Gavan raised $8 million in Series A funding led by Israeli venture capital firm MoreCV with participation from food and agri-tech investment firm Lever VC and private equity firm DarkBoot Group.
Additionally, Gavan will launch its first pilot production plant in Europe in April 2025, with 200 metric tons of manufacturing capacity, Itai Cohen, co-founder and CEO of Gavan, told FoodNavigator-USA.
“The next step for us will be to build facilities next to our strategic customers,” including possibly in the US and Europe, he said.
“This funding basically opens the door for us to really engage with customers, to really start testing our products in application, and test the consumer reaction to it,” he added.
Fatrix’s versatility extends from bakery to hybrid meats
Fatrix is an emulsion made from protein isolate, vegetable oil and water, designed to reduce total and saturated fat content, Cohen explained. The versatile ingredient has a neutral odor and taste and maintains stability and fat- and water-holding capacity even during manufacturing, he said.
“Our technology allows us to extract the proteins without changing their physical dimension, and when we do that, we achieve better properties,” Cohen elaborated.
“When you look at consumer preferences, they want healthier food. They want it sustainable. They want to pay less for it. They want it to have a better impact on the planet, and that is something that is not going to change anytime soon."
Itai Cohen, co-founder and CEO of Gavan
Gavan is focusing first on bakery and dairy applications, given the ingredient’s ability to serve as a one-to-one replacement for butter, while also exploring how Fatrix can improve the nutritional profile of animal- and plant-based hybrid meats and dairy products, Cohen explained.
Consumer demand for sustainable products ‘is not going to change anytime soon’
At the same time Gavan is scaling its business, the plant-based category is still finding its footing after the initial market hype during the pandemic.
Plant-based dairy alternatives sales hit $16.8 million for the year ending Aug. 10, 2024, according to Circana data shared in an FMI - The Food Industry Association report, up from $16 billion from the year prior. However, plant-based cheese continued its backslide, with unit sales decreasing 8.7% and dollars 10.6% for the year ending July, according to Circana data shared during an International Dairy Deli Bakery Association webinar.
Additionally, meat alternatives achieved $1.1 billion in sales for the year ending July 14, higher than pre-pandemic levels, according to a Circana report. Brands like Daring, Abbot’s, Meati and Beyond Meat increased sales by $1.5, $2, $2.7 and $10.2 million, respectively, for the same period.
Despite the US market being “bumpy,” consumers still demand healthier and more sustainable food, a trend that will propel demand for plant-based products moving forward, Cohen noted.
“When you look at consumer preferences, they want healthier food. They want it sustainable. They want to pay less for it. They want it to have a better impact on the planet, and that is something that is not going to change anytime soon,” Cohen elaborated.
