Lypid Bags $4 Million In Seed Funding For Vegan Meat Fat Scale-Up Investigation

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Californian food tech startup Lypid has scored $4 million in a seed funding raise to scale their vegan fat. Green Generation Fund led the round, with Big Idea Ventures and SOSV’s Indie Bio participating, amongst others. New investment will be used to, hopefully, scale and commercialise the company’s flagship fat development, PhytoFat. More data is said to be needed to fully ascertain the viability of scaling.

Lypid’s long-term plans centre around the production of 10 tonnes of fat per year, in line with the alt-protein sector’s growth. It is one of a number of startups looking to perfect designer fats for use in plant-based meats. It claims to be taking a different approach, using micro-encapsulation of liquid plant oils with high melting points, to prevent oil leakage during cooking. 

Photo by Lypid.

The good kind of fat

Lypid claims that effective, tasty fat is what vegan meats are missing. Coconut oil, currently used by multiple plant-based meat brands, is now being replaced with more innovative substitutes. “The challenge is that vegan fats – even harder ones like coconut oil – actually still have a very low melting point, so the appearance after cooking isn’t right and the texture isn’t right as the oil leaks out,” Dr Jen-YiHuang, co-founder of Lypid explained to FoodNavigator-USA

The startup, which is a 2021 IndieBio alumn, claims to have developed a solution. Plant oils are micro-encapsulated in water, to generate ‘spongy’ fats that don’t melt at low temperatures. PhytoFat is said to function exactly like animal fats, with better retention during heating. It can be adapted to use different plant oils for requisite outcomes as well. “For plant-based chicken applications you probably don’t want solid, visible fat, so you want something more like a paste [whereas in beef products, you might want visible globules of fat distributed throughout the product,” Huang said.

Tweaking the application

Traditionally, fats would be added at the end of plant-based meat manufacturing. Lypid is experimenting with the possibility of adding it during extrusion, for better integration and cost-effective manufacturing. The depositing of mostly monounsaturated plant oils into meat is said to reduce the saturated fat levels of vegan meat products, which have previously been a concern. Lypid claims that companies using PhytoFat will be able to retail clean labelling, where appropriate and that all its ingredients are Generally Regarded As Safe (GRAS) for consumption. 

Mission Barns’ cultivated fats. Photo by Mission Barns.

Fats that function

Yali Bio is on a mission to develop its own brand of precision fermentation-based designer fats for use in plant-based meats and dairy. The Californian startup has revealed that it sees imperfect fats as part of the problem when it comes to tempting meat lovers away from animal protein. It aims to develop fully customisable clean label fats that offer better sustainability than existing options. 

Last month, Zero Acre Farms closed a $37million Series A funding round. Attracting a number of celebrity backers, including Coldplay and Richard Branson, the San Franciso startup uses fermented microbes to develop fats that are superior and healthier than standard vegetable oils.

Mission Barns is on a different track, seeking to create cell-based fat profiles. The Silicone Valley food tech closed a $24 million Series A funding round last year, to construct a pilot plant for its continued R&D. The move is the first towards commercialisation and was supported by Green Monday Ventures and Lever VC.

Lead photo by Lypid.


  • Amy Buxton

    A long-term committed ethical vegan and formerly Green Queen's resident plant-based reporter, Amy juggles raising a family and maintaining her editorial career, while also campaigning for increased mental health awareness in the professional world. Known for her love of searing honesty, in addition to recipe developing, animal welfare and (often lacklustre) attempts at handicrafts, she’s hands-on and guided by her veganism in all aspects of life. She’s also extremely proud to be raising a next-generation vegan baby.

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