FoodTech Weekly #182 by Daniel S. Ruben

FoodTech Weekly #182

Hi there,

I wrote this in February 2021, i.e. three years ago:

'Looking at the explosion in startups, investors, incubators, academics, and corporates in the plant-based and cell-based alternative protein space from January 2018 to January 2021, I can't help but think there's a bubble brewing. While it's clear this ecosystem is here to stay, and that it will capture significant market share, I think some less sophisticated entrepreneurs and investors are entering this space, and that will not end well.’

I think my forecast was right. The bubble burst. But the ecosystem is still here to stay.

This week's rundown:

• Major funding rounds by alt chocolate startups Planet A and Voyage Foods

• New report by EAT Forum says transformed food systems could yield $10 trillion benefit

• New world record set for the fastest time to drink a cup of coffee

Let's go!

Conversations

‘My whole journey has been to use science to make food better for people and the planet. How can we take foods that we love, that are currently considered unsustainable or unhealthy, and make them sustainable and healthy?’ This says Alan Perlstein, Founder and CEO of California Cultured, who I recently spoke with.

Alan started his career working in a U.S. lab for cell-cultured fish, in 2003 in Long Island, New York: ‘I applied to hundreds of labs; they all turned me down because I didn’t have experience. One lab accepted me. There and then I fell in love with the technology of cell-cultured food’, Alan says.

He kept working in labs, designing biological drugs, until eventually starting Miraculex (now called Oobli), which developed a new class of sweetener, raised $32M, partnered with food giants like Kraft Foods and Coca-Cola, and more. Alan left to start California Cultured in 2020.

‘The cocoa industry leads to massive amounts of deforestation. And there seems to be over a million child laborers being forced to work on cocoa farms. The EU has brand new rules against deforestation-linked cocoa and coffee. At the same time, India, China, Africa and LATAM are seeing increased demand for chocolate and coffee. So we’ve got a situation with tightening supply and increased demand. I saw an interesting opportunity to rebuild the chocolate industry supply chain using plant cell culture. You take a cutting from any plant like cocoa, and can create cocoa butter, solids, and bioactives — we can satiate world demand’, Alan explains.

California Cultured identifies the rarest, most difficult to grow cocoa beans with the most desirable flavor characteristics; then the company isolates key cells, grows these nano sized cocoa cells in a media, which is mostly sugar and water with a little bit of plant derived ingredients, to make the cells replicate and divide, and after a few days everything can be harvested. Excess water is removed, and what remains is cocoa powder, which can be then processed to different end products . A similar process can be used for producing other things — coffee, vanilla, saffron, nuts, rubber, anything. The ingredients are then used in food, pharma, cosmetics, and materials. The entire process is non-GMO.

‘We didn’t want to be the everything company’, Alan says and continues: ‘So we decided that the initial product will be flavanol cocoa powder. I think that in the future, production of these ingredients, whether cocoa, coffee, vanilla, saffron, or other things, will be local. So you can have domestic production in Finland, England, anywhere - customized to local user taste and preference.’

California Cultured, which is currently working through the regulatory processes, will sell its ingredients B2B to partners. And they are looking to bring new bioreactor technology to market as well. Later this year, the company hopes to launch a couple of high-flavanol products with Japanese chocolate manufacturer Meiji. Flavanol is priced at $700/kg, and companies may also use health claims for flavanol, as it has been clinically shown to reduce the risk of cardiovascular events.

The company currently has 19 team members, mostly scientists. California Cultured has raised $7.5M so far, and is in the midst of raising a $10M Series A round (anchored by ADM), to achieve regulatory approvals, start and scale production, and generate revenue.

California Cultured is still open to talking to mission-driven investors. They’re also looking for amazing scientists, all over the world, as their niche of plant cell culture is very rare. And they want to connect with companies in industries like chocolate, coffee, ingredients, and beauty. Alan can be reached via email.

Noteworthy

• Inari of Cambridge, Massachusetts has secured $103M in new financing. The company uses AI and gene editing (e.g. CRISPR) to breed seeds that can produce the same or greater yields while using fewer resources.
  

• Israeli startup Bluewhite has banked €39M (appr. $42M) in Series C funding for its technology that can retrofit existing tractors into autonomous robots, thus saving farmers labor costs. The round was led by Insight Partners.
  

• Alt chocolate news #1: Planet A of Munich, Germany has bagged a €15.4M (appr. $16.7M) Series A round led by World Fund. The company ferments oats and sunflower seed into its patented cocoa alternative product ChoViva, which is free of cocoa beans. I interviewed Planet A’s co-founder Max back in Sept 2021, and also did a podcast with his co-founder (and sibling!) Sara in Jan 2022.
  

• Alt chocolate news #2: Voyage Foods of California has fetched $22M in fresh funding from backers like Valor Equity Partners and Horizons Ventures. Voyage develops and sells e.g. cocoa-free chocolate made from grape seeds, sunflower protein, RSPO-certified palm oil and shea kernel oil.
  

• InspiraFarms Cooling of Kenya has drummed up $1M in investment to help expand its off-grid cold storage network across Africa. Investors in the round included CEI Africa, KawiSafi, and Factor[e]. The investment comes just a month after the company secured $5.4M from InfraCo Africa to pilot its Cooling-as-a-Service model across Kenya, Zambia, Zimbabwe, and Ghana.

