Taste the Rainbow; Why we Invested in Michroma
Fungi working in biofactories to produce natural, fermentation-based alternatives to the petroleum-driven food dye market? That’s RAD!
Synthetic food dyes made from petroleum are staples in many American households (hello Funfetti cake mix and cherry JELL-O).
A decade ago, food dye consumption per person had already increased fivefold in the United States from 1955, with three dyes—Red 40, Yellow 5, and Yellow 6—accounting for 90% of the dyes used in foods. These dyes are petroleum-based products, which research has associated with allergic reactions and hyperactivity in some consumers. There are natural alternatives on the market, and they are expected to represent a $2.7B opportunity by 2027, but these offer lower sustainability and performance competence. Insect-based colorants, for example, nearly double processing steps with high inputs (for example, over 155k beetles are needed as inputs to produce 1kg of red colorant). Plant-based colorants like beetroot require multiple tonnage of inputs to produce 1 kg of colorant and also offer challenges associated with variables such as pH, light, and heat. The input waste in these natural alternatives is high in water, land, and pesticide use, and combined with performance concerns, leaves an opportunity for biotechnology to solve.
The team at Michroma is building an ingredient platform to produce healthier and more sustainable alternatives to the basic ingredients that bring food items to mouthwatering appeal, like colors! They leverage fungal fermentation to produce molecules for food additives. The team is beginning with the color Red+ and closely following with a full spectrum of stable and natural colorants. Their products are also thermostable, have antioxidant properties, and are vegan, Kosher, and Halal friendly.
As it relates to our thesis and impact screen, Michroma is a trifecta! They meet our impact goals of building healthier communities, reducing the food system impact on climate, and having a positive impact on diversity, as the team has Argentinian roots with strong footprints in both LatAm and the United States.
We met Michroma through one of our portfolio founders and leveraged the expertise of one of our technical advisors to dig into the team’s research approach, findings and certification plans. The team, led by Ricky Cassini and Mauricio Braia, has strong technical and business acumen and has a culture that will attract and retain the talent required to grow a global, science+impact footprint.
We were so moved by the opportunity – and the impact – that we provided a winning term sheet to lead the Seed deal. We’re joined in this round by a global list of investors with deep food/food tech expertise and look forward to working with them in support of the team as they expand the platform beyond colorants. 🌈
Learn more via TechCrunch at: https://techcrunch.com/2023/02/01/michroma-food-coloring-fungi-foodtech/