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The Spoon

Daily news and analysis about the food tech revolution

Aquaculture

Israeli Startup Mermade Gets Seed Funding for Its Lab-Grown Scallops

Mermade is more than just another food tech startup with a laboratory-oriented process to manufacture an alternative protein. The Jerusalem-based company’s method of using algae to create scallops has set it apart and attracted significant early-stage investment.

The company has announced an oversubscribed $3.3M seed round as it showcases a circular cellular agriculture technology for producing cultivated scallops. In doing so, Mermade attacks two problems at once: bringing sustainable, good-tasting scallops to the public at a below current market price. Most cultured meat companies struggle with the economics of meeting or beating the cost of beef, chicken, or conventional seafood.

In an interview with The Spoon, company Co-Founder and CEO Daniel Einhorn explained the differences in his company’s business and technology approach. “We thought is why not pick some meat product that eliminates as much as possible of that food engineering challenge and just focus on those huge biological challenges,” Einhorn said. “Scallops, they have a fairly similar size, and each unit is a fairly similar size and shape. And texture taste is the same all throughout the cuts. Those are huge unfair advantages compared to our direct competition– other startups trying to replicate the more complex meat products.”

Mermade says it is the first company in the world to produce scallops using cellular agriculture. The company intends to develop a product and reach laboratory-scale production by 2023, reaching consumers and restaurants after that. Mermade will use the funds to employ more stem cell and algae researchers, accelerating the company towards this goal. The scallop is the first product the company will develop out of a diverse seafood portfolio that will gradually arrive on the market.

The use of algae to recycle the cells’ growth substrate is a clear distinction for Mermade. This cellular interpretation of traditional aquaponics was termed by the company Cytoponics, and the company has filed several patent applications related to this circular production method.

Related to the cost issue, Einhorn states, “It’s a big market segment and one that it has a very high price point, which is important because the main challenge right now is driving costs down. We’re trying to integrate all parts of our design into this prototype to bring cost even close to market parity.”

“In the next few years, consumers worldwide will be able to buy cultivated scallops (Coquilles Saint Jacques) made by Mermade in a supermarket or restaurant, at an affordable price and with the same quality and taste as the original food. Using Cytoponics as our production platform, we could also produce a variety of other cultivated seafood products such as calamari, shrimp, crab meat, and more.”

The company was founded in July 2021 by Daniel Einhorn (CEO), Dr. Rotem Kadir (CTO), and Dr. Tomer Halevy (COO). Investors in the seed round include the investment platform OurCrowd, Israel’s most active venture firm; Fall Line, an American VC fund specializing in AgTech; and prominent Dutch investor Sake Bosch.

Alternative seafood—both plant-based and cell-cultured—is a hot area. As The Spoon reported in April, Good Food Institue’s report, which looks at the entire alternative seafood category across plant-based, cell-cultured, and fermentation-based products, said 2021 investment brought the total invested in the category to $313 million from 2013 through 2021. Cultivated seafood startups commanded two-thirds of all investment in alt-seafood last year at $115 million, compared with $58 million invested in plant-based seafood startups and $2 million in fermentation-based seafood.

Among the companies active in this space are Wildtype, UPSIDE Foods, Gathered Foods, and Finless Foods. With all the activity in this forward-looking space, the United States—in the form of the USDA and FDA—has yet to give the green light for sales of these lab-grown alternative proteins. Only Singapore, Qatar, and to some degree, The Netherlands have given their stamp of approval.

With European Governmental Approval, Ynsect Moves Forward With Its Plan to Feed the World, Save the Climate

Will bugs save the world?

Save may be a strong word, but Paris-based Ynsect, a producer of insect protein and natural insect fertilizers, believes in the dual mission of feeding the world and protecting our diminishing climatic resources. That vision moves a step forward with backing from a European food safety agency and data that supports a change in consumer attitudes toward a diet containing bugs and insects.

According to Ynsect’s CEO Antoine Hubert, approval by the European Food Standard Agency for Ynsect’s Lesser mealworm for human consumption will allow his company to quickly move forward with its efforts to create its line of insect-based products as well as work with third-part food manufacturers.

“Our company was born from a passion for helping tackle climate change through real solutions. Insect protein, which can easily be incorporated as a powder into a whole range of products, is healthier than plant protein and more environmentally friendly than traditional animal proteins,” Hubert told The Spoon in a recent interview. “We’re excited to see the EFSA approval come through in line with consumer demands; conscious consumers become increasingly informed of better choices for both them and the environment.”

Coinciding with the EFSA green light results from an independent research firm gave further credence to Ynsect’s timing. OnePoll, a British market research company, surveyed consumers to gauge their willingness of participants to consume insects as an alternative source of protein. At first, only 59% were open to the idea, but after learning the benefits of insect consumption, over 70% responded favorably. More than half of vegans and vegetarians responded favorably once the benefits were explained.

Mealworms are the larval form of the mealworm and Buffalo beetles, an insect that Hubert says is rich in protein and fat. The mealworm as a bug has been part of Southeast Asian diets and can reproduce prolifically. Ynsect uses vertical farming techniques to “grow” these insects and deploys chemical-free produce to turn them into a range of products, including fertilizers and pet food. Recently, Ynsect expanded its footprint by acquiring Protifarm, a Dutch mealworm producer, and then by incorporating Nebraska-based Jord Producers, a start-up mealworm farm, into its portfolio.

