Better Meat Co. receives $1.5M DoD grant for mycoprotein plant

California-based The Better Meat Co. has received $1.5 million from the U.S. Department of Defense to expand its production capacity with a new mycoprotein facility.

US food technology startup The Better Meat Co. has received a $1.48 million grant from the Department of Defense (DoD) to scale up its mycoprotein component in meat analogues.

The funding was part of the government’s Distributed Bioindustrial Manufacturing Program (DBIMP), which aims to expand the United States’ fermentation capacity to strengthen the defense supply chain in five key areas: food, fuel, fitness, firepower, and manufacturing.

Better Meat Co. produces Rhiza mycoprotein from Neurospora crassa, a strain of fungus used in traditional fermented foods and beverages such as Brazilian tiquira vodka, Indonesian staple oncom, and Roquefort cheese in southern France.

The company plans to use the capital to expand its manufacturing capacity and open a new biomanufacturing facility for its sustainable, fiber- and protein-rich ingredient. The location of the plant has not yet been determined, according to the DoD.

“The United States will benefit greatly from taking a leadership role in biomanufacturing, especially when it comes to efficient and innovative ways of producing food,” said Paul Shapiro, co-founder and CEO of The Better Meat Co.

Good developments for The Better Meat Co.

The investment comes weeks after The Better Meat Co.’s Rhiza ingredient received a “no questions asked” letter from the Food and Drug Administration (FDA) granting its mycoprotein GRAS (generally recognized as safe) status.

But the product has been on the market for some time now, as the company has been granted GRAS status, allowing it to supply the protein ingredient to Northern California restaurants for steaks, carne asada and foie gras analogs.

Its older plant-based protein has been part of Perdue Farms’ Chicken Plus blended meat line since 2019, but meat analogs from Rhiza — derived from filamentous fungi — are being developed by companies like Hormel Foods and Maple Leaf Foods. The company has signed multiple letters of intent and offtake agreements with major CPG brands in the U.S. and Asia.

On a dry weight basis, Rhiza contains 30g of fiber and about 45g of protein per 100g, with a protein digestibility index of 0.87-0.96 (similar to casein, beef, and egg). According to the GRAS note, mycoprotein can be used to produce beef, pork, chicken, and seafood analogues.

The company also recently switched to a continuous fermentation approach, which involves putting materials into bioreactors at the same time as the finished product is being harvested. This has increased yields and reduced production costs by 30% – even if no further R&D progress is made, the ingredient will now cost the same as commodity beef when produced at scale.

Speaking of which, Better Meat Co. currently operates a 9,000-liter fermenter and plans to use a Department of Defense grant to expand capacity to 150,000 liters, Shapiro told FoodNavigator.

The government funding will be welcome for the startup, which has struggled to raise capital, thanks in large part to an 18-month legal battle with fellow mycelium meat startup Meati. Now that the dispute has been resolved, The Better Meat Co is doubling down on its fundraising efforts, raising another round of investment in the coming months.

DoD Wants to Boost Bioeconomy, But Withdraws from Cultured Meat Project

DBIMP, founded earlier this year, has so far paid out $23 million in grants to 13 startups, with up to $2.5 million in funding aimed at strengthening U.S. biomanufacturing capabilities. Companies can apply for additional funding of up to $100 million, and the DoD plans to invest in more than 30 projects in total.

In this round, The Better Meat Co. joins six other startups that have benefited from state funding: Battelle, Modular Genetics, Genomatica, Industrial Microbes, ZymoChem and Biosphere.

These investments are in response to the Biden-Harris Administration’s 2022 Executive Order to advance the nation’s bioeconomy.

“President Biden has called on the Department of Defense to evaluate how the agency can leverage biotechnology to make our supply chains more resilient, create jobs at home, and strengthen the American economy,” said Heidi Shyu, Under Secretary of Defense for Research and Engineering.

“These major investments will help fulfill his call to harness the full potential and power of biotechnology to advance national and economic security,” she added.

The DoD made significant progress, adding $450 million to the BioMade biomanufacturing consortium’s budget last year. “Expanding the DoD’s biotechnology capabilities is critical to maintaining the U.S. supply chain and military advantage,” Shyu said.

Still, the DoD has withdrawn its request for funding to develop cultured meat for military rations as part of an effort to make the military food system more climate-friendly. The department withdrew its efforts after lobbying from the National Cattlemen’s Beef Association, a livestock advocacy group that has worked with seven members of Congress.