e24. https://doi.org/10.1016/j.enbuild.2014.03.063. Cheng, C.C., Lee, D., 2014. Smart sensors enable smart air conditioning control. Sensors (Basel, Switzerland) 14 (6), 11179e11203. https://doi.org/10.3390/s140611179. Ciribini, A.L.C., Pasini, D., Tagliabue, L.C., Manfren, M., De Angelis, E., 2017. Tracking users’ behaviors through real-time information in BIMs: workflow for interconnection in the

230

Start-Up Creation

Brescia smart Campus demonstrator. Procedia Engineering 180, 1484e1494. https:// doi.org/10.1016/j.proeng.2017.04.311. Cisco Systems. Inc. Annual Report 2013, 2013. http://goo.gl/8zqjl5. (Accessed 30 June 2016). CN103062871B, 2013. Air Conditioning Control System on Basis of Skin Temperatures of Human Bodies. https://patents.google.com/patent/CN103062871B/en?oq¼CN103062871Bþ. (Accessed 8 November 2019). CN105258308A, 2015. Personalized Ventilation Control System Suitable for Civil Buildings and Vehicles. https://patents.google.com/patent/CN105258308A/en?oq¼CN105258308A. (Accessed 8 November 2019). CN107120782A, 2017. Heating and Ventilating System Control Method Based on MultipleUser Thermal Comfort Data. https://patents.google.com/patent/CN107120782A/en? oq¼CN107120782A. (Accessed 8 November 2019). CN108413588A, 2018. A Kind of Personalized Air-Conditioner Control System and Method Based on Thermal Imaging and BP Neural Network. https://patents.google.com/patent/ CN108413588A/en?oq¼CN108413588A. (Accessed 8 November 2019). Costa, A.A., Lopes, P.M., Antunes, A., Cabral, I., Rodrigues, F.M., 2015. 3I buildings: intelligent, interactive and immersive buildings. Procedia Engineering 123, 7e14. https:// doi.org/10.1016/j.proeng.2015.10.051. Costa, A., Rincon, J.A., Carrascosa, C., Novais, P., Julian, V., 2018. Activities suggestion based on emotions in AAL environments. Artificial Intelligence in Medicine 86, 9e19. https:// doi.org/10.1016/j.artmed.2018.01.002. Cottafava, D., Magariello, S., Ariano, R., Arrobbio, O., Baricco, M., Barthelmes, V.M., Baruzzo, G., Bonansone, M., Console, L., Contin, L., Corgnati, S.P., Dotta, S., Fabi, V., Gambino, P., Gerlero, I., Giovannoli, A., Grillo, P., Guaschino, G., Landolfo, P., Malano, M., Mana, D., Matassa, A., Monterzino, L., Mosca, S., Nuciari, M., Olivetta, E., Padovan, D., Panto, E., Rapp, A., Sanseverino, M., Sciullo, A., Sella, S., Simeoni, R., Tartaglino, A., Vernero, F., 2019. Crowdsensing for a sustainable comfort and for energy saving. Energy and Buildings 186, 208e220. https://doi.org/10.1016/ j.enbuild.2019.01.007. Curry, E., Hasan, S., O’Riain, S., 2012. Enterprise energy management using a linked dataspace for Energy Intelligence. In: Proceeding of Sustainable Internet and ICT for Sustainability Conference, Pisa. Davies, J., Goasduff, L., 2017. How to Listen to the Voice of “Things” in the IoT. https://www. gartner.com/smarterwithgartner/how-to-listen-to-the-voice-of-things-in-the-IoT/. (Accessed 8 November 2019). Elrod, S., Hall, G., Costanza, R., Dixon, M., Rivi`eres, J.D., 1993. Responsive office environments. Communications of the ACM 36, 84e85. European Commission, 2014a. Scoping Study to Identify Potential Circular Economy Actions, Priority Sectors, Material Flows and Value Chains. Funded under DG Environment’s Framework Contract for Economic Analysis ENV.F.1/FRA/2010/0044 Publications Office of the European Union. European Commission, 2014b. Circular Economy Package Communications on Sustainable Buildings. Feldmeier, M., 2012. J. Personalized Building Comfort Control. US20120031984A1 Paradiso. U.S. Patent Application No. 13/197,375. Gao, G., Whitehouse, K., 2009. The self-programming thermostat: optimizing setback schedules Basedon home occupancy patterns. In: Proceedings of the First ACM Workshop on Embedded Sensing Systems for Energy-Efficiency in Buildings (BuildSys ’09), Berkeley, CA, USA. https://doi.org/10.1145/1810279.1810294, pp. 67e7.

