Nucleus Fund backs hemp materials startup Terraphene, maker of a $900M pallet deal
What's the deal? TerrapheneDealroom has a profile for this one. Try Dealroom →, a Lehi, Utah materials startup making hemp-based alternatives to plastic, wood, metal, and concrete, has raised early-stage venture funding led by Nucleus FundDealroom has a profile for this one. Try Dealroom →. The firm is the venture arm of the Nucleus InstituteDealroom has a profile for this one. Try Dealroom →. The round was announced in September 2026.
What's the company? Terraphene grew out of an accident. Co-founders Daniel and Jarrett Webster stumbled onto a hard, epoxy-like hemp material during CBD extraction — one so tough that a flooring contractor with heavy grinders gave up trying to remove it from a warehouse floor.
How does it make money? Terraphene does not plan to manufacture finished goods. "We want to be kind of the IntelDealroom has a profile for this one. Try Dealroom → inside," Daniel Webster said, supplying a proprietary core material to manufacturers rather than competing with them.
Why pallets? The company's first product is pallets, chosen because they face a low regulatory bar yet touch nearly every US supply chain. Terraphene has signed a supply agreement with pallet makers Cole PaletteDealroom has a profile for this one. Try Dealroom → and Commercial Lumber & Pallet CompanyDealroom has a profile for this one. Try Dealroom →, which formed a joint venture called DurapalDealroom has a profile for this one. Try Dealroom → to bring the material to market.
What's the scale? The two manufacturers together produce roughly 50,000 pallets a day. Webster said the plan is to convert that volume away from wood over the next five years, part of a nine-figure supply arrangement.
What's the endgame? Beyond pallets, Terraphene pitches hemp as a way to help refill the Great Salt Lake by replacing water-thirsty alfalfa acreage. Its longer-term ambitions stretch to building materials and beyond.
The signal: The deal points to growing commercial interest in industrial hemp materials as a substitute for wood and plastic. By targeting pallets first — a high-volume, low-regulation product — Terraphene bets it can prove its material at scale before moving into tougher markets.
Read more: techbuzznews.com
Image credit: blumenbiene
