AXI, a spinoff from a University of Washington research group, has taken seed funding to design algae to produce biodiesel. The company is based on the work of Dr. Rose Ann Cattolico, a long-time algae researcher at the university. It already has its own proprietary algae strains, but did not make clear whether it would put the organisms to work in an open pond or closed system. Allied Minds, a local investment firm, provided the funding, but did not disclose the amount.