- Animal-free dairy company New Culture Foods closed a $25 million Series A investment round, which the company said will help it make key hires and scale up production for a planned 2022 launch. The round was led by Ahren Innovation Capital and CPT Capital, and also includes ADM Ventures, Be8 Ventures, S2G Ventures, Future Ventures, Kraft Heinz venture arm Evolv Ventures, SOSV’s IndieBio, Bee Partners, Mayfield, Alumni Ventures Group and Bluestein Ventures.
- New Culture uses precision fermentation to make an animal-free casein protein, which gives cheese its trademark stretch. The company uses this casein to make animal-free mozzarella cheese, which it plans to launch as an ingredient at select pizzerias next year.
- Animal-free dairy is quickly going from a scientific idea to something consumers can eat. Ingredient company Perfect Day makes animal-free dairy proteins, which are available in General Mills' new Bold Cultr cream cheese, as well as ice cream, cake mix, whey protein powder and cream cheese made by The Urgent Company, its CPG arm.
New Culture has been laser-focused on creating an alternative to traditional dairy-based cheese that can do more than just pass muster with average consumers. Dairy proteins are essential to the taste, texture and experience of eating cheese, co-founder and CEO Matt Gibson said in a previous interview, so the company is using technology to create a cheese that delivers those things to consumers.
In the press release announcing the funding, New Culture said that the science and product are getting there. The company has hosted several pizza tastings using the cheese that have highlighted both its performance and versatility.
With this funding round, New Culture is also getting closer to delivering the product to consumers. Not only does it bring the company a huge capital infusion and the lion's share of its funding to date, but it also forges and strengthens key partnerships. This is the second funding round that Kraft Heinz's Evolv Ventures has participated in. Kraft Heinz has deep expertise in R&D, branding, product development, supply chain and marketing, and it could benefit from having a new dairy ingredients partner. After all, Kraft became a household name because of cheese products — first prepared cheese and then its macaroni and cheese — and both companies could benefit by working together.
But two new investors in this round — the venture arms of ingredients powerhouse Archer Daniels Midland and Dr. Oetker frozen pizza — also open up vast new opportunity for New Culture. ADM has long been a backer of animal-free dairy, signing a joint development agreement with Perfect Day in 2018. The ingredient company is responsible for much of the actual production of Perfect Day's proteins, and has a wealth of experience in animal-free dairy that it could pass along to New Culture.
Be8 Ventures is affiliated with German ingredients and frozen pizza company Dr. Oetker, which has a strong presence in Europe and has plans to expand more into the North American market in the near future. If New Culture is producing cheese for pizzas, a partnership with a global leader in frozen pizza could be invaluable. Not only will New Culture be able to learn from Dr. Oetker's expertise in the space, but there may also be opportunity down the line for its cheeses to become a standard topping on the offerings, which would expand the company's reach and drive trial of animal-free dairy.