uncategorized · 8/15/2014

Renewable Products initially experienced growth pains typical of any start-up

Renewable Products' Kaisa Hietala discussed about the challenges Neste Oil's new business faced during the first years.


Renewable Products’ Kaisa Hietala covered some of the experiences encountered during the early days of the business in her Flow Talks presentation. The team faced a number of typical start-up challenges during its initial phase, she says.

Neste Oil experienced many of the same challenges faced by start-ups when it decided to become one of the first companies to develop a real presence in renewable fuels, according to Executive Vice President, Renewable Products, Kaisa Hietala.

Speaking last Friday at the Flow Talks event held before the start of this year’s Flow Festival in Helsinki, she said that the development work launched nearly 10 years ago shared a lot in common with the issues encountered by any new business trying to carve out a place for itself in the world.

One of the biggest problems faced by the small group of 5-6 people in the initial development team was that the rest of Neste Oil was not very favorably disposed towards starting up a new business at the time.

“We just wanted some space to breathe, and a thing I often heard was that what we were trying to do didn’t make much sense and that we couldn’t produce fuel from waste,” remembers Kaisa.

Although the team believed wholeheartedly in what it was trying to do, the need to really market the idea proved a surprise, as did the opposition it seemed to generate.

“We were perhaps so much concentrated on our own issues that we didn’t initially understand that we also needed to pay more attention what was going on around us.”

Although the initial reactions around the world to what Neste Oil was able to achieve were positive, some real resistance emerged when the company wanted to begin exporting its renewable fuel.

The biggest opponents proved to be the oil majors and national governments. The majors were worried that Neste Oil might offer a real alternative to their products and that consumers might begin avoiding fossil fuels; while governments were worried about the future of their countries’ agriculture and oil sectors, says Hietala. There was even opposition within the EU, despite its commitment to free trade within the Community.

“When we started off, we had no idea that politics would play such a large role in biofuels.”

Neste Oil spent around four years in close dialogue with various official agencies and governments to put its case, and gradually began to win over their trust and approval.

Today, Neste Oil’s renewable fuels are sold in most European countries, as well as North America and some parts of Asia. What began as a start-up business has been transformed into a profitable mainstream operation generating over EUR 2.5 billion in annual revenue – and has seen Neste Oil become the world’s leading producer of renewable diesel.

Kaisa Hietala was also interviewed by Finnish national radio at Flow. Listen to the interview (in Finnish) here.