NEW CASTLE – White Dog Labs, a startup biotechnology firm that produces an alternative single-cell protein for food applications, has received a new round of funding from Omani venture capitalists that it will use to continue building out its Minnesotan manufacturing plant.
The new investment was led by Sustainable Investments LLC, a venture capital firm based in Oman on the horn of the Arabian Peninsula that focuses on bringing cutting-edge technological innovation to the Middle East-North Africa region in areas related to food security, energy, and health.
Bryan Tracy, CEO of White Dog Labs (WDL), which is headquartered off U.S. Route 13, said the funding was the result of his University of Delaware grad school friendship with Mohab Ali Al-Hinai, co-founder of Sustainable Investments.
While he declined to disclose the value of the investment, Tracy said that it was designed as a series of staged investments over the next six months.
“Food security is an ongoing concern in the Gulf countries, so a sustainable, alternative protein has been of great interest to us,” Al-Hinai said in a statement announcing the deal. “We have selected WDL because it has developed a premium alternative protein that is price competitive with plant-based, and it can be produced in existing infrastructure throughout the world.”
The new funding will support the reported $15 million retrofitting of an ethanol production plant in Little Falls, Minn., that WDL purchased for about $9.2 million earlier this year. While the biotech firm envisions eventually converting the entire plant to the fermentation and production of its alternative proteins for use in animal feed or even non-meat-based products for human consumption, it has been delayed by the COVID-19 pandemic, Tracy said. For now, the plant has been restarted to produce pharmaceutical-grade ethanol while the company eyes conversion by the latter half of 2021.
“The pandemic slowed down investments into the animal nutrition space a bit,” he said, noting raising capital for both the acquisition and retrofitting of the facility was a bit more arduous.
Tracy explained that serving the feed market will require greater economies of scale to produce volumes significant enough to secure a worthwhile deal with a partner. There also is the challenge of breaking through in an industry cautious to change, he added.
One byproduct of the slowing investment into animal feed development, however, has been the expanding interest in human consumables. WDL has always been working tangentially on meat-free products that have become popular with brands like Beyond Meat and Impossible Meat, and that work will likely now take the lead in terms of development, Tracy said.
“Much of that activity that you see today in the market is plant-based, including things like peas and soybean … but we’re bringing forward a new microbiome-based protein ingredient,” he explained.
Using a protein that’s already symbiotic to our guts, it won’t have any allergy concerns and can be better loaded with nutritional value that many plant-based options lack, Tracy said.
“The alternative market has emerged, but consumers now don’t want to sacrifice on nutrition to satisfy an interest to do new or flexitarian or plant-based diets,” he said.
Tracy said that WDL’s future will include both its own branded dairy-free and meat-free products as well as seeking a partnership with a larger food company. Once fully operational, WDL could produce 1 billion meat-free burger patties annually at the Minnesota plant. With those goals in mind, Tracy said WDL would continue to seek additional venture capital.
“We want to grow fast. We want to scale and bring these products to market in a diligent timeframe to be a leader in the space,” he said.
While WDL chose its production plant in Minnesota, primarily due to the former Central Minnesota Renewables plant’s complementary design and proximity to the bountiful Midwest grain market that will be needed for full-scale production, Tracy said the company remains committed to the First State, where it employs about a dozen people.
“Delaware is a great location on the technology and business development side, because of the presence of all these multinationals that are in the markets that we’re going into,” he said.
