- DouxMatok, the Israeli firm behind patented technology that makes sugar taste sweeter, has rebranded as Incredo and raised $30 million in a series C round to expand its sugar reduction platform.
- The funding round was led by dsm firmenich Venturing and Sienna Venture Capital and supported by existing investors Pitango and BlueRed Partners.
- New investors include Teseo Capital, a private investment vehicle related to Ferrero, although Ferrero Group is not a participating investor, clarified Incredo. “Ferrero & Incredo have a joint development agreement to develop solutions based on Incredo’s technology and are working together in effort to launch products in the future.”
The cash injection will help Incredo expand its R&D and commercialization efforts in the US, Europe and Israel, said the startup, which recently struck deals with ingredients distributor Batory Foods and Blommer Chocolate Company, the largest cocoa processor and ingredient chocolate supplier in North America.
“Now that our flagship product, Incredo Sugar, has become commercially available and is gaining more awareness within the industry, we have decided to simplify our communications by unifying our identity under the name Incredo.”
Co-founded in 2014 by Eran Baniel and Avraham Baniel, Incredo uses an inert mineral particle (silica, which is tasteless, odorless and calorie-free) as a carrier for sugar molecules. The sucrose molecules surround and coat the particle to form structures that human taste receptors perceive to be sweeter than a comparable amount of sugar in free unassociated form, enabling sugar reductions of 30-50%.
As sugar is water soluble, Incredo’s structure breaks down in beverages or applications with high water activity. However, it retains its structure and works well in lower-moisture applications such as cakes, snacks, cookies, chocolate, candy, gummies, spreads, and protein bars, says the firm.
Incredo tastes and performs like regular sugar and can be listed simply as ‘sugar’ on the ingredients list in most jurisdictions as the carrier (silica) serves as an incidental additive and does not have to be included on product labels.
When Incredo sugar is consumed, the sucrose is metabolized as normal and the silica passes through the body and is excreted, says Incredo. However, next-generation technology using more consumer-friendly carriers is under development with an announcement on this front to come shortly, CEO Ari Melamud told AFN.
‘A huge pipeline’
Melamud added: “It’s a difficult time to raise money, and it took us a bit longer than we planned, but companies with good technologies and good go-to-market plans can always raise money. I’m really happy with the amount we were able to raise and the mix of strategics as well as financial investors.”
Incredo’s primary market is the US, said Melamud, who hired industry veteran Kelly Thompson to head its US operations last year and has recently established Incredo’s headquarters in Austin, Texas.
But it has global ambitions, he said: “We recently launched into Europe, where our business is headed up by Duska Dimitrijevic [previously at IFF, Unilever and Coca Cola]. We’re working on our launch to Asia at the back end of this year and South America is on our radar for next year.”
As for Incredo’s success to date, he said, “Over the past 12 months we’ve built a huge pipeline of almost 500 projects in the US, which includes some of the biggest brands you can imagine and we’re already in the market with some brands that for marketing reasons want to do sugar reduction by stealth. We deal directly with tier one and tier two brands, and [distributor] Batory Foods [with whom Incredo struct a deal last year] reaches tier three brands.”
Gummies, chocolate and spreads, bakery items
Incredo is about to open new application labs in the US and is seeing interest in chocolates and spreads, bakery items, and gummies, a category Melamud believes has significant potential.
“Gummies is a very interesting category. It’s growing very fast, especially in areas such as vitamin supplements for kids, but the recipes can contain 50-70% sugar. We’ve got a lot of projects in this market with some of the biggest manufacturers.”
“Incredo has developed one of the most promising innovations in the food space we’ve seen – a delicious affordable and clean-label product that can reduce the sugar in foods without additives or changes to taste.” Isabelle Amiel-Azoulai, managing partner, Sienna Venture Capital
As less sugar is required to deliver the same sweetness, formulations featuring Incredo often require the addition of bulking agents. Working with partners to help firms create clean label products using Incredo that deliver on a sensory and nutritional front has therefore been key to its success, said Melamud.
“What we’ve learned is that even some of the biggest companies don’t know how to compensate for the lack of sugar in every application with the right bulking agents. We’ve built a technical support team so that we can come to customers with full recipe recommendations so that they can reformulate without a significant increase in price.”
He added: “Based on our evaluation in the market, Incredo is the cheapest solution for sugar reduction in the market today. The cost increase [when companies reformulate with Incredo] is mainly derived from the fillers they might also use [to replace the bulk lost from reducing sugar] that can be 10 times more expensive than sugar.”
*Silica is a GRAS (generally recognized as safe) food additive that is widely used in the food industry as everything from an anti-caking agent to an emulsifier (currently the FDA permits the use of silicon dioxide at up to 2% by weight of a food).