Affective Internet of Things

231

Gr€unkranz, D., 2007. Towards a Phenomenology of Responsive Architecture: Intelligent Technologies and Their Influence on the Experience of Space. University of Applied Arts Vienna, Architecture. University Publishing, Vienna. Habibi, S., 2016. Smart innovation systems for indoor environmental quality (IEQ). Journal of Building Engineering 8, 1e13. https://doi.org/10.1016/j.jobe.2016.08.006. Habibi, S., 2017a. The promise of BIM for improving building performance. Energy and Buildings 153, 525e548. https://doi.org/10.1016/j.enbuild.2017.08.009. Habibi, S., 2017b. Micro-climatization and real-time digitalization effects on energy efficiency based on user behaviour. Building and Environment 114, 410e428. https://doi.org/ 10.1016/j.buildenv.2016.12.039. Heidari, M., Allameh, E., de Vries, B., Timmermans, H., Mozaffar, F., 2014. Smart-BIM virtual prototype implementation. Automation in Construction 39, 134e144. https://doi.org/ 10.1016/j.autcon.2013.07.004. Hoseini, A.G., Zhang, T., Nwadigo, O., Hoseini, A.G., Raahemifar, K., 2017. Application of nD BIM integrated knowledge-based building management system (BIM-IKBMS) for inspecting post-construction energy efficiency. Renewable and Sustainable Energy Reviews 72, 935e949. https://doi.org/10.1016/j.rser.2016.12.061. Howell, S., Rezgui, Y., Beach, T., 2017. Integrating building and urban semantics to empower smart water solutions. Automation in Construction 81, 434e448. https://doi.org/10.1016/ j.autcon.2017.02.004. Huang, T.L., 2010. Environment Controlling System and Method Thereof. US20070057077A1 U.S. Patent No. 7,764,180. U.S. Patent and Trademark Office, Washington, DC. Jung, W., Jazizadeh, F., 2019. Comparative assessment of HVAC control strategies using personal thermal comfort and sensitivity models. Building and Environment 158, 104e119. https://doi.org/10.1016/j.buildenv.2019.04.043. Karimi, F.J., Becerik-Gerber, B., Orosz, M.D., Kichkaylo, T., Ghahramani, A., 2014. Humanbuilding Interaction Framework for Personalized Comfort Driven System Operations in Buildings. US20140277765A1. U.S. Patent Application No. 14/213,475. Keinan, E., 2015. Five Ways To Build A Cognitive Business. http://goo.gl/YHrNLq. (Accessed 30 June 2016). Khan, A., Hornbæk, K., 2011. Big data from the built environment. In: Proceeding of 13th International Conference on Ubiquitous Computing, Beijing. Kim, J., Hwangbo, H., 2018. Sensor-based optimization model for air quality improvement in home IoT. Sensors (Basel). 18 (4), E959. https://doi.org/10.3390/s18040959. Kim, J., Zhou, Y., Schiavon, S., Raftery, P., Brager, G., 2018. Personal comfort models: predicting individuals’ thermal preference using occupant heating and cooling behavior and machine learning. Building and Environment 129, 96e106. https://doi.org/10.1016/ j.buildenv.2017.12.011. Laftchiev, E., 2019. A. Methods and Systems for Personalized Heating, Ventilation, and Air Conditioning. US20190242608A1. Natarajan. U.S. Patent Application No. 15/888,172. Lee, D.S., Sunggeun, S.O.N.G., Gunhyuk, P.A.R.K., Sungmok, S.E.O., Kwanwoo, S.O.N.G., Hyejung, C.H.O., 2016. Method and Device for Controlling Room Temperature and Humidity. WO2016036062A1. U.S. Patent Application No. 14/829,065. Lee, B., Kwon, O., Lee, I., Kim, J., 2017. Companionship with smart home devices: the impact of social connectedness and interaction types on perceived social support and companionship in smart homes. Computers in Human Behavior 75, 922e934. https://doi.org/ 10.1016/j.chb.2017.06.031.

