The oil substitute technology developer is looking to disrupt vegetable oil supply chains with backing from Virgin Group.

US-based sustainable oil producer Zero Acre Farms secured $37m yesterday in a series A round featuring conglomerate Virgin Group as it works toward replacing destructive oil supply chains. Lowercarbon Capital and Fifty Years co-led the round, which included S2G Ventures, Collaborative Fund, Footprint Coalition Ventures, private investor Dan Barber and undisclosed other participants. Founded in 2020, Zero Acre Farms is using a fermentation process to produce oils and fats as substitutes for vegetable oils like palm, sunflower, canola and soybean oil. Through fermentation, the company hopes to disrupt a vegetable oil market it claims is harmful to the environment and an important driver of health problems from its consumption, as it is virtually ubiquitous in products from packaged foods to restaurant meals and takeaways, becoming increasingly difficult to avoid. Jeff Nobbs, co-founder and chief executive of Zero Acre, said: “Fermentation is the original culinary art, after fire. “We use this ancient technique to produce oils and fats with significantly lower levels of the bad fats that have been linked to inflammation and disease while having a fraction of the environmental footprint. We are proud to be the first company stepping up with the mission to completely remove industrial ‘vegetable’ oils from our food system.” Zero Acre is not alone in its efforts to bring fermentation to the fore. C16 Biosciences, a US-based developer of biomanufacturing technology intended to produce palm oil using metabolic engineering and fermentation, raised $20m in an early 2020 series A round. The potential of fermentation is not limited to food products. Companies like Locus Bio-Energy Solutions are using fermentation and biotechnology to replace or supplement petroleum-based oil products such as degreasers, cleansers, lubricants, coolants, foaming and defoaming agents. Similarly, Xylome Corporation has been producing palm oil substitutes for use in a range of food, cosmetic and industrial settings by using metabolic techniques with yeast. It has not disclosed any external funding to date but is seeking strategic partners or equity investors. Universities have been getting in on the action, too, Technical University of Munich having spun out a company called Global Sustainable Transformation in 2020 to use yeast to produce oil. Researchers at University of Bath demonstrated the potential for yeast to produce oil nearly identical to palm oil over six years ago. The economic potential for the technology could also be lucrative, particularly in markets like Europe where there have been proposals for levies on palm oil imports, and where mandates may eventually require a percentage…

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Fernando Moncada Rivera

Fernando Moncada Rivera is a reporter at Global Corporate Venturing and also host of the CVC Unplugged podcast.