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The Ÿnsect mealworm farm in France. Image credit: Ÿnsect

Insect protein giant Ÿnsect targets profitability with a new CEO and new company strategy

July 6, 2023

  • Just a few months after raising $175 million, France-based insect protein startup Ÿnsect is shuffling its leadership in order to support expansion of its “activities and strategic goals.”
  • Ÿnsect COO Shankar Krishnamoorthy will assume the role of CEO, taking over from founder Antoine Hubert; Ÿnsect stresses that this move comes “with the support of” Hubert.
  • Hubert will remain with the company as executive vice president and CŸO [“Chief Ÿnsect Officer”], focusing on “strategy, science, innovation, influence, IP and impact.”
The Ÿnsect mealworm farm in France. Image credit: Ÿnsect

‘A natural next step’

Hubert tells AgFunder News (AFN) that Ÿnsect has considered making this change for a long while, and that it signals “a new phase because we are going to grow the capacities and the revenues of the company.”

“We are now reaching the stage of running operations at large scale,” he continues.

“We have been running a small-scale factory for four years to qualify the products and technologies, building an ecosystem of suppliers, investors, and regulatory approvals. Now is the time to get to the profitability we announced in the past few months with the close [of the $175 million round].”

Ÿnsect co-founder Antoine Hubert.

At the time of that close, Hubert spoke about a new strategy for the company that includes a more asset-light business model with smaller facilities. (Along these lines, the company closed its Netherlands production facility acquired in 2021 via the Protifarm deal.)

Citing low margins in the animal feed business, which Ÿnsect has historically targeted, the company also now turns to making insect protein for pet food and, eventually, humans.

Hubert founded Ÿnsect in 2011 and has so far been involved in all aspects of the company’s development, from research to the construction of its production facility in Amiens, France. The company currently operates its vertical mealworm farms in France and the US, and has plans for expansion to other continents.

Hubert stresses that this executive shift is “a natural next step.”

“On my end, I am a scientist with no background on [growing] effectively at scale,” he says. “I want to focus where I can make the most value: the new product, new technologies, and what’s good governance on all the science and strategy paths.”

“At some point, the company grows and you’re stretched everywhere as a founder,” he adds.

‘There is no change in strategy’

Krishnamoorthy joined Ÿnsect in 2021 to lead international development and the construction of the Amiens site; he has most recently served as COO.

The timing of this executive shift is ideal, given the company’s shift in strategy and profitability goals for the near-term future, he says.

“If somebody had asked me two years ago, ‘Can you run [the company]?’ it would have been impossible, because I came from a different background.”

Krishnamoorthy has spent his career leading international industrial projects, including several multi-billion-dollar energy infrastructure projects for French utility company Engie, where he joined the executive committee.

But unlike Hubert, whose background is deeply rooted in science, Krishnamoorthy is, by his own reckoning, “not a biologist” and therefore had a learning curve to navigate when he first joined Ÿnsect.

“Even though I’ve been CEO several times, and I’ve run businesses and seen everything that makes money in multiple parts of the world, I’m not a biologist. So my first thing was to understand the biology side of things and all the stuff about the protein markets.”

Ÿnsect’s newly appointed CEO Shankar Krishnamoorthy.

Assuming the role of CEO and thereby letting Hubert focus on the science behind the business better serves everyone, he adds.

“You won’t find many with the kind of knowledge that Antoine has on insects. If you deployed that knowledge full time to making one more leap into the future, we are better served.

“Antoine’s experience is a critical because it comes with extremely deep knowledge — a knowledge that has been tested out in the environment of trying to build a business.”

Both Krishnamoorthy and Hubert insist that the leadership change won’t impact the company’s strategy or the rest of its management team.

“We’ve rearranged things in a way that the rest of the management team and the rest of the company is just the same. There is no change in strategy simply because there is a change in the level of management,” says Krishnamoorthy.

Ÿnsect is not yet disclosing investors to its most recent tranche of funding, says Hubert, but may be able to share more in a couple of months. The company is also “working on tranche two” in addition to some new patents.

In April, it signed a memorandum of understanding (MOU) with Korean food company LOTTE to explore human food applications for edible insects.

 

 

 

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