232

Start-Up Creation

Levy, H.F., Betz, P.G., 2001. Personalized Air Conditioned System. US6318113B1 U.S. Patent No. 6,318,113. U.S. Patent and Trademark Office, Washington, DC. Levy, H., Betz, P., 2006. Personalized Air Conditioning/Displacement Ventilation System. US20060211362A1. U.S. Patent Application No. 11/415,638. Li, J., Niu, J., Mak, C.M., Huang, T., Xie, Y., 2018. Assessment of outdoor thermal comfort in Hong Kong based on the individual desirability and acceptability of sun and wind conditions. Building and Environment 145, 50e61. https://doi.org/10.1016/ j.buildenv.2018.08.059. Li, Z., Loveday, D., Demian, P., 2019. Feedback messaging, thermal comfort and usage of office-based personal comfort systems. Energy and Buildings 205, 109514. https://doi.org/ 10.1016/j.enbuild.2019.109514. Liu, W., Lian, Z., Zhao, B., 2007. A neural network evaluation model for individual thermal comfort. Energy and Buildings 39 (10), 1115e1122. https://doi.org/10.1016/ j.enbuild.2006.12.005. Lu, S., Wang, W., Lin, C., Hameen, E.C., 2019. E. C. Data-driven simulation of a thermal comfort-based temperature set-point control with ASHRAE RP884. Building and Environment 156, 137e146. https://doi.org/10.1016/j.buildenv.2019.03.010. Mano, L.Y., Faiçal, B.S., Nakamura, L.H., Gomes, P.H., Libralon, G.L., Meneguete, R.I., Filho, G.P.R., Giancristofaro, G.T., Pessin, G., Krishnamachari, B., Ueyama, J., 2016. Exploiting IoT technologies for enhancing Health Smart Homes through patient identification and emotion recognition. Computer Communications 89, 178e190. https://doi.org/ 10.1016/j.comcom.2016.03.010. Menassa, C., Li, D., Kamat, V., 2019. Offices are Too Hot or Too Cold e is There a Better Way to Control Room Temperature? https://theconversation.com/offices-are-too-hot-or-toocold-is-there-a-better-way-to-control-room-temperature-108982. (Accessed 8 November 2019). Miller, C., Schlueter, A., 2013. Applicability of lean production principles to performance analysis across the life cycle phases of buildings. In: CLIMA 2013: 11thREHVA Congress and 8th International Conference on IAQVEC, Prague, Czech Republic. Montoyo, A., MartíNez-Barco, P., Balahur, A., 2012. Subjectivity and sentiment analysis: an overview of the current state of the area and envisaged developments. Decision Support Systems 53 (4), 675e679. https://doi.org/10.1016/j.dss.2012.05.022. Morley, I., 2019. Learn How Smart HVAC Technology is Designed to Modernize Your Workplace. https://serraview.com/smart-hvac-sensor-technology-smart-buildings/. (Accessed 8 November 2019). Nikovski, D.N., 2016. Method and System for Personalization of Heating, Ventilation, and Air Conditioning Services. US20160320081A1. U.S. Patent Application No. 14/697,943. Noury, N., 2014. 5.08: Smart Homes: Ambient intelligence and how IT can help increase longevity. Comprehensive Biomedical Physics 5, 139e152. Pan, M.-S., Yeh, L.-W., Chen, Y.-A., Lin, Y.-H., Tseng, Y.-C., 2011. A WSN-based intelligent light control system considering user activities and profiles. IEEE Sensors Journal 8, 1710e1721. https://doi.org/10.1109/JSEN.2008.2004294. Pieroni, M., Rizzello, L., Rosini, N., Fantoni, G., De Rossi, D., Mazzei, D., 2015. Affective Internet of Things: Mimicking human-like personality in designing smart-objects. In: 2015 IEEE 2nd World Forum on Internet of Things (WF-IoT), pp. 400e405. https://doi.org/ 10.1109/WF-IoT.2015.7389088. Reynolds, J., Rezgui, Y., Hippolyte, J.-L., 2017. Upscaling energy control from building to districts: current limitations and future perspectives. Sustainable Cities and Society 35, 816e829. https://doi.org/10.1016/j.scs.2017.05.012.

Affective Internet of Things

233

Riaz, Z., Arslan, M., Kiani, A.K., CoSMoS, S.A., 2014. A BIM and wireless sensor based integrated solution for worker safety in confined spaces. Automation in Construction 45, 96e106. https://doi.org/10.1016/j.autcon.2014.05.010. Shishehgar, M., Kerr, D., Blake, J., 2018. A systematic review of research into how robotic technology can help older people. Smart Health 7, 1e18. https://doi.org/10.1016/ j.smhl.2018.03.002. Slesar, M., 2018. Emotion-Sensing Technology in the Internet of Things. https://onix-systems. com/blog/emotion-sensing-technology-in-the-internet-of-things. (Accessed 8 November 2019). Terroso-Saenz, F., Gonzalez-Vidal, A., Ramallo-Gonzalez, A.P., Skarmeta, A.F., 2019. An open IoT platform for the management and analysis of energy data. Future Generation Computer Systems 92, 1066e1079. https://doi.org/10.1016/j.future.2017.08.046. Volkov, A.A., Batov, E.I., 2015. Dynamic extension of building information model for “smart” buildings. Procedia Engineering 111, 849e852. https://doi.org/10.1016/ j.proeng.2015.07.157. Wang, Z., Warren, K., Luo, M., He, X., Zhang, H., Arens, E., Chen, W., He, Y., Hu, Y., Jin, L., Liu, S., Cohen-Tanugi, D., Smith, M.J., 2020. Evaluating the comfort of thermally dynamic wearable devices. Building and Environment 167, 106443. https://doi.org/10.1016/ j.buildenv.2019.106443. Wilson, G., Pereyda, C., Raghunath, N., de la Cruz, G., Goel, S., Nesaei, S., Minor, B., Schmitter-Edgecombe, M., Taylor, M.E., Cook, D.J., 2019. Robot-enabled support of daily activities in smart home environments. Cognitive Systems Research 54, 258e272. https:// doi.org/10.1016/j.cogsys.2018.10.032. Wong, J.K.W., Leung, J., Skitmore, M., Buys, L., 2017. Technical requirements of age-friendly smart home technologies in high-rise residential buildings: a system intelligence analytical approach. Automation in Construction 73, 12e19. https://doi.org/10.1016/ j.autcon.2016.10.007. Yalcin, N., Balta, D., Ozmen, A., 2018. A modeling and simulation study about CO2 amount with web-based indoor air quality monitoring. Turkish Journal of Electrical Engineering and Computer Sciences 26 (3), 1390e1402. https://doi.org/10.3906/elk-1612-57. Yang, T., Clements-Croome, D., Marson, M., 2017. Building energy management systems. Encyclopedia of Sustainable Technologies 291e309. Yun, J., Won, K.H., 2012. Building environment analysis based on temperature and humidity for smart energy systems. Sensors 12 (10), 13458e13470. https://doi.org/10.3390/ s121013458. Zhai, Y., Miao, F., Yang, L., Zhao, S., Zhang, H., Arens, E., 2019. Using personally controlled air movement to improve comfort after simulated summer commute. Building and Environment 165, 106329. https://doi.org/10.1016/j.buildenv.2019.106329. Zhang, H., Arens, E., Huizenga, C., Han, T., 2010. Thermal sensation and comfort models for non-uniform and transient environments, part II: local comfort of individual body parts. Building and Environment 45 (2), 389e398. https://doi.org/10.1016/ j.buildenv.2009.06.015. Zimmermann, A., Goasduff, L., 2018. How Artificial Intelligence is Being Used to Capture, Interpret and Respond to Human Emotions and Moods. https://www.gartner.com/ smarterwithgartner/emotion-ai-will-personalize-interactions/. (Accessed 8 November 2019).

