ISRAEL – Phytolon, an Israeli food-tech start-up, has raised US$14.5 million in a Series A funding round, led by DSM Ventures.
Other investors included Cibus Fund, Ginkgo Bioworks (in-kind investment in the form of Foundry services), and The Trendlines Agrifood Fund.
Current shareholders such as The Trendlines Group, Arkin Holdings, and Millennium Foodtech were also present.
Phytolon said the funding will be used to accelerate the commercialization of its proprietary colors in food and beverage applications for producers and consumers.
This funding has also become the second that the startup has secured from the US$4.1 million raised in 2020 for commercializing its fermentation-based technology for the production of food colors.
Phytolon uses its proprietary technology to produce betalain pigments via precision fermentation of yeast. fermentation of baker’s yeast.
The pigment is also used in manufacturing healthy and sustainable natural coloring alternatives to azo/synthetic dyes used in food and beverage applications.
The start-up offers a wide range of natural colors (from yellow to purple) for multiple food categories such as alternative meat, dairy, frozen products, baked goods, confectionery, and snacks.
Halim Jubran, co-founder, and CEO of Phytolon said: “The investments of DSM Venturing, Cibus Fund, and Ginkgo Bioworks open the door for broad penetration of our products in the global food industry. “
We are excited to have new investors who share our vision to create healthy, efficient, and sustainable food systems via biotechnology.”
In 2020, Phytolon claimed that the use of natural food colors is growing in demand and has presented a ‘huge challenge’ for the food industry, due to the lack of reliable alternatives to synthetics.
Earlier, Allied Market Research forecasted that the food colors market size which was estimated at USS$2.1 billion in 2019, is estimated to reach US$3.5 billion by 2027.
The market is projected to register a CAGR of 12.4% in the forecast period of 2020 to 2027, according to the market research firm.
Allied Market Research says the market growth is driven by an increase in demand for natural food colors due to the health benefits associated with their consumption.
The firm adds that with the growing health consciousness among consumers, the demand for synthetic food coloring is declining.
However, it notes that untapped raw material sources, such as cabbage and algae beta-carotene that are compliant with the regulatory mandates, offer opportunities for the growth of the food colors market.
Recently in March, Phytolon partnered with US biotech firm Ginkgo Bioworks to produce vibrant cultured food colors via yeast fermentation.
The company said it will have access to Ginkgo’s bioengineering capabilities to produce vibrant betalain pigments, the healthy and colorful compounds found in foods such as beets and cactus fruit.
The partnership was anticipated to enhance Phytolon’s color portfolio, as well as expand its vibrant color offerings in the food and cosmetics sectors.
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