Agriculture & foodtech Health, Wellness & Biotech Startups Venture

Startups Still See A Future In Familiar Foods Made With Weird Ingredients

Illustration of cultured-food app icons. Egg, sushi(?) and meat.

Food shoppers today are quite familiar with traditional foods made from nontraditional ingredients. For evidence, go to most American grocery stores and you’ll see shelves stocked with stuff like oat milk, cashew yogurt and cauliflower pizza crusts.

But judging from the ranks of funded food startups, this trend is far from over. If anything, the pipeline of new ingredients poised to hit store shelves is going to get much broader — and weirder.

How strange? In the not-too-distant future, you might be spreading bread with fossil fuel-derived butter or alga-derived mayo. The bread itself, meanwhile, might be made with flour from coffee cherry pulp.

At snacktime, you might scarf a chocolate bar made from synthetic cocoa. If that’s not enough, you could try filling up on fungi-based yogurt, or banish hunger pangs with air-derived protein.

And those are just a few of the dishes startups are cooking up — often with large servings of investment capital on the side.

Flush funding for offbeat foods

In the past few years, companies focused on familiar foods made with novel ingredients have raised billions in venture funding. While plant-based and cellular meat attracts the most coverage, other food categories have also attracted hefty financing.

To get a sense of where capital is flowing of late, we put together a sample list of 15 companies funded in 2023 and 2024 that aim to change how we eat.

Collectively, companies on our list have raised over $2 billion to date to transform substances like fungi, algae and air into things we might want to eat.

Recently plated rounds

Several particularly intriguing rounds closed quite recently.

Just last week, for instance, Onego Bio, based in Helsinki and Silicon Valley, picked up $40 million in Series A funding to manufacture egg protein through precision fermentation.

Onego describes its offering as a sustainable replacement for chicken eggs. It markets an ingredient called Bioalbumen that it says has identical taste and nutrition to chicken eggs but can be produced with a far smaller environmental footprint.

With cocoa prices recently hitting record levels, chocolate replacements are also of greater interest. To this end,  Munich-based Planet A Foods, which makes what it calls “cocoa-free chocolate” using fermented plant-based ingredients, has managed to whet investors’ appetites.  The company has raised over $43 million to date, including a $15.4 million Series A in February.

Savor, a startup that makes “agriculture-free” edible fats from fossil fuels like natural gas or captured CO₂ and green hydrogen, also secured a big round in February. The San Jose, California-based company picked up $23 million in a Series A backed by Breakthrough Energy Ventures.

Milking the alternative milk trend

The alternative milk space also continues to attract both founders and follow-on capital.

Most recently, Berkeley, California-based Perfect Day, landed $90 million in Series E funding in January to produce dairy protein through a fermentation process that does not rely on animals. The 10-year-old company, which has raised more than $800 million to date, also announced a partnership this year with Unilever to produce a lactose-free chocolate ice cream using its dairy protein.

A couple months earlier, another Berkeley company, Ripple Foods, slurped up a $49 million Series F round. The startup, which has raised more than $300 million to date, makes a plant-based milk with as much protein as dairy milk, and half the sugar.

There’s also room for comparative newcomers. In October, Sydney-based Eden Brew, which makes what it calls “animal-free, precision-fermented milk,” secured $16 million in Series A financing.

How alternative is too alternative?

One of the most fascinating stages of foodtech innovation comes when products are finally ready to market to the masses. It is then we see how far consumers’ tolerance for new ingredients, form factors and price points will extend.

As one such consumer, I’ll admit to being both intrigued and a little weirded out by some of the newer concoctions to hit grocery shelves courtesy of venture-backed startups.

This year, for instance, the heavily funded startup Nature’s Fynd, which makes a protein derived from a microbe in a Yellowstone National Park hot spring, has introduced what it calls the “world’s first fungi-based yogurt” at Whole Foods. It sounds, um … interesting.

Another well-funded upstart, Brooklyn-based Magic Spoon, now sells its reduced carb and sugar versions of popular breakfast cereals at chains like Walmart, Target and Kroger. The form factors — which mimic old favorites like Fruit Loops — look familiar. But the ingredient list, topped by things like milk protein and a sugar substitute featuring monk fruit, is decidedly different.

All in all, the current crop of unusual food startups is making a bold statement about how we think about well-known foods. By reengineering familiar form factors with novel ingredients, they’re saying food may be more about presentation than substance.

In this era, something that looks like a patty on a bun with something melted on top may still be marketed as a cheeseburger. That holds true even if it contains no meat, cheese or bread. Same goes for nouvelle versions of things like chicken nuggets, cream cheese, and, of course, milk.

Unlike the heyday of processed junk food innovation, today’s innovators tend to tout the health and environmental benefits of their products. A fermented microbe, for instance, does not require acres of land devoted to its cultivation, nor cause harm to animals. And while consumers do care about animal welfare, “microbe welfare” is definitely not yet a thing.

Related Crunchbase Pro list:

Illustration: Dom Guzman

Stay up to date with recent funding rounds, acquisitions, and more with the Crunchbase Daily.

Copy link