Precision fermentation has long been seen as a potential solution to food and beverage’s biggest issues. The technology – which involves genetically-programming microorganisms to produce compounds like bioidentical proteins – can be used to create superior ingredient alternatives, helping to overcome supply shortages and formulation challenges.
Ingredients such as protein-based sweeteners, animal-free proteins like egg and whey can be extracted at a lower environmental and economic cost.
But there’s a catch. The global regulatory and investment landscape is extremely patchy, making the route to market a thorny one for start-ups in the space. In some categories like dairy, even when products have made it to retail, subdued demand, premium pricing and competition from adjacent segments like plant-based has threatened the long-term commercial viability of cow-free products.
Still, it’s not all doom and gloom. R&D efforts continue and there are signs of investor confidence rebounding. In November, The Every Company closed a $55m Series D funding round in the US to expand its egg white protein production, and Danish biotech firm Chromologics secured €7m ($8.13m) to further the development of its fermentation-derived red dye.
Earlier this year, microbial casein producer Formo received a €35m ($40.6m) backing from the European Investment Bank; Those Vegan Cowboys recently closed an investment round and continue to develop cheese alternative prototypes for the foodservice industry; and Israel’s ImaginDairy and Remilk have both helped formulate cow-free dairy products that have been launched in Israel.
Crucially, large manufacturers remain interested in the technology. Nestlé’s new center for deep tech will include enhanced capabilities in precision fermentation; Bel Group has scaled-up the production of sugar and dairy proteins with its biotech partner Standing Ovation, and Mars Snacking featured six biotechs specializing in fermentation – including two with expertise in alt dairy proteins – to its 2025 start-up accelerator, Unreasonable Food.
Greg Hocking, Mars Snacking VP of Global R&D, told us that companies who ferment alternative proteins ‘need to succeed’ – and Mars wants to support them.
“We believe this is a sustainable technology that our planet needs,” he said. “Many of the ventures we included in our Unreasonable Food cohort this year are enabled by precision fermentation. We believe it is the future of novel ingredients that are more sustainable for our planet.”
“The success of precision fermentation is critical for products such as the future of color, chocolate, sweeteners, and protein.”
Greg Hocking, VP Global R&D, Mars Snacking
The six start-ups in the Unreasonable Food cohort are:
- Standing Ovation, French start-up which produces animal-free casein via precision fermentation;
- Oobli, which uses fermentation to create sweet proteins;
- Debut Biotechnology, which ferments high-value ingredients including natural color alternatives to replace unsustainable or synthetic sources;
- Octarine Bio, makers of vibrant natural colors through fermentation;
- Hydrosome Labs, whose ultrafine bubbles boost fermentation yields and nutrient delivery, making biomanufacturing more efficient, and
- Pow.bio, who are trialing continuous fermentation.
From casein to colors: Mars’ precision fermentation bets
Bioidentical dairy proteins and alternatives to sweeteners and natural colors are the three major innovations that precision fermentation can unlock for Mars Snacking.
“Alternative proteins, like the two companies that are focused on dairy proteins, we need those to be successful,” Hocking told us, adding: “Adoption may vary across geographies and timelines, but we want to be part of that solution and support a portfolio of companies in this space.
“Progress will differ not only by geography but also across ingredient categories, each with unique considerations. We aim to help by supporting ventures as they navigate the regulatory path in this area.”
Sweet proteins and natural color alternatives are also of interest to Mars.
“One of the ventures in our cohort is Oobli, which produces a sweet protein via fermentation,” Hoking said. “This protein occurs only in very small amounts in nature, so making it cost-effective and sustainable for use in our products – whether to reduce sugar or simply delight consumers – is exciting."
“Sweet proteins made through fermentation represent a promising category of sweeteners. These innovations can help lower costs and do so sustainably, reducing reliance on traditional agricultural inputs and conserving water and land.”
Greg Hocking, VP Global R&D, Mars Snacking
Colors are of similar importance.
“There’s a lot of discussion around natural colors, and we included two companies in our cohort that focus on bioprocessing and biomanufacturing to develop the colors of the future,” he said. “These approaches can create vibrant, stable colors that are also far more sustainable than many of the natural colors available today.”
Relieving industry bottlenecks would be crucial for that technology to succeed, however: and businesses that aim to address this also formed part of the cohort. “Seeing a number of ventures have been stuck in the scale-up phase, we brought two companies into the cohort that are focused on that side of the business: Pow.bio and Hydrosome Labs,” Hocking said.
“Pow.bio is helping the unit economics by pioneering a continuous fermentation process rather than a batch fermentation process; and Hydrosome Labs’ ultrafine bubble technology delivers more nutrients to the media.”
“Both of these companies will be valuable not only to start-ups and ventures in this space, but also to many of our scaled value chain partners and suppliers focused on this technology,” he added.
“These are examples of how we’re helping ventures navigate the regulatory pathway while also investing to increase the likelihood of technical success, including through technical and economic analysis of the factors that have held back fermentation-derived ingredients from succeeding so far.”
Mars Snacking is now recruiting for its 2026 Unreasonable Food cohort. What should start-ups do to make it into the accelerator?
“We invite people to visit our website under the Unreasonable Group, where you can see the cohorts from 2024 and 2025,” Hocking explained. “While we’ve outlined key opportunity areas for next year, these industry-wide challenges don’t have a single silver-bullet solution.”
“So, we will continue recruiting ventures that address many of the same opportunities we’ve focused on in the past as we move forward.”
