Cell-based seafood producer Shiok Meats of Singapore has received US$12.6 million (S$17.3 million) in Series A funding - the latest alternative protein company to raise money as the pandemic pressures global food supply chains.
The new round of funding will sustain the start-up for at least three years and help finance research, development and its first plant in Singapore, according to chief executive and co-founder Sandhya Sriram.
New shareholders include Seeds Capital - the investment arm of Enterprise Singapore - and several venture capital funds. Temasek-backed fund Big Idea Ventures, which was a seed investor, did not take part in the latest round.
Start-ups and food giants around the world are racing to invent and improve alternatives to traditional meat production as consumers become more careful about nutrition and the environment.
While fake-meat companies such as Impossible Foods and Beyond Meat are raising the lion's share of funding as they expand into new markets, other start-ups are working on lab-grown alternatives for a potential pool of customers that want to eat real meat and seafood that does not come from living animals.
Shiok Meats has raised US$20.2 million in total funding, and a person familiar with the fund raising said its post-money valuation is about US$50 million.
It takes the stem cells from shrimp before multiplying them in a "culture media", a solution filled with nutrients. It is an expensive product used to make things like vaccines and is primarily sold by pharmaceutical and chemical companies. It is also a key reason why Shiok's prawn meat now costs US$3,500 per kilogram.
The start-up is researching alternative and cheaper plant-based ingredients with the goal of bringing the cost down to US$50 per kilogram in 2022, when its products will be sold to businesses like restaurants.
Challenges remain: Without finalising the recipe, it cannot lock down the exact ingredient suppliers. And the process of acquiring bioreactors, the vessels in which the shrimp meat will grow, will take a year.
"We can see so many new players coming up," Dr Sriram said of the cell-based meat sector. "The next five years will be about who survives, who makes the cut and who is able to support companies like ours make that step over to large-scale manufacturing."