IoT and cloud computing for building energy efficiency

10

A. Martín-Garín 1 , J.A. Mill an-García 1 , A. Baïri 2 , M. Gabilondo 3 , A. Rodríguez 4 1 ENEDI Research Group, Department of Thermal Engineering, Faculty of Engineering of Gipuzkoa, University of the Basque Country UPV/EHU, Donostia-San Sebastian, Spain; 2 University of Paris, Ville d’Avray, France; 3Machine-tool Institute (IMH), Elgoibar, Spain; 4 Departamento de Construcciones Arquitectonicas e I.C.T., University of Burgos, Burgos, Spain

10.1

Introduction

Nowadays, energy consumption in buildings is one of the key topics in environmental and smart cities fields. Thus, energy monitoring in buildings becomes a key tool enabling an easier method for energy management in buildings, understanding its energy performance and lastly for improving them. Also the acquisition, collection, and processing of data in real time is a prevailing need in the building sector to be ready for the decision-making process. In this sense, the Internet of things (IoT) becomes an essential tool to achieve this purpose. However, multiple challenges such as system scalability, high acquisition costs (Ja~nez Moran et al., 2016), or lack of interoperability (Noura et al., 2019) appear and make difficult the real implementation of these technologies. Technologies have an increasing importance in our daily lives and routinary activities in which increasingly real-time information is gradually being introduced. The IoT is responsible for the creation of this technological paradigm since it allows the connection between the different devices that make up the smart environments. Currently, multiple applications can be found in fields such as agriculture, automotion and mobility, buildings and cities, energy, healthcare, or safety management (Ojha et al., 2015; Mesas-Carrascosa et al., 2015; Rathore et al., 2016; Rizwan et al., 2017; Zhang et al., 2019). Furthermore, currently, there are multiple IoT communication technologies for data transmission. The choice of one of them will depend on aspects such as the range, data rate, energy consumption, or the type of application. The required features for environmental monitoring devices (Martín-Garín et al., 2018; Lucchi et al., 2019) differ markedly from those that are vision-based tracking (Zou and Kim, 2007; Seo et al., 2015), so the correct analysis of the proposed IoT network represents a relevant defiance. This sector is expected to acquire great relevance in the upcoming years. A relevant increase in the number of Internet-connected devices is expected; the current 6.4 billion will increase up to 20.8 or 50 billion in 2020 (Dave, 2011; Says, 2015). Due to this, cities, buildings, and things are increasingly becoming receptors and generators

Start-Up Creation. https://doi.org/10.1016/B978-0-12-819946-6.00010-2 Copyright © 2020 Elsevier Ltd. All rights reserved.