• Indian aquaculture news #1: AquaExchange of Vijayawada, India has reeled in a $6M Series A round; the company offers various hardware devices as well as an app that provides monitoring, procurement, sustainability advice, and financial services for the country’s aquaculture farmers. The new cash injection was led by impact investor Ocean 14.
  

• Indian aquaculture news #2: Chennai, India-based Aquaconnect which supports fish and shrimp farmers with remote monitoring and access to cold storage, logistics, and buyers has clinched $4M in a pre-Series B round led by S2G Ventures.

• Elo Life of North Carolina has raised a $20.5M Series A extension from DCVC Bio and Novo Holdings. The company’s first product, launching in 2016, will be a natural, monk fruit-derived sweetener that Eli Life claims is 300x sweeter than sugar but without the calories.
  

• A new landmark study by EAT Forum says that moving to sustainable food systems could bring $10T (trillion!) benefits a year.
  

• Chef Robotics of San Francisco has harvested almost $15M in funding, which will be used to advance the company’s Robotics-as-a-Service (RaaS) model and expand its team.

🥡 Leftovers

• Eatable Adventures makes first close of €30M fund which will invest in AgriFoodTech.

• Apollo Agriculture of Kenya banks $10M in funding to provide farmers access to financing, high-quality farm inputs, insurance, and tailored advice.

• 12 EU ag ministers have formed a coalition against cultivated meat.

• Crysp Farms of the UAE has scooped up $2.25M to build more hydroponic farms.

• Finnish food education startup Vegemi has landed €500K (appr. $550K) in funding.

• The EU may loosen rules on gene edited crops.

• AgTech funding slowed in Q4 2023, Pitchbook says.

• Swedish land-based Arctic char grower Cold Lake secures €28M EIB loan.

• Gen AI can predict how food will impact your blood sugar.

• Corral Tech of Nebraska bags $1.38M to expand virtual fencing solution for cattle.

• CRISPR could yield the next blockbuster crop.

News from the FoodTech Weekly community

• GFI (U.S.) is hiring a VP of their U.S.-based Science & Technology team… Project Eaden (Germany) has several open roles incl. Research Lead, Senior Food Chemist, and Senior Product Developer… Djuce (Sweden/U.S.) is looking for a Sales & Marketing Manager, California… FoodLabs (Germany) is on the hunt for a Scientific Founder at a Soil Health Venture, and a Chief of Staff for an Alt Protein Fermentation Venture… Nitrofix (Israel) is recruiting a Research Engineer… Stockeld Dreamery (Sweden) is hiring a Head of Accounting… Aqua Cultured Foods (U.S.) has an opening for a Senior Food Scientist… Opalia (Canada) is bringing on a Financial Associate.

• Applications are open for the WFPs Stability-and-Peace Accelerator Programme as well as for the Katapult Ocean 2024 Accelerator batch.

• Sweden FoodTech Big Meet is back, April 9-11, 2024 in Stockholm, Sweden. The event convenes everyone from innovators, chefs and investors to farmers, activists, and policymakers, and features a Summit program, a Test Kitchen, an exhibit, and a pitch event. Use the code Earlybird for 20% off - register here.

• Are you looking to streamline your strain development? The Novel Strain Engineering & Development for Alternative Proteins Summit (March 26-28, San Francisco) is the event for you. Hear from over 15 world-class speakers, for 3 full days of thought leadership and 6+ hours of networking. Discover more and secure your place here.

Want to share some FoodTech news/project with other FoodTech Weekly subscribers? Hit reply.

Random Stuff

• Actual footage of me emerging from the 2023 holidays eating bonanza:

angelo_dorny

View more on Instagram

• Speaking about pigs — a family pet pig called Kevin Bacon on the run for 18 days in Pennsylvania was lured home with a sticky bun laced with Benadryl. Kevin Bacon the actor helped point out to his followers that his namesake was missing.

• Uplifting (?) headline of the day: Seaweed could save a billion people from famine after a nuclear war.

• Saudi Arabia allows first alcohol sales — but only to diplomats.

• A Frankfurt man called Felix von Meibom has set a new record for the fastest time to drink a cup of coffee — 3.12 seconds (shaving 0.05 off of the previous record):

​I love you.
Daniel

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This issue was produced while listening to Stolen Dance by Milky Chance. Follow me on LinkedIn and Twitter. Did your brilliant friend forward this to you? Subscribe here.

Disclosures: I'm founder of Solvable Syndicate. I’m an operating advisor to VC/investment firms Nordic FoodTech VC, Mudcake, and Blume Equity. I'm a mentor at accelerators Katapult Ocean, Big Idea Ventures, and Norrsken Accelerator. I'm an advisor to BIOMILQ, FoodHack, Hooked, Ignitia, Improvin, IRRIOT, Juicy Marbles, Lupinta, NitroCapt, Oceanium, petgood, Rootically, Stockeld Dreamery, Transship, VEAT, and Volta Greentech; in some of these startups, I have equity.

Boring disclaimer: The newsletter content is intended only to provide general and preliminary information to folks interested in FoodTech, and shall not be construed as the basis for any investment decision or strategy. I assume no liability in regards to any investment, divestment, or retention decision taken by readers of this newsletter content.