Geltor, a Californian startup using computational biology and fermentation techniques to produce collagen products without using animal byproducts, has raised $18.2 million in Series A funding.
The startup, which has focused on the cosmetics industry for its first product line — the award-winning skincare ingredient N-Collage — is set to develop products for the nutraceutical, food and beverage industries too, such as gelatin, a form of collagen often found in sweets.
And the investor syndicate in this Series A round is reflective of that; Cultivian Sandbox, the pioneer investor of the agriculture technology sector, led the round. Global food and ingredients group Archer Daniels Midland also invested via its venture arm ADM Ventures, along with Cavallo Ventures, the venture group of agriculture products retailer and ingredients business Wilbur Ellis, and GELITA, the leading global supplier of collagen proteins. Other financial investors in the round included early-stage New York investment firm BoxGroup, as well as Geltor’s seed stage investors Fifty Years, Stray Dog Capital, SOSV, and New Crop Ventures.
What is Collagen?
“It is the most abundant protein in the bodies of all animals; it is essentially the scaffolding biomaterial in our bodies that forms the structure and provides the resilience, elasticity, and strength to tissues,” says Alex Lorestani, CEO of Geltor. “For thousands of years, we’ve been using collagen and gelatin from animal waste as biomaterials. Today 70% of collagen on the market comes from pigs, 15% from cows and the rest from fish, chicken, and sheep. And it’s used in everything from pharmaceuticals to medical devices to food and beverages and increasingly in nutraceuticals and even for art.”
Most collagen on the market today is produced from the bones, skin and connective tissue of animals through a chemical extraction process that can take several months. Geltor’s process of designing and manufacturing collagen does not involve animals at all.
Under today's unique circumstances, AgFunder is re-opening Fund III for a limited time to enable investors to join our mission and invest alongside us as LPs in a second close. Learn more here.
In short, Geltor uses computational biology — via proprietary algorithms — to identify the ideal protein in nature with the best properties for certain applications. It then designs a microbe that efficiently turns plant-based sugars into that protein via a microbial fermentation process. These collagen products can be bio-designed for strength, firmness, and flexibility that you might not get with “low-grade” animal waste-based products, according to Geltor.
The “Designer Collagen” it produces are then formulated into products for the startup’s clients, which will soon include food companies.
“Instead of settling for the collagen a pig can give you, we look to find the best collagen in nature for the product,” says Lorestani. “We never have to meet the animal. We start with information about the protein sequences that span the tree of life.”
Purpose Built Process
“Geltor has taken a very practical approach in how they design their products, bringing on the right fermentation and scale-up expertise to deliver the types of volumes their customers demand; the whole business has been purpose-built for customers which was very appealing for us,” Dan Phillips, partner at Cultivian Sandbox, told AgFunderNews.
Phillips added that it was smart for Geltor to target lower volume, higher value markets in the beginning ahead of higher volume products such as gelatin as they developed the process and scaled the business.
“Another thing we liked about them is that it’s not a matter of trying to replace an existing commodity, but their objective is to make better consumer products with superior functionality to the way collagens are extracted today from fish or livestocks,” he added.
Animal-free meat product startups have gathered steam in recent months as entrepreneurs and venture capitalists hope they will present a more environmentally sustainable, and ultimately cheaper, method of meat production than through livestock raising. And the movement resonates with environmentally conscious consumers.
While parallels can be drawn, Geltor’s objective is not to make a one-to-one replacement for existing products as the cultured meat startups are. Geltor’s focus is on designing collagen products that are not readily available through traditional means. Further, Geltor does not use any animal-based products in its process, whereas cultured meat startups do.
“The main difference with the cultured meat companies is that they’re making the cells, and to grow the cells, you need to have a certain amount of animal-derived materials. We’re just making the protein, and we know the protein and every molecule that needs to go into the fermentor,” adds Lorestani.
Phillips is cognizant of the benefit of appealing to environmentally-and ethically-aware consumers, although reducing the need for animal agriculture was not a key consideration in Cultivian’s decision to invest.
“Reducing animal agriculture is not explicitly part of our thesis; we’re more broadly focused on technologies that have the potential to improve the food and agriculture industries in a meaningful way and are likely to be successful businesses. There is a segment of consumers that would like animal-free products and that will create advantages but there are many more beyond that with the tech platform.”
The Series A takes Geltor’s total funding to $23 million after it raised $4.75 million in seed funding after taking part in the IndieBio accelerator under its former name of Gelzen in 2015.