Ynsect’s consumer product is called AdalbaPro, a minimally processed ingredient line offering meat replacement and protein fortification solutions. Working with European partners, AdalbaPro products are already in several baked goods, sports nutrition, pasta, and meat alternatives. AdalbaPro contains all essential amino acids, vitamins, and minerals as a high-quality animal protein.

As Hubert chronicles his company’s path, not only has it shown organic growth by evolving from a fertilizer/aquaculture company to pet food and then to a product for humans, but Ynsect’s approach has also overcome the issue other alternative protein companies face in building infrastructure. The company has carefully conducted its mealworm growing processing plan, which allows it to remain nimble for an opportunity in Europe and, hopefully, after governmental approval, the U.S.

To date, Ynsect has raised more than $400 million from such companies as OurCrowd, SuperNova Invest, and Caisse d’Epargne. The company also has captured the imagination of the real-life Iron Man, Robert Downey Jr. The actor/investor recently touted Ynsect’s product on Steve Colbert’s late-night show.

(Extract) Robert Downey Jr - The late Colbert show with Stephen Colbert

UPSIDE Foods Adds Cell-Cultured Seafood to the Menu With Acquisition of Cultured Decadence

Today UPSIDE Foods announced they have acquired Cultured Decadence. The deal adds cell-cultured seafood products, including lobster and other crustaceans, to the UPSIDE portfolio.

Cultured Decadence, which was a Smart Kitchen Summit Startup Show finalist in 2020, was founded in Milwaukee the same year and will remain in the midwest, serving as UPSIDE’s ‘midwest hub.’

The news comes just a couple of months after the opening of UPSIDE’s flagship scale-up production facility in Berkeley. While the company has announced that cultivated chicken will be its first commercially available product, they have made it clear that their new facility will be able to produce a variety of different cell-cultured animal products.

“Seafood has a rich and delicious culinary tradition that makes it a favorite across the globe,” said Dr. Uma Valeti, Founder and CEO of UPSIDE Foods. “Cultured Decadence’s technology is incredibly promising, and their team is filled with passionate, smart individuals who want to make our favorite food a force for good. We’re thrilled to welcome the Cultured Decadence team to the UPSIDE family and are excited that the scientific, technological, and production infrastructure we have built over many years can help accelerate the mission impact of this team.”

One factor that may have made Cultured Decadance attractive – outside of the addition of cell-cultured seafood to the UPSIDE’s portfolio – is the difference in regulatory oversite in the US between seafood and poultry. The USDA and the FDA struck an agreement early on that the USDA will oversee the labeling framework for livestock and poultry, while the FDA will be the sole body regulating food products made with fish (except, for some reason, catfish, which the USDA oversees). Not only has the FDA had a year’s head start on the USDA in seeking public comments for the labeling of cell-cultured products, but some in the industry believe that the FDA might provide an easier regulatory glide path towards commercial availability when it comes to cultivated meat products.

Outside of regulatory considerations, it’s likely that UPSIDE’s development of its cell-cultured poultry products is further along than the much younger – and smaller – Cultured Decadence’s products, which may still require some significant cell-line development. UPSIDE has already had tastings of its products and they have been working towards commercial scale-up in their new flagship facility.

Finally, the acquisition by UPSIDE could also be an early sign of forthcoming consolidation by cell-cultured meat companies. Guessing by size of some of the recent funding rounds (including UPSIDE’s), it’s clear that the cost of bringing a cell-cultured meat product to scale will likely be in the tens to hundreds of millions, and at some point, it makes more sense for companies in this space to leverage existing investment in pilot and scale-up production infrastructure.

North Carolina’s Pearlita Foods Wants to Create Cell-Cultured Oysters

While much of the world’s sea life is under duress due to climate change and acidification, oysters have it particularly bad because of where they live. Because oysters live in coastal reefs, bays, and estuaries, acidification and other problems related to global warming are extremely difficult to solve for due to a highly varied and complicated environment.

While scientists and oyster farmers are rightly worried about the long-term survival of oyster populations and are looking for ways to help them adapt to a fast-changing environment, others are trying to think of new ways to reduce how many ocean-born oysters are consumed by humans. While traditionally that has meant a focus on hatcheries, a new startup has another idea: cellular agriculture.

Pearlita Foods is hoping to create the world’s first cell-cultivated line of oysters. The company, which has received its initial funding from Big Idea Ventures and Sustainable Food Ventures, launched this month. Its two co-founders, Nikita Michelsen (CEO) and marine biologist Joey Peters, are setting up shop in startup-friendly (and coastline adjacent) North Carolina’s Research Triangle Park.

“Not only is North Carolina the second-largest estuarine system in the country, it is also the fastest-growing biotech and future of food hub,” said Michelsen. “We will be close to the ecosystems where Oysters thrive and amongst other entrepreneurs – both which we believe will accelerate our growth.”

Over the past year, several startups have taken aim at creating new and more sustainable options for seafood, whether that be plant-based, cell-cultured, or through fermentation. One category of fish we haven’t seen is cell-cultured mollusks, but given the size of the oyster industry, it makes sense that we’d see a startup focused on creating oysters using cellular agriculture.

Another reason to celebrate the idea of cell-cultured oysters is they won’t have all the contaminants and bacteria concerns that plague natural-habitat harvested oysters. Unfortunately, oysters born in the wild are often contaminated with metals like lead, mercury, and zinc and can also be hotbeds for bacteria. Cell-ag derived oysters would be free of contaminants.

While at this point, Pearlita isn’t giving any guidance on their timelines, my guess is it will be a year or two before we see prototypes. You can follow their progress on their website.