Dive Brief:
- Precision fermentation ingredients maker Michroma raised $6.4 million in a seed round to fast-track its commercialization of a natural red coloring for food and beverage. The round was led by Supply Change Capital — which received some of its funds from General Mills venture capital arm 301 Inc.
- Michroma seeks to replace petrochemical-based red coloring ingredients with its Red+ ingredient, which the company says is temperature resistant and stable at any pH level.
- Michroma is one of many companies using precision fermentation to create a natural ingredient that is either not found abundantly in nature or requires animals to produce.
Dive Insight:
Michroma uses a combination of biotechnology and precision fermentation to make a natural red color that it says can perform well in a variety of food and cosmetic items. The company uses CRISPR gene editing on fungi to make it so they secrete vibrant dyes when placed in a bioreactor, The Spoon reported.
The investors in Michroma’s seed round are well placed to help the company grow and develop, as well as to get its colors adopted in the CPG space. Supply Change Capital, the lead investor, is a woman and Latina-run venture fund that focuses on food companies at the intersection of technology, culture and climate. Through Supply Change Capital’s relationship with 301 Inc, Michroma is in a primary place to be noticed by General Mills.
But other investors in Michroma occupy prominent places in the food tech world. Investor Be8 Ventures is a fund backed by German ingredients and frozen pizza brand Dr. Oetker, which is a household name in Europe. Dr. Oetker has manufacturing and distribution experience and knowhow throughout Europe, as well as products that could showcase a natural red coloring.
CJ CheilJedang, a Korean company that is a leading supplier of fermentation-based bioproducts for food, also participated in the round. This company can share its fermentation knowledge with Michroma, as well as connect it to brands and manufacturers in Asia.
Stable and affordable natural food color options are poised for growth in coming years. According to Fact.MR, the global natural food color market is expected to nearly double in value in the next decade, worth $4.1 billion at the end of 2033 from a projected $2 billion this year. Consumers are looking for cleaner label solutions for ingredients in their food, and studies have shown that artificial colors in food may have a connection to ADHD in children.
Michroma is ramping up to be able to replace some of artificial colors in the next several years. Founder Ricky Cassini told TechCrunch that the company has prototyped Red+ with some large food companies and is in negotiations with suppliers. Michroma plans to submit regulatory petitions to the FDA and European Food Safety Authority for a regulatory process that the company expects will take at least two years.
