Dive Brief:
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Compostable packaging startup TIPA Corp., Ltd., has raised $11 million in Series B funding led by Austin and Gabriela Hearst, according to AgFunder News. Existing investors include Israeli agrifood tech venture capital firm GreenSoil Investments and the venture capital fund of Hong Kong investor Li-Ka Shing Horizons Ventures. The company has so far raised $25 million.
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TIPA's current line features compostable packaging for snack food, confectionery, grains, dried foods, vitamins, and coffee. Its current food clients include Ekoplaza, Peese Snact, Van de Halm, Jumbo supermarket chain and Shanvalley.
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Besides food industry applications, TIPA products are also being used in the fashion industry for apparel packaging, zipper bags and stand-up pouches. Gabriela Hearst — a designer of women's apparel and accessories — will be the first company to source all of its plastic packaging needs. U.K. designer Stella McCartney also uses TIPA products in her fashion business.
Dive Insight:
TIPA's stated goal is to create advanced bio-plastics materials that can return to nature after being used, similar to how an orange peel becomes a part of the food waste stream. The company explains that its key technology requirement is ensuring its bio-plastic is equivalent to traditional versions in terms of shelf life, durability, transparency, sealing strength, printability and flexibility.
In April, the company was a Silver Winner in the 2017 Edison Awards in New York City for innovation and excellence in the development of new products and services.
Compostable food packaging has been made from beets, seaweed, milk and mushrooms — and other ideas are on the drawing board. The trick has always been to balance sustainability with functionality, and today's innovations appear to be getting closer all the time.
Research and Markets has projected the global biodegradable plastics market will be worth $65.5 billion by 2022, at an estimated CAGR of 22.36% for the forecasted period. with North America being the largest consumer. The food and beverage industries are expected to play a crucial role in driving that growth.
This type of packaging can be a lucrative way for brands to gain a health halo and refresh their image without having to reformulate their products. Eye-catching, eco-friendly packaging — when done right — also can be an opportunity for companies to develop distinct branding that sets them apart from their competitors on the shelf, as well as capture loyal consumers across demographics.
This allure is prompting major manufacturers and upstart brands to develop packaging that will shrink their environmental footprint, resulting in marketplace solutions revolutionizing packaged food and beverages, which customers are buying every day.
Environmentally conscious consumers, particularly millennials, tend to pay more attention to food packaging and whether it can be recycled, composted, or has to be tossed. Companies wanting to enhance brand loyalty are wise to explore using sustainable or compostable packaging for their products.