Biotechnology startup ÄIO has raised €6.1 million through venture capital funds Voima Ventures, 2C Ventures, SmartCap and Nordic Foodtech VC.
The funds will help build a demo plant in Estonia to produce environmentally friendly oils and fats from wood and agricultural residues, offering an alternative to the widely used oils in the food industry.
Founded in 2022 as a spin-off from TalTech (Tallinn University of Technology), ÄIO has developed a unique method that enables the food industry to reduce its reliance on environmentally harmful animal fats, palm oil and other vegetable oils.
ÄIO’s solution uses specialised yeast to transform by-products from wood and agricultural processes, such as sugars extracted from sawdust, into food-grade fats and oils. This process is significantly faster and much less taxing on the environment.
ÄIO Tech OÜ was founded in 2022 by TalTech bioengineers Petri-Jaan Lahtvee (PhD) and Nemailla Bonturi (PhD). Today, ÄIO’s international team, with experience in bioprocessing, synthetic biology, and food technology, consists of 16 people from Estonia, Brazil, Poland, Armenia, and Italy.
The startup has developed three alternative product categories: encapsulated oil, red oil and butter fats. These products can replace widely used palm oil in the food industry, and ÄIO’s branded Red Oil can also be used in cosmetics and household products.
According to Nemailla Bonturi, co-founder of ÄIO, oils made from residues significantly reduce the environmental impact of agriculture and animal farming.
“ÄIO’s oils, produced from industrial residues, help reduce land use by up to 97 per cent and water consumption by as much as ten times compared to current palm oil and animal fat production. Additionally, the speed of oil and fat production through fermentation is ten times faster,” said Bonturi.
According to Nordic Foodtech VC partner Mika Kukkurainen:
“ÄIO’s food industry testing has been successful, and feedback on the initial products has been encouraging. We are confident that with this funding, we will reach the next phase, and we welcome our new co-investors with joy,”
Hendrik Reimand, partner at the venture capital fund 2C Ventures, believes that ÄIO can turn its scientific advancements into commercial success:
“Providing sustainable alternatives to products such as palm oil or animal fats is a critical step in reducing the environmental impact of the food and cosmetics industry. We are confident in the teams’ ability to turn this scientific development into commercial success.”
With the investments, ÄIO plans to build a demo plant in Estonia, where it will start producing tens of tons of encapsulated oil, red oil, and butter fats.
The plant is expected to be completed by 2026. Raw materials will be sourced through collaboration with various Estonian and Finnish food industry companies, whose by-products will be used to produce oils. ÄIO is also working with the Estonian company Fibenol, whose hydrolysates are planned to be valorized.
ÄIO now has over 120 partners from Estonia and abroad, providing them with industrial residues or testing ÄIO’s oils and fats.
“For a scientist, the greatest achievement is when years of research result in a real product that can change the entire food industry and consumer experience. We will continue to develop the company and its products in collaboration with partners, investors and the food industry. We will also continue working with TalTech to train the next generation of bioengineers,” Nemailla Bonturi explained regarding the next steps.
Lead image: ÄIO founders 2024 – Professor Petri-Jaan Lahtvee and Nemailla Bonturi. Photo: uncredited.
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