Fermentation investment outstrips plant-based for the first time
According to Net Zero Insights data quoted by the Good Food Institute Europe, the continent’s fermentation companies have raised more than €164m in the first six months of 2024.
Those working in precision fermentation – including to derive non-animal dairy proteins – raised €49m, up from €33m in the entire 2023. The most the sector has yielded was €80m in 2022 according to the data, with €53m invested in 2021 and €7m – in 2020.
In comparison, the plant-based sector – which has traditionally attracted the largest amount of investment – managed €79m during H1 2024. The number is particularly striking when compared to the €553m invested in the segment last year, though last year’s stats include €391m worth of deals attributed to oatmilk maker Oatly.
The uptick in fermentation investment is indicative of a renewed focus in scaling up, according to GFI.
“Many of the fermentation companies that received large investments are focused on leveraging agricultural and food industry sidestreams as a sustainable feed source, helping produce food more efficiently and affordably – both of which are attractive propositions for investors,” the NGO explained.
“These companies are also using this money to help them scale up and build the infrastructure necessary to bring their products closer to commercialization.”
GFI also notes that despite not attracting the large investment it once did, Europe’s plant-based companies continue to receive large investments.
As for cultivated meat, companies raked in €45m in H1 2024, which is nearly half of the €116m raised during the entire 2023.
Which dairy companies have invested in the fermentation space?
In 2024, dairy majors Danone and Leprino Foods made strategic moves to – respectively – unlock precision fermentation bottlenecks and scale-up the production of fermentation-derived casein. In the past year, Danone has also invested in precision fermentation specialist ImaginDairy and cell cultivated milk producer Wilk.
Most recently, the French dairy major committed to developing ‘bio-based ingredients’ that can enhance the nutritional and functional qualities of its products and reduce their carbon footprint, at a new R&D center in France.
Beginning in 2025, the company will leverage a large fermentation tank, purification equipment and a demo-scale production line as it looks to ‘gradually ramp-up production and open the platform to other companies’, a company spokesperson told us. Danone is investing €16m towards the initial production line, with a scope for a second one to be installed in the coming years.
Meanwhile, Leprino Foods Company joined forces with precision fermentation specialist Fooditive Group, providing one of the largest mozzarella manufacturers with exclusive market and distribution access to fermentation-derived casein when used for cheese production.
Under the partnership, Fooditive will use Leprino’s fermenters to scale-up the ingredient’s production.
