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The Spoon

Daily news and analysis about the food tech revolution

Israeli

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.

Israeli Company Wants to Create a Greener Future Through Compostable Plastic

Like many transformative ideas, the genesis behind TIPA, an Israeli company with a novel way to reduce plastics in the environment, came from the need to solve an obvious problem. Daphna Nissenbaum, TIPA’s CEO, and co-founder was bothered by the mountain of plastics around her and wanted to find a solution that would benefit her son and others moving forward.

“If you think about nature’s packaging, such as an orange peel, or banana peel,” TIPA’s vice president for North America, Michael Waas, told The Spoon in a recent interview. “We don’t see the Mt. Rainier of banana peels or orange peels because they all break down. And so (Nissenbaum) thought, ‘I need to do something about this for my kids’ and turned her focus on finding a compostable solution inspired by nature.”

For TIPA, it’s all about flexible plastics—those water bottles and food packaging that may wind up at a recycling center but are challenging to become part of a circular economy where materials can be reused for another valuable purpose. Founded in 2010, TIPA’s vision for flexible packaging is to create compostable packaging with the same qualities as conventional plastic, such as durability and shelf life. In particular, for food packaging, compostable material will add days to the freshness of bagged produce and other foods.

Waas explains that TIPA uses polymers that are both bio-based and petroleum-based, which seems contrary to the company’s overall mission. “You’re probably thinking that doesn’t make any sense,” Waas said about petroleum-based polymers. “You can have fossil-based, petroleum-based polymers designed to be fully compostable and bio-based polymers that are not compostable. So, it’s two different challenges. One is the source of the material, whether it’s coming from oil or a bio-based source, and then what happens to it at the end of life. And so TPA uses a combination of both bio and fossil-based, but absolutely everything we produce is certified compostable.”

“We spend a lot of time working on what works and what doesn’t,” Waas added.

TIPA takes a broad approach to the business side of creating a viable system for the circular economy. The Israeli company can manufacture packaging for clients or provide the compostable film to clients or their packaging partners. “We focused on developing the IP and the technology around the solutions. Then, we work with best-in-class manufacturing partners to produce the film or the laminate,” Waas said. We’re doing that because it allows us flexibility for customers.”

The EPA points out that composting enriches the soil, helping retain moisture and suppress plant diseases and pests; reduces the need for chemical fertilizers; encourages the production of beneficial bacteria and fungi that break down organic matter to create humus, a rich nutrient-filled material, and reduces methane emissions from landfills and lowers your carbon footprint.

Creating a compostable future is an obvious path to a greener world, but are consumers ready to make an effort to go through the process of composting? Several surveys indicate that most consumers would compost if it were more accessible. More than 180 communities in the U.S. have composting programs, including such cities as Portland, San Francisco, Boulder, and Seattle have city-wide composting programs.

Even with the ready availability of municipal composting programs and consumers’ general sense they would use composting if made available, Waas believes that consumer education is critical.

“We work with our customers to help them communicate that the package is recyclable because we want this packaging to end up in the right facility, whether that’s in somebody’s backyard or at an industrial compost facility,” Waas said. “And that means consumers have to know that it’s compostable and put it in the right place.”