UK-based biotech firm Clean Food Group (CFG) announces it has raised £2.3 million in funding to accelerate the commercialization of oil and fats produced using fermentation. The new capital will also fund regulatory and commercial approvals.
The round was led by international food businesses, including the Doehler Group, which previously invested in CFG, and Colombian company Alianza Team. Previous investors include the biotech VC firm Agronomics and SEED Innovations, the AIM-listed fund focused on investments in global health opportunities.
Agronomics previously invested £900,500 in CFG in June 2022. And in this round, it injected £700,000, acquiring 4.2 million shares. Jim Mellon, the executive director of Agronomics and co-chair of CFG, participated in this round with a £50,000 investment.
The international investment in this round signals that biotechnology is increasingly seen as a solution for sustainable food and ingredients. CFG alone has raised £10 million of funding to develop its oils and fats platform.
Fermenting a palm oil alternative
CFG acquired the intellectual property and the process to develop a yeast-based alternative to palm oil created by a cross-disciplinary team based in the University of Bath’s Department of Chemical Engineering as part of an investment of up to £1.8 million.
Since then, CFG specializes in producing fermentation-derived palm oil, using the non-GMO yeast already identified and used in the wine industry at an industrial scale. Its process is eco-friendly, fuelled by renewable energy, and uses food-safe waste to feed the yeast.
CFG believes it can launch its novel products in the region in the coming years since the regulatory path for non-GMOs is less stringent in the UK and EU than for genetically modified foods. The company has already signed strategic collaborations with Alianza Team and Doehler Group to scale its fermentation process to a commercial level, which now runs at 1,000 L. Another goal is to manufacture product batches required for regulatory approval for cosmetics and food applications by the end of the year.
CFG expects to complete a Series A funding in 2024 to build a commercial-scale manufacturing facility. According to the company, in the near future, it will have validated the commercial viability of its technology and have a clear sight of its revenue generation capabilities.
“We are delighted with the rapid progress the business has made in the past year. The successful conclusion of this current funding round validates the important strides our business is taking in solving critical sustainability and supply chain challenges facing our food and cosmetic manufacturer customers. We are now in a great position to validate our technology at a commercial scale, advance our regulatory pathways and develop our growing list of commercial partners in advance of our Series A next year,” said Alex Neves, co-founder and CEO of CFG.