VanDyne SuperTurbo Inc., a stealthy company that claims it has developed a technology that can boost fuel efficiency by 25 percent, said Tuesday it is looking to raise $12 million in its first round of financing.

For now the Fort Collins, Colo.-based company is keeping a tight lip on its technology, Barbara Naranjo, vice president of corporate relations for VanDyne, told Greentech Media at the Cleantech Forum in Washington, D.C.

But Naranjo explained that VanDyne is developing an engine product that in part combines elements of a supercharger and a turbocharger.

Both technologies compress the air flowing into the engine, boosting a car's performance. VanDyne said its technology would make it possible to power cars with less fuel-hungry engines that are 30 percent to 50 percent smaller, said VanDyne CEO Edward VanDyne.

A turbocharger 's compressor is run by a turbine that is driven by the engine's exhaust gases, whereas a traditional supercharger is run by the crankshaft.

VanDyne's technology also draws on what is called turbo compounding, where a turbine takes waste heat from the exhaust to power the crankshaft of the engine.

VanDyne was founded in June, but the company has been doing research and development for four years, first as part of an industrial controls company in Northern Colorado, Naranjo said. VanDyne needs the money to complete its spin off from its parent company, which Naranjo declined to name. It is working out a deal to license the technology from its parent company.

The $12 million VanDyne plans on raising will help the company develop a pilot manufacturing line for the technology. Naranjo said the funding will last about 18 months.  The company hopes to raise a total of $50 million over the next five years, she said.

Of course VanDyne isn't the only company looking to boost the vehicle-fuel efficiency of gasoline-powered vehicles.

Among those looking to give hybrid technology a run for the money are companies such as MCE-5. The French company claims its 1.5-liter, four-cylinder engine can lead to a 35 percent fuel economy savings, according to Business Week.