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Formo, the precision fermentation cheese company based in Berlin, has just closed a record-breaking $50 million Series A round, representing the largest to date within the European food tech industry. The startup says that the funds will boost R&D to expand its product portfolio, with animal-free mozzarella and ricotta the first on its list.
Formo has raised $50 million in its Series A round, co-led by Stockholm-based EQT Ventures, Elevat3 Capital, the VC arm of Christian Angermayer, and New York climate tech fund Lowercarbon Capital. The round, which represents the largest VC funding round to date within the European food tech sector, also saw participation from Hong Kong-based Happiness Capital, the investment arm of Lee Kum Kee Group, as well as Lionheart Ventures and Albert Wenger.
The Berlin-based food tech says the funds will be used to accelerate R&D and fast-track its path to market, as it looks to disrupt the dairy industry with its precision fermentation-based animal-free cheese.
Animal-free mozzarella and ricotta
In line with its mission to reimagine the “best of European cheese”, Formo will be using the funds to double down on product development and grow its portfolio to include European dairy specialties such as mozzarella and ricotta.
According to the firm, the products will be developed “in collaboration with artisan cheesemakers”, but will be 100% animal-free, as the food tech taps precision fermentation technology to recreate real dairy proteins without the need for slaughter, antibiotics and at a fraction of the environmental impact.
“Our excellent investor setup paired with our team of interdisciplinary experts makes us uniquely positioned to define the new gold standard of cheese,” shared CEO Raffael Wohlgensinger, who co-founded the startup with Dr. Britta Winterberg in 2019.
The food tech was initially launched as Legendairy Foods, but rebranded earlier this year as it begins to gear up for commercialisation. At the time, Wohlgensinger said the company was reaching a new stage to build a “protectable consumer brand.”
Scaling up production
The fresh funds will also allow Formo to scale up its production with a brand new pilot plant, as well as new team members to accelerate the startup’s go-to-market strategy.
According to the firm, its precision fermentation technology is easily scalable due to the 20-fold higher efficiency of microorganisms compared to conventional dairy production, and can “already undercut consumers’ willingness to pay at commercial production scale.”
Earlier this year, a study commissioned by Formo found over 70% of consumers would be willing to try and buy novel animal-free cheese products. The results were consistent across the board, by age group and by country, with the study including shoppers from the UK, US, Brazil, Germany and India.
While no details were provided as to when Formo is planning a commercial launch, it says it will soon be debuting its first products at an upcoming demonstration event.
“We are beyond excited to see our vision of a kinder, greener future come to life through our delicious cheeses as we prepare for our first product demonstration event in collaboration with Michelin-starred chef Ricky Saward,” said Winterberg.
Precision fermentation cheese heats up
Formo’s news comes as the precision fermentation cheese space begins to pick up momentum, with a number of new players hopping on board and several successful funding rounds raised by startups in the sector pioneered by Perfect Day.
US-Australian startup Change Foods, for instance, closed $2.1 million in seed funding in June, which will go towards its expansion into the Bay Area ahead of its planned animal-free cheese product launch in 2023.
The latest name to join the animal-free cheese race is Renegade Creamery, a brand developed by food giant General Mills. While General Mills has offered no further details, Renegade has revealed that it is using precision fermentation to create bioidentical casein and whey to make cream cheese, shredded cheddar and cheddar slices.
For investors, the time is now to start backing precision fermentation companies, as they look ahead to the disruptive potential of the sector on animal agriculture.
In a statement about the decision to invest in Formo, Elevat3 founding partner Christian Angermayer said the firm has “successfully demonstrated how biotechnology can be applied to create not just equally, but even better-performing products that will be price-competitive in no time.”
All images courtesy of Formo.