Animal-free dairy co Change Foods closes $2.1m seed round, gears up for 2023 launch

16-Jun-2021 - Last updated on 16-Jun-2021 at 14:25 GMT

"It's been a whirlwind of a year..." David Bucca (CEO) and Sacha Baker (VP) relocated from Australia to the US this month. Picture: Change Foods

San Francisco-based Change Foods – one of a new breed of startups making 'animal-free' dairy ingredients using microbes instead of cows – has closed an oversubscribed $2.1m seed funding round,* and plans to launch its first consumer products in 2023.

While plant-based dairy is gaining traction, players in the nascent animal-free dairy category claim they can meet demand for more ethical and sustainable products (produced without industrialized animal agriculture) without requiring consumers to compromise on nutrition, taste, texture, or functionality, particularly in technically challenging categories such as cheese.

It’s still early days, but the animal-free dairy category - pioneered by Perfect Day - is beginning to heat up, with a flurry of startups recently emerging from stealth mode including New Culture (San Francisco, CA), Remilk (Israel), Imagindairy (Israel), Formo (Germany) and Those Vegan Cowboys (Belgium).

Some are pursuing a b2b strategy, commercializing individual ingredients such as animal-free whey proteins produced via engineered fungi or yeast strains, while others are focused on consumer products.

‘Proteins, lipids and aromatic compounds’

Change Foods - founded by former aerospace engineer David Bucca - is initially setting its sights on animal-free cheese, with partnerships in retail and foodservice currently under exploration, said CMO Irina Gerry, a former Danone executive who joined Change Foods late last year.

As to what differentiates Change Foods in the space, Gerry told FoodNavigator-USA: “There are several differences in our technology and specific ingredients we are producing beyond proteins, such as lipids and aromatic compounds, our proprietary cheese production process, as well as our go-to-market strategy and the team expertise and composition.

“We are hyper focused on making critical ingredients for animal-free cheese, such as casein proteins and fats, while allowing for flexibility in other plant-based ingredients to deliver optimized product performance,” added Gerry, who said Change Foods had “initiated the GRAS process for our proteins and other dairy compounds in collaboration with the FDA experts.”

As for nutrition, she said, “Nutritional value is very important to us, as we want to create a product that is not only sustainable, but will also deliver additional benefits, so we are evaluating key vitamins and minerals to integrate into our products.”

change-foods-team — L-R: Luis Espinosa (COO), David Bucca (CEO), Irina Gerry (CMO), Sacha Baker (VP)

Change Foods is working in the emerging field of ‘animal-free’ dairy, using synthetic biology and precision fermentation techniques to insert DNA sequences into microbes that effectively ‘program’ or ‘instruct’ them to express dairy proteins and fats after feeding on a sugary substrate.

‘Consumers are hungry for more sustainable and animal-free options, but they are not willing to compromise on food experience’

While plant-based milks have captured a 15% share of the retail fluid milk market in the US ($2.5bn), plant-based cheese ($270bn) has only captured a tiny fraction of the cheese market over a similar period, because the products still don’t deliver for mainstream consumers, who would like to make more sustainable or ethical choices, but aren’t willing to compromise on taste or performance, claimed Gerry.

“We believe consumers are hungry for more sustainable and animal-free options, but they are not willing to compromise on food experience, especially when it comes to cheese… which is second only to red meat (beef and lamb) in its carbon footprint.

“This insight leads us to believe that by creating animal-free cheese that tastes, melts and stretches just like traditional animal-based dairy cheese, we can unlock significant market growth,” added Gerry, who has been spending a lot of time talking to stakeholders about how to position products in the emerging ‘animal-free’ dairy space so that they are clearly distinguished from plant-based products. (Read more HERE.)

Asked if the leftover fermentation broth can be recycled or upcycled in some way, Gerry said: “Yes, we are looking to ultimately create a zero waste production process.”

*Change Foods’ investors include Plug and Play Ventures, Clear Current Capital, Google engineer Jeff Dean, Canaccord Genuity, Better Bite Ventures, and Italian fund GERBER-RAUTH.

“For GERBER-RAUTH, the new dairy ecosystem covers traditional animal-derived dairy, advanced plant-based alternatives, and new production technologies such as biomass and precision fermentation as well as stem-cell cultivation.” Christian Pichler, chairman and CEO, GERBER-RAUTH Srl, managing director, L’INTERFORM Srl.