CHICAGO, Ill. – April 6, 2023 – Food tech startup Aqua Cultured Foods today announced it has raised $5.5 million in seed funding to bring its ultra-realistic seafood alternatives to market.
The round was led by Stray Dog Capital, a venture capital fund specializing in alternative protein investments, with participation from H Venture Partners, Aztec Capital Management and Amplifica Capital, along with follow-on investment from current investors Supply Change Capital, Big Idea Ventures, HPA, Aera VC, Kingfisher Family Investments, and Swiss Pampa. The round also included a strategic investment from CJ CheilJedang, a South Korea-based global food and bio company owning renowned brands such as Bibigo.
Aqua will use the investment to equip its new facility, scale up production, bring products to market, add key talent, and expand its roster of restaurant and foodservice outlets for product introductions this year.
“We appreciate having mission-aligned partners that offer strong strategic value for the next phase of our growth, which will involve building up the business and brand,” said Anne Palermo, CEO of Aqua. “Being good stewards of investor capital is important to us, so along with hitting milestones earlier than expected, we are benefiting from government programs, academic resources, and other advantages to get to market quickly.
”Aqua’s primary value is its low cost of scaling and its path to price parity, thanks to proprietary fermentation methods that use relatively affordable inputs and equipment. The company recently acquired a food-grade facility that was already built out nearly to its requirements—which it estimates will save more than a million dollars in construction costs.
Aqua was recently accepted into the Illinois Office of Business Development’s EDGE program that provides tax incentives to growing companies, which will save hundreds of thousands of dollars in taxes over the next 10 years.
“The adage is true that early-stage funds heavily weight investment conviction in people, and less in technologies or products given the embryonic nature of companies at these stages, but Aqua already boasts strength across its team, product, and key partnerships already in place,” said Johnny Ream, Partner at Stray Dog Capital. “We are interested in backing founding teams leveraging unique technologies and approaches that drive a more sustainable future; the work Aqua is doing with alt-seafood has immense potential to drive both human and planetary benefits in a massive $100B+ global market.
”The global plant-based seafood market was valued at $42.1 million in 2021, and is projected to reach $1.3 billion by 2031 with a CAGR of more than 42 percent as wild fish stocks are further depleted. In addition to depleted fish populations, commercial fishing practices result in damage to ecosystems, plastic waste, and “bycatch” of non-target species. As fish farming increases, so does habitat destruction, pollution and diseases spread to wild fish, and the industry’s reliance on antibiotics and wild-caught fish for feed.
Despite its health halo, fish contains microplastics, mercury, pesticides, antibiotics, dioxin and PCBs. High in cholesterol and saturated fats, seafood, in particular finfish, is a good source of foodborne illness caused by bacteria, viruses and parasites.
Aqua is developing calamari, shrimp, scallops, and filets of tuna and whitefish with proprietary mycoprotein fermentation processes that do not use any animal inputs, genetic altering or modification. Unlike plant-based processed foods formulated with starches and protein isolates, Aqua’s alt-seafood retains its naturally occurring fiber, protein, and other micronutrients. The company also produces minced “seafood” fillings for applications such as dumplings, ravioli, and sushi rolls.
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About Aqua Cultured Foods
Aqua Cultured Foods is an innovative food technology startup developing the world’s first whole-muscle cut seafood alternatives created through microbial fermentation. Its novel technology produces a sustainable, complete protein source using only a fraction of the resources required by traditional aquaculture. As an R&D company with a focus on product commercialization, Aqua Cultured Foods occupies a unique position in the burgeoning alt-seafood market as well as within the fermentation industry. The company’s mission is to mitigate global challenges such as overfishing, climate change and feeding the world’s expanding population with delicious, nutrient-rich foods. For more information visit https://www.aquaculturedfoods.com.
About Stray Dog Capital
Stray Dog Capital is a venture capital fund investing in innovative, early-stage companies across the food, beverage, and biotechnology sectors that are driving a healthier, humane, and more sustainable future. Stray Dog Capital supports its portfolio of investments with broad experience from its team as entrepreneurs, operators, advisors, and investors. www.straydogcapital.com.