236

Start-Up Creation

of a huge amount of data, which often is hard to control and to analyze to extract profitable data. Consequently, there is a big risk for the creation of irrelevant data, also known as fat data. The International Data Corporation (IDC) predicts that the total amount of generated data will increase from 33 zettabytes (ZB) in 2018 to 175 ZB by 2025 (Reinsel et al., 2018). The IDC also indicated that only 28% of the information in 2012 was valuable if it were tagged and analyzed; nevertheless, in practice, the estimation was that less than the 0.5% was analyzed (Gantz et al., 2013). This is why techniques based on machine learning and deep learning have acquired great relevance in recent years (Rashid and Louis, 2019). Within energy consumption context in buildings, this sector represents 40% of the total final energy consumption (European Parliament, 2010), so the improvement of their energy performance supposes a relevant topic. In addition, the building sector is undergoing several changes that come as a result of the energy-saving policies that are being implemented with the aim of promoting the low energy consumption buildings (net zero-energy buildings). One of the changes is the need to conduct monitoring campaigns as a method of verification of buildings behavior. According to the International Energy Agency report (Digitalization, 2017), buildings digitalization could cut energy use by about 10% by using real-time data to improve operational efficiency. These data agree with the results between 5% and 15% published by Darby (2006). Energy performance in buildings depends on multiple factors such as buildings exposure, insulation level, facilities performance, or the climate. Within energy consumption sources, space heating has the greater effect on the energy bill as it represents the 70% of total energy use (Economidou et al., 2011). Nevertheless, airtightness becomes one of the most relevant parameters since its effect can suppose up to 40% (Brinks et al., 2015) to 50% (Fernandez-Ag€ uera et al., 2011) of the heating energy demand. In addition, its impact is not reduced solely to the energy issue; it also has an effect on indoor air quality (IAQ) due to the impact in discomfort caused by drought, transport of odors, dust, or moisture problems (K€ unzel et al., 2012). This is the reason why in recent years, the control of unwanted air leaks has become one of the most relevant points to reach high-efficiency buildings. This chapter focuses on the research carried out in the field of building monitoring with IoT technology. The objective is to develop a monitoring framework in buildings within buildings digitalization context to enable the creation of start-ups where aspects such as ability for fast prototyping, low costs, and mass deployment capacity are key points. Previous works (Martín-Garín et al., 2018) have focused on the ESP8266 Wi-Fi microchip that offered those features. The use of open-source platforms proved to be an excellent tool for the development of specific prototypes according to the particular requirements of the project. It also proved to be a low-energy device that allowed the development of cost-effective monitoring systems. Nevertheless also was shown the existing challenge of developing devices capable of sending data over long distances and in cases where there is no Wi-Fi access. Once presented the introduction, existing challenges, and the main aim of the research, the following section introduces the background of IoT and energy efficiency applied to buildings to provide the context for the presented work. Then, the materials and methods section lay outs the proposed methodology and technical details of the

IoT and cloud computing for building energy efficiency

237

present research using also a case study as a validation method. The fifth section states the obtained results from the case study and those of the monitoring device are analyzed. Last but not least follows the final section where the main conclusions and future research are presented.

10.2

Literature review

This section provides a literature review from the main technological trends in construction sector and later deepens into the specific topic of the research. The digitalization of construction is taking the sector to a new path to improve construction processes, building maintenance, and ultimately the quality perceived by end users. Thus, the IoT, as a digitization tool, is becoming the backbone to improve energy efficiency in buildings through their monitoring. The following sections will deal with the submitted topics.

10.2.1 Digitization of the construction industry The society and the current environment more and more globalized are in continuous evolution and demand the continuous improvement of processes and methodologies and, in fact, the evolution of the different sectors that make up the economy to maintain the competitiveness of each of them. In this aspect, sectors such as the industrial sector are facing a great revolution, carrying out a digital transformation of it to assimilate new technologies and maintain or improve their competitiveness. Thus, currently, the digitization is considered as the cornerstone for the new work routes that companies must follow. However, construction sector is still considered one of the least advanced compared with other sectors (Manyika et al., 2015). Experts predict a sector that will increasingly be built on connected systems of sensors, intelligent machines, mobile devices, and new software applications, all managed by an active and prepared workforce, which knows how to take full advantage of the possibilities of this new environment (Kaufmann et al., 2018). This digital transformation must happen throughout the value chain and must be done globally and not in isolation to be truly effective. Digital technologies not only improve productivity and reduce project delays but can also improve the quality of buildings and their safety, working conditions, and environmental protection (Schober et al., 2016). It should be noted that among the tools that are currently being used and serve as a way to digitize the sector are the following: the implementation of the building information modeling (BIM) methodology for the generation of intelligent virtual models of buildings (Volk et al., 2014), the use of drones (unmanned aerial vehicles) (Freimuth and K€onig, 2018), 3D laser scanner for the comprehensive collection of geometries, additive manufacturing (Labonnote et al., 2016), and digital models (virtual reality and augmented reality) for the representation of construction models or the combination of the IoT sensing (Ghayvat et al., 2015) for data collection and real-time control.

238

Start-Up Creation

The recent European Directive (European Parliament, 2018) and European documents (Advisory Group and Consortium, 2009; European Commission, 2009, 2010) on energy efficiency also advocate the implementation of digital procedures in the construction sector. Its purpose is to reduce energy consumption from information and communication technologies and establish a classification of the degree of preparation of buildings for intelligent applications. This unequivocally demonstrates that digitalization is not an objective in itself but a means to achieve the priorities of the European Union.

