MycoTechnology, a Colorado-based organic food technology company, announced it received $30 million in a Series C financing round with participation from Tyson Ventures, Bunge Ventures, Kellogg's Eighteen94 Capital and Continental Grain Co., among others. The company said it will use the new funding to expand and accelerate R&D projects, bring new ingredients to market and further expand the team.
MycoTechnology says it has developed a food processing platform to turn agricultural materials into functional ingredients. ClearTaste, the company's major organic ingredient, helps reduce sugar content in products by blocking bitter tastes. PureTaste, its other product, is a sustainable, functional, and nutritional plant-based protein. Both are sourced from mushrooms.
CEO Alan Hahn told Food Navigator recent testing has shown ClearTaste can also mask any bitter metallic aftertaste associated with using salt replacer potassium chloride. As a result, he said companies might be able to include higher levels of the salt replacer in their formulations without compromising on taste.
MycoTechnology's total funding has now exceeded $80 million, and the company's innovations will benefit even more with this latest funding boost. Also potentially benefiting are big CPG companies such as Tyson and Kellogg, which may want to reduce salt in their products with the help of an organic functional ingredient made from mushrooms.
Hahn told Food Navigator the ClearTaste testing showed the amount of salt in lunchmeat could be lowered with no change in taste by combining the ingredient with potassium chloride. He said the next testing targets are soups, sauces and frozen foods.
Should those additional tests turn out well, manufacturers of such products could start lining up to take advantage of the ingredient — which explains why the company has been so successful in raising investment capital.
This is the second time Kellogg's VC arm Eighteen94 Capital has participated in a round of investment funding for the Colorado company. Following a $35 million round in fall 2017, Managing Director Simon Burton said MycoTechnology was "doing important work to ensure that a sustainable, edible protein source is more widely available to consumers."
As more applications for mushrooms are found, the global market is projected to jump from $34.1 billion in 2015 to $69.3 billion by the end of 2024, according to Transparency Market Research. Companies are looking to include the ingredient in all types of products, including foods, beverages, and even as a natural preservative.
Because limiting salt in foods is such an important issue, MycoTechnology isn't the only company pursuing salt-reduction strategies and winning accolades. DairiConcepts received an Innovation Award at the 2018 Food Tech Summit & Expo for Ascentra, a sodium-reducing flavor enhancer made from a proprietary whole milk-based fermentation process.
It's hard to know at this stage whether these innovations will make it more likely for manufacturers to achieve the Food and Drug Administration's voluntary sodium-reduction guidelines. Still, they can't hurt and might even help, especially as more investors come forward to help create new products and push them out to the market.