German food-tech company Formo has secured a €35m ($36m) loan from the European Investment Bank (EIB) to scale up the production of cheese alternatives free from animal products.
The venture debt loan increases Formo’s total financing to over €135m following its $61m Series B funding round in September.
According to EIB, the quasi-equity loan will be used by Berlin-based Formo to “further develop and scale up its fermentation processes for producing alternatives to dairy and egg-based products”.
Founded in 2019, Formo uses “precision fermentation” to produce proteins mimicking those in traditional dairy products.
The start-up’s technology is said to have enabled the development of bioidentical milk proteins, particularly caseins with “good melting properties”.
Formo combines traditional fermentation with synthetic biotechnologies to efficiently produce caseins on an industrial scale, the EIB said.
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By GlobalData
The company is seeking approval to market its second-generation products in the US.
As an initial step, Formo launched its micro-fermentation product line through Metro and Rewe supermarkets in Germany and Austria last year. The company, targeting profitability in 2027, counts Rewe among its investors.
EIB vice-president Nicola Beer said: “Developing and scaling up the industrial production of fermentation-based foods is a highly innovative approach to meeting the growing demand for protein-rich dairy and egg substitutes that are free from animal products.”
Formo founder Raffael Wohlgensinger added: “We want to show that innovative European companies can move from smart ideas to scaling up and successfully marketing their technologies.
“We also know that fermentation processes will make a decisive contribution to the resilience of the European food system.”
Formo is working on other cheese alternatives, as well as an egg replacement for scrambled eggs and baked goods.