10.2.2

Internet of things and cloud computing

IoT, often defined as the new paradigm of the 21st century, has become one of the keys for the digitization of the construction industry (Grosso Sategna et al., 2019). Some of the IoT highlights are its impact on various aspects of everyday life and the behavior of potential users (Atzori et al., 2010). Since 2008e09, considered the moment when more “things or objects” were connected to the Internet than people (Dave, 2011), the IoT has evolved substantially. It is currently considered one of the emerging technologies that is at the peak of expectations of the Hype Cycle and will reach the plateau of productivity between 5 and 10 years as Gartner states (Walker, 2018). To deal with the description of the IoT technology, the definition of its architecture represents a first step. Nevertheless, there is not a unique consensus about it (Sethi and Sarangi, 2017) since these architectures can be described by the models of three or five layers (Wu et al., 2010; Khan et al., 2012; Choudhary and Jain, 2017). The three-layer model is defined by the following: • • •

Physical or perception layer: This is the lowest layer of the conventional architecture model, and it is the visible part by users. This layer is composed by sensors, actuators, and the necessary hardware responsible of the connection with the physical world. Network layer or transmission layer: This is the core of the IoT. Its objective is to connect the perception layer and the application. Its features are also used for transmitting and processing the collected data by the sensors. Application layer: This is the upper layer and is responsible of the connection with the end user through an application that depicts the collected data.

On the other hand, the five-layer model additionally includes the transport, processing, and business layers. In this model, the features of the physical and application layers are the same as the previous three-layer architecture. The key features of the new layers are as follows: •



The transport layer: Its function is to transmit the data from the physical layer to the processing layer through the IoT technologies such as 3G, Bluetooth, and Wi-Fi. Due to the required interoperability between the huge amount of devices and different communication technologies, this layer is of great relevance. The processing layer: Also known as a middleware layer, its purpose is to handle the collected data. At this point, huge amounts of data are stored and processed according to the required application. It extracts the useful data to provide a better performance of the IoT framework and allows autonomous decision-making process.

IoT and cloud computing for building energy efficiency



239

The business layer: This layer allows the IoT system administrator to control the performance of the entire system. In this layer, also the users’ privacy and the management of the required data acquisition and storage can be done.

In the past few years, within the scope of the IoT, the technological trend of sent sending, processing, and storing the data in cloud services has become increasingly popular. Even though the idea of the cloud was already introduced in the 1960s by John McCarthy and J.C.R. Licklider, it was not until 2006 when Google’s CEO Eric Schmidt coined the term and began to gain popularity. One of the most adopted definitions for cloud computing may be that provided by the National Institute of Standards and Technology (Zhou et al., 2013): “Cloud computing is a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.” The sharing of resources achieved with this technology presents clear advantages as can be no up-front investment, lowering operating cost, highly scalable, easy access, reducing business risks and maintenance expenses, higher processing performance, virtually unlimited storage, and resources optimization or its ubiquity. Thus, cloud computing becomes a way for companies for outsourcing this service and a great technology for the integration together with the IoT. The features offered by both technologies complement each other in an excellent manner providing a clear synergy (Zhou et al., 2013; Botta et al., 2016). In short, the complex physical/real world captured by the IoT could be effectively managed through the cloud. This integration results in the opportunity for building new scenarios that allow the creation of applications in a variety of environments. Several companies provide, among the services, cloud-based solutions, and they could be classified into three main types (Armbrust et al., 2010): • • •

Infrastructure as a service is the lowest layer in an infrastructure, which offers the provision processing, storage, networks, and other resources where the user is able to deploy and run arbitrary software. Platform as a service is the middle layer that provides a platform for the development and hosting of a company’s applications. This layer combines the infrastructure and the programming environment, being the development of applications the main aim. Software as a service is the top layer, and it is a distribution model where both software and data are hosted in the cloud and are accessible from a web browser. This implies that the provider is responsible for the maintenance and support of the software and allows users to reduce licensing costs.

The use of both technologies, IoT and cloud computing, offers clear advantages in both the professional and academic areas. In addition, the combined use of these allows to overcome the drawbacks of each of them. So, the use of both technologies becomes essential to support the digitalization and optimization of the construction industry.

