What happens when you blend 14 “phat” start-ups, 9 food corporations and a VC? (Hint: One answer might be a better mayo)

By Céline Schiff-Deb, Chief Scientific Officer, MISTA

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The MISTA Growth Hack with Big Idea Ventures

About 18 months ago, we published a blog on The oil & fat industry – ready for a shakeup? This article highlighted how critical fats and oils are to our global food system, and that the current industry pain points should prompt food companies to embrace the new emerging solutions.

But sometimes, changing the old ways of working needs a little push. MISTA, an ecosystem created to accelerate the pace of innovation in the food system, created and implemented a new approach. The MISTA Growth Hack was initiated in the summer of 2023 to break the silos and invite its entire nodal network to work collaboratively to crack the fats and oils challenges.

?In collaboration with Big Idea Ventures, MISTA selected 14 start-ups to go on a journey of exploration, validation and prototyping with corporate food players. The Hack culminated in an amazing MISTA Demo Day on November 1, 2023, at The MISTA Innovation Center in San Francisco.

To deliver a broad perspective of the various approaches currently being developed by innovative companies around the world, MISTA deliberately selected startups incorporating one of the nine “technology buckets” identified below.

For each start-up, a technical team composed of multiple stakeholders was established. The start-ups essentially were paired with food scientists and technologists from some of the world’s biggest ingredient players (Givaudan, AAK, and Ingredion), CPG companies (Danone, CJ, Conagra) and supporting technology providers (Buhler, SIG). After a series of virtual technical discussions and the exchange of recipes and samples, everybody met last October for a Hack Week in either the labs and kitchens of MISTA in SF or at the AAK Plant-based Innovation Center of Excellence in the Netherlands. During this week, the teams tested their fats and oils ingredients and developed their showcase applications. Some of them had never even tested their ingredient in an actual food, let alone work on state of the art pilot equipment with some of the world’s experts!

MISTA Demo Day was just mind blowing. It was amazing to see the 14 start-ups pitch their technologies and offer delicious food to taste, including dairy free cheeses, plant based burgers, creamy ice creams, salad dressings and even chocolate truffles. Dr. Harold Schimtz (Ex Mars CSO, Founding Partner at The March Group, Senior Scholar at UC Davis and much more) delivered the keynote address. After the event, his comment was “KUDOS?to the MISTA team for a great event - - it was one of the few truly excellent events in the world during 2023!!”

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What stood out for me?

●?????? The time for alternative oils has finally arrived – Oils are essentials to make food taste good and the global food players can no longer deny that they need better solutions. I was personally involved in a start-up active in the space 10 years ago, and it felt like a bit of a “technology push” at the time. It is really encouraging to see the shift in the food system that now creates a true “market pull” for new fats and oils. This was palpable in our own Ecosystem - when MISTA suggested the theme of its first Growth Hack to be the “Future of Fats and Oils”, absolutely all our Members rallied around it.

●?????? One solution doesn’t fit all - good news, there are dozens of solutions – Some oils are cheap ubiquitous commodity ingredients (think palm or soybean oils). However, some food applications require specific properties (e.g. melting profile, oxidative stability) that are served by more niche products (e.g. coco butter, high oleic sunflower oil, specific palm fractions). As the MISTA Growth Hack explored and animated 14 different technologies, it became apparent that each method of production can lead to very unique oil profiles that could be key unlocks for specific applications.

●?????? Start with the end in mind – If you are a start-up founder, you can’t fall in love with your technology. You must understand the market value of your ingredient(s) and your realistic costs, and check early and often with your future end customers. If there is no area of overlap between your hopes and their expectations, you need to pivot and reassess your oil target profile(s). If you don’t, you are just wasting precious runway and time. In the end, the final food product needs to deliver a great customer experience at a reasonable market value. So start by understanding the pain point(s) your new oil will solve in specific food applications.

●?????? Not everybody has the same scaling issues – One of my main learnings was that not everybody has the same scaling headaches. Coming from a fermentation background, the story often goes like 1) start at smallish scale at a Contract Manufacturing Organization which avoids CAPEX investment but leads to high production costs; 2) grow the market demand; 3) increase the production capacities and lower your COGS. It turns out that some of the technologies developed to produce these new fats and oils cannot start small. For example, some of the thermochemical approaches need to start at fairly large scales to be viable and reach price parity with commodity oils. So their market entry strategy is different – they can offer very competitive pricing on large volumes, but need substantial commercial commitment early to build their fit-for-purpose plants.

●?????? Collaboration is king, especially in the kitchen – The MISTA Growth Hack forced some genuine live connections and created transformational experiences for the 24 companies involved. The start-ups learnt a lot from the global food company’s experts: they got feedback on their ingredients, experienced “how the sausage is made” in large corporations and also saw how the other technologies in the space compared. Surprisingly (or not), the corporate members learnt a great deal as well: in a very short period they were exposed to a comprehensive sample set of new fat alternatives, and they were able to compare notes with and meet colleagues in other big food companies. Had you walked in the MISTA or the AAK innovation centers where the 2 weeks of Hack took place, you would not have been able to know what person was working in a seed-stage start-up and who was coming from a Fortune 500 company. All were working collaboratively to create delicious prototypes to wow the guests of the Demo Day.?

●?????? An activated nodal network really accelerates the innovation cycle – The 50+ Hackers and the 100+ guests who participated in the MISTA Demo Day all felt that something special was happening. Below are a few examples of concrete outcomes of the MISTA Growth Hack.

o?? One start-up totally pivoted its R&D and commercial efforts, going from a protein focus, to launching a new range of fat ingredients developed for the Hack

o?? One start-up closed some significant financing because the VC was able to meet the founder, taste the prototype and witness the positive reactions of potential end-customers during the tasting

o?? One start-up was able to access a new packaging solution usually not offered at small scale to support their commercial launch

o?? One start-up got feedback from commercial prospects during the tasting that was instrumental to nail their value proposition (and it was not just being sustainable)

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If you want to see some cool picture and read the actual words from the participants, you can click on a few of these links:

●?????? Some examples from start-ups:

????????? NoPalm Ingredient describes how diverse expertise came together to achieve something remarkable

????????? Optimized Foods introduced its innovative fat encapsulation product, HYphat?

????????? Californian food tech startup Yali Bio unveiled its precision-fermented fat at the MISTA Growth Hack

????????? Lypid showcased a new duck fat prototype developed for the Hack

????????? Cultivated Biosciences validated it first ever prototype: a coffee creamer

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●?????? Some examples from the corporates:

????????? Givaudan food scientist could not be more thrilled by the Hack

????????? Very promising solutions, I can’t wait to try them all in Danone products

????????? Big Idea Venture tasted how several of its portfolio companies worked to create better fat & oil solutions

????????? SIG’s feedback from the future of packaging angle

To finish, I and the whole MISTA team would like to thank all the many participants in the MISTA Growth Hack for making it a true success. Rest up you guys, a New MISTA Growth Hack is cooking for 2024 and we need you to be at the top of your game ;-)

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