Bill Gates is among a group of investors wagering heavily on green goop.

San Diego-based Sapphire Energy, a company working to turn algae to fuel, on Wednesday announced a seond round investment including the former Microsoft chairman that boosts the company’s total funding north of $100 million.

The funding from Mr. Gates comes from Cascade Investment, his asset management firm, and was joined by Sapphire's list of existing investors, which include Arch Venture Partners, Wellcome Trust, and Venrock.

The amount raised during the round, along with the exact total raised, was not disclosed.

Investors say Sapphire takes a different tack from rivals on algae-based fuel. Competitors such as Solazyme work with fermentation while Sapphire claims a carbon advantage.

"The fundamental advantage that Sapphire has is that it makes a carbon-neutral fuel using no agricultural land and using existing infrastructure and waste water,” said Robert Nelson, co-founder and managing director of Arch Venture Partners as well as a board member at Sapphire.

These other biofuel makers either use agricultural land or a product of it (such as sugar) or they produce biodiesel, which isn’t compatible with the current infrastructure. Sapphire’s method, on the other hand, allows the algae to be refined into gasoline, jet fuel, and diesel, all of which are compatible with the cars, refineries, planes, and pipelines available today.

Their aim is to replace crude oil.

“When you’re trying to replace what is essentially the world’s biggest product, there are many challenges in scaling,” Mr. Nelson said. “[Sapphire] is much more focused on how to scale and how to solve the many issues to come by not having to worry about financing along the way.”

With the funding, Sapphire expects to build its first 10,000 barrel a day “Green Crude” facility within three to five years.