240

10.2.3

Start-Up Creation

Building energy efficiency

The energy performance regulations for buildings were radically strengthened in the past decade in Europe (European Parliament, 2010, 2012), and the increase of insulation requirements has reduced greatly the heat losses through the thermal envelope. For this reason, the repercussion of heat losses through air change rate has become proportionally higher in building’s energy demand. It is worth remembering that traditionally, building’s heat losses through air renovation incorporate two different phenomena: ventilation and infiltration. That is, while the ventilation is a necessary feature of buildings to guarantee the IAQ, the air leakages are an unintended and uncontrolled effect. Therefore, despite the extra fresh air, it does not assure a proper IAQ, and it can increase considerably the heating and cooling needs of buildings. Furthermore, there are additional problems associated with poor building airtightness, such as moisture, acoustic, fire safety, and energy. The leaked air through the envelope implies the introduction of untreated air into the building. In high insulated buildings, infiltrations can suppose about 25% of the heating load and 4% of the cooling load (Emmerich and Persily, 1998). Other researchers report that air leakages can account up to 40% (Brinks et al., 2015) and 50% (Fernandez-Ag€ uera et al., 2011) of the total heat energy demand. In the case of existing buildings, the wide variety of energy retrofitting measures has increasingly included airtightness improvements, especially in the cases where other actions are not feasible, like in historic buildings. Many professionals are implementing the airtightness analysis in their energy assessments due to its great impact on this building type (Troi and Bastian, 2014; Eskola et al., 2015). The classic expression that quantifies this energy loss according to the first law of thermodynamics in stationary state is defined as follows: _ p $ðTi  To Þ Q_ inf ¼ m$c

(10.1)

_ represents air where Q_ inf is the sensible cooling or heat load due to air leaks (W), m leaks mass flow rate (kg/s), Ti represents indoor room temperature (K), To represents outside temperature (K), and cp represents specific heat capacity of air (J/kg K). The main driving force that generates the air movement is the pressure, moving from higher pressure to lower pressure zones. The specific paths that the air leakages take through all the building envelopes are usually difficult to define. Due to this, the characterization of air leaks through the envelope is usually done for the whole building. For this characterization, one of the most extended techniques is the blower door test (Kronvall, 1978; Gadsby et al., 1981) due to the relatively quick and inexpensive procedure. In this test, a fan is installed in a door or window, thus inducing a pressure difference between indoor and outdoor. The blower generates multiple pressure steps generally between 10 and 75 Pa measuring at the same time the generated airflow. This relation between the pressure drop and the measured flow is called the leakage curve of the building.

IoT and cloud computing for building energy efficiency

241

In the fan pressurization method, the airflow is calculated by the power law Eq. (10.2), in which VDp is the airflow (m3/h), CL is the air filter coefficient (m3/h Pan), Dp is the pressure difference (Pa), and n is the exponent of airflow (). It takes values close to 0.5 when the flow is turbulent and up to 1.0 when the flow is laminar, being the typical value around 0.65. V_ Dp ¼ CL $ðDpÞn

(10.2)

From the airflow measurement, and knowing the different geometrical characteristics of the analyzed enclosure (volume, envelope area, and floor area), it can describe the airtightness of the analyzed building through normalized indicators according to the international airtightness standards (ISO, 2015). These indicators are usually referred to a pressure difference of 50 Pa. This considerable pressure difference is enough to prevent from any fluctuating weather conditions, which may influence the result. Nevertheless, this value differs from the air flow present in natural pressure difference conditions, which are generally considered between 4 and 10 Pa (ASHRAE, 2017). This pressure difference over the buildings depends on multiple aspects as can be the climatic conditions, building geometry, exposure level, or location. There are also alternative representations to the air flow equation based on the orifice flow Eq. (10.3), assuming an opening area and a discharge coefficient. One of the most extended expressions, based on the previous equation, is based on the effective leakage area (ELA), pressure reference of 4 Pa, and considering discharge coefficient equal to the unity (Sherman and Grimsrud, 1980): sffiffiffiffiffiffiffiffiffiffiffi 2 V_ ¼ Cd $A$ $Dp r

(10.3)

where V_ (m3/s) is the air flow rate, Cd (dimensionless) is the discharge coefficient, r (kg/m3) is the air density, Dp (Pa) is the pressure difference across opening, and A (m2) is the area of the opening. As shown, the control of air leaks and the characterization of airtightness in buildings are essential to achieve high-energy efficiency buildings. Therefore, this issue becomes a challenge to solve for researchers and construction professionals.

10.3

Overview of Internet of things technologies

Due to the great expectation on the IoT, currently there are several standards that enable this technology. The objective of this section is to review the most relevant features of these technologies so that it serves as a support base to select the technology that best suits to the requirements of each project. The IoT covers a large number of types of uses, technologies, and scales of application. Due to this, there are currently

Start-Up Creation

High

242

Cellular

Medium

Bandwidth

WLAN

LPWAN Licensed

Low

WPAN LPWAN

Proximity

Unlicensed

Short

Medium

Long

Range Figure 10.1 Internet of things enabling technologies.

several IoT solutions for interconnection between cloud services and the devices. They can be distinguished according to their communication range and bandwidth (Fig. 10.1). A list that provides a compilation of the main IoT technologies is presented in Table 10.1, which reports a slight summary of their features: •





