These companies are across the food supply chain, from agriculture, crop health to protein alternatives. Bits x Bites backs start-ups up to Series B.
One of them is Israeli food tech company InnovoPro, which developed a proprietary extraction process to concentrate protein from chickpea.
The company claims its chickpea protein concentrate is an alternative protein source and is high in protein, fiber, iron and essential amino acids.
Its ingredient has been incorporated in ice cream, plant-based burgers and energy bars across US, Europe and Israel. Most recently, Swiss retailer Migros launched a dairy-free yoghurt line containing InnovoPro’s chickpea protein.
Furthermore, chickpea is a more sustainable crop associated to lower water usage and carbon footprint.
Bites x Bites’ founder and managing director, Matilda Ho told FoodNavigator-Asia, chickpea protein concentrate was still a novel ingredient in China.
“Because of its water efficiency in its plant production, there is concerted effort to raise the production of the chickpea crop in China, particularly in northwestern China. We’re excited for chickpea’s potential in China’s food industry.”
InnovoPro recently raised US$18 million in its Series B funding, which will be used for R&D, commercialisation, and production engineering.
Bites x Bites also invested in Mojia Bio, a Chinese company producing essential nutrients using its proprietary bio-manufacturing process. Essential nutrients are nutrients that the body is unable to synthesise and must be obtained from natural or synthesised foods, this includes carbohydrates, proteins, fats, vitamins, and minerals.
Ho said, “We are drawn to Mojia for its bio manufacturing technology (which) has a much cleaner environmental footprint than traditional approaches. (Furthermore), its conversion rate and production efficiency are significantly better than conventional production, and therefore more cost effective.”
This is significant because China is a global producer of animal and human essential nutrients. However, the chemical synthesis process typically produce by-products that pollute the environment.
According to Ho, the firm believes a bio-based manufacturing approach is a viable path forward to capitalise on China’s position in the global market and to enable sustainable nutrient production for the future.
Mojia Bio recently raised over RMB 100 million (US$15m) in its Series A round which will be used to build its manufacturing capacity and R&D.
Bits x Bites has also invested in UK-based Tropic Biosciences, a CRISPR gene editing company developing more resilient and disease resistant crops.
According to Ho, China is one of the world’s largest users of agricultural pesticides, which leads to negative impact on soil erosion as well as farmers’ health.
Ho explained: “Breeding technology like CRISPR can be a powerful solution in enabling pest- and disease-resistant crops to reduce the chemical inputs on the farms.”
She cited the panama disease which has threatened extinction of the Cavendish bananas, and where pesticides such as fungicides were ineffective. The panama disease has already affected bananas in China, mainly in Guangdong, Hainan and Yunnan.
“The challenges Tropic are tackling are vital to food security in China and globally.”
Tropic Biosciences has raised US$28.5 million in its Series B round, which will be used for R&D and field trials.
Future of food
According to Ho, the VC hopes to invest in more companies within the agriculture, midstream supply chain and functional foods space.
Health and nutrition was a main area of concern. “More than 11% of China’s adult population is diabetic, and one in five children is obese.”
“Our interest here is bioscience and patented food processing that will introduce new functional ingredients, or reduce the use of sugar, salt, and fat without compromising on taste. This includes applications that will elevate the health and sensory performance of animal-free protein alternatives.”
Ho added that China has impressive downstream investment as seen in the strong e-grocery and food delivery penetration, however “without investment in upstream innovation, we won’t see meaningful improvement in farm production efficiency to sustain the rapidly growing food demand.”
“Since the trade war and African Swine Fever, self-sufficiency in food production has become a national priority. For agriculture, we are looking at IOT and bioscience solutions that can help producers improve yield while reducing input, address soil degradation, and protect animal, crop, and farmers’ health.”
In terms of midstream, Ho said China’s cold chain logistics cover only 19% of production, far below other developed countries which exceed 95%.
“We are looking at how automation and data can improve food safety and cut down spoilage in storage, processing, and transportation.”
Bits x Bites has raised US$30 million in the first close of its new US$70 million fund, backed by Temasek, Heritas Capital Management, Monde Nissin’s CEO, among others.
The VC anticipates a final closing in the next six to 12 months.
Ho said the firm is in discussions with new investors to join its second close.