Biodegradable foam packaging maker Cruz Foam shuts down, patents sold to TemperPack

Cruz Foam, a developer of compostable foam intended to replace petroleum-based plastic packaging foam, has ceased operations despite having raised USD 18m in a Series A round. It failed to meet customer expectations on performance, reliability and cost. TemperPack has bought its 23 patents and patent applications, but not its operating business or customer relationships.

Why this mattersA well-funded compostable-foam challenger failing on cost and performance underlines how hard it remains to displace incumbent plastic foam packaging at scale.

• Cruz Foam developed a compostable foam material as an alternative to petroleum-based plastic packaging foam
• The company had raised USD 18m in a Series A round, with investors including Leonardo DiCaprio and Ashton Kutcher
• The failure is attributed to an inability to meet customer expectations on performance, reliability and cost
• TemperPack acquired Cruz Foam's 23 patents and patent applications
• The acquisition excludes Cruz Foam's operating business and customer relationships
• Former Cruz Foam executive Toby Corey said capital can buy time but not product-market fit

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