Near-field communication (NFC): It is a short-range wireless communication technology (10 cm). NFC belongs to the subgroup of high-frequency RFID operating at the 13.56 MHz frequency and allowing the exchange of data between nearby devices through the use of electromagnetic fields to encode and read information. Among the NFC applications, its use in smartphones stands out, allowing consumers to make contactless mobile payments, access control cards and identification cards, access digital content, and connect electronic devices. Bluetooth: It is also a short-range wireless technology with medium transfer rates (1 Mbps) and operating in the 2.4 GHz band (ISM band). Compared with classic Bluetooth, Bluetooth Low Energy (BLE) is designed to reduce the energy consumption of devices due to the possibility of using sleep mode when communication is not necessary. It also allows a faster pairing between devices. Like the classic Bluetooth, BLE operates in the 2.4 GHz band. Wi-Fi (802.11): Normally, Wi-Fi connectivity is the obvious choice chosen by developers due to the omnipresence of Wi-Fi in domestic and commercial environments. The Wi-Fi Alliance defines Wi-Fi as any “wireless local area network (WLAN) products that are based on the Institute of Electrical and Electronics Engineers (IEEE) 802.11 standards.” Currently, the most common Wi-Fi standard used in homes and in many companies is 802.11n, offering significant performance in a range of hundreds of megabits per second, very suitable for file transfer, but consuming too much power to develop IoT applications. So IoT devices might only use 802.11b or g for power conservation reasons. Although Wi-Fi is adopted within

Range

Data rate

Power

Sigfox

30e50 km (rural) 3e10 km (urban)

100e600 bps

VL

LoRaWAN

15 km (suburban) 2e5 km (urban)

0.3e50 kbps

NB-IoT

5e15 km

LTE-M

Frequency band

Channel bandwith

Network type

EU: 868 MHz US: 915 MHz

200 kHz

LPWAN (unlicensed)

VL

EU: 868 MHz US: 915 MHz

125 kHz, 500 kHz

LPWAN (unlicensed)

250 kbps

L

700e900 MHz

180 kHz

LPWAN (licensed)

11 km

200 kbpse1 Mbps

L

700e900 MHz

1.4 MHz

LPWAN (licensed)

Wi-Fi 802.11a/b/g/ h/j/n/ac

35e70 m (indoor) 140e250 m (outdoor)

b: 11 Mbps a/g/h/j: 54 Mbps n: 600Mbps ac: 86.7 Mbps e6.9 Gbps

H

2.4e5 GHz

20 MHz, 40 MHz, 80 MHz, 160 MHz

WLAN

1G/2G/3G/4G/5G

15e200 km

1G: 2.4 kbps 2G: 64 kbps 3G: 144 kbpse2 Mbps 4G: 100 Mbpse1 Gbps 5G: 35.46 Gbps

H

e

e

WAN

243

Continued

IoT and cloud computing for building energy efficiency

Table 10.1 Summary of Internet of things network technologies.

244

Table 10.1 cont’d Range

Data rate

Power

ZigBee

10e100 m

250 kbps

L

Z-Wave

15e150 m

9.6e40 kbps

Thread

30 m

Bluetooth

Frequency band

Channel bandwith

Network type

EU: 868 MHz US: 915 MHz Worldwide: 2.4 GHz

600 kHz, 1.2 MHz, 2 MHz

WPAN

L

900 MHz

200 kHz

WPAN

250 kbps

L

915 MHz/ 2.4 GHz

5 MHz

WPAN

1e100 m

1e3 Mbps

M

2.4 GHz

1 MHz

WPAN

BLE

50e150m

125 kbpse2 Mbps

VL

2.4 GHz

2 MHz

WPAN

NFC

10 cm

100e420 kbps

VL

13.56 MHz

1 MHz

Proximity

() It depends on the cellular generation and the country.

Start-Up Creation

IoT and cloud computing for building energy efficiency









245

many prototype and current generation IoT devices, as longer-range and lower-power solutions become more widely available, it is likely that Wi-Fi will be superseded by these lower-power alternatives. ZigBee: It is a low-power wireless technology focused on home automation and industrial applications. They are based on the IEEE 802.15.4 protocol, a wireless network technology that operates at 868 MHz (EU), 915 MHz (US), and the most usual 2.4 GHz (around the world) in applications that require low-rate communications, sending data within delimited areas with a range of 100 m, such as homes or buildings. This technology is low energy consumption allowing the construction of node networks. The messages are sent between nodes without the need for any individual node to be within the transmission range of all members of the network, being able to form networks with star or mesh topology. ZigBee is cheaper than Wi-Fi; nevertheless, it will need gateway for the connection to the Internet. The most popular applications are the Philips Hue smart light bulbs, the Amazon Echo Plus smart speaker, and the recently presented Sonoff Basic ZigBee. Z-Wave: It has an architecture similar to ZigBee; it works like a mesh allowing to increase the network range with each added device (scalable up to 232 nodes). One of the characteristics that differs from ZigBee is that it is a more restricted protocol whose owner is Silicon Labs. It uses a frequency band