Australian hyper-fermentation company, Cauldron, has closed a $9.5 million Series A round, led by Horizons Ventures, with SOSV and In-Q-Tel (IQT) joining existing investor, Main Sequence. In 2023, it completed an over-subscribed seed funding round, raising $10.5 million.
Cauldron CEO and co-founder, Michele Stansfield, said, “Cauldron has proven its precision fermentation at an industrially relevant scale, unlocking a significant decrease – between 30 and 50 per cent – in the cost of goods for our customers versus traditional batch fermentation.
“From biofuels and agriculture to cosmetics and chemicals, the opportunities are immense, and with the support of our incredible investors, we’re poised to capitalise on them.”
Cauldron said its continuous fermentation, or “hyper-fermentation” technology includes a novel bioreactor design and proprietary growth medium formulation to improve the economics of large-scale fermentation production by five times compared to current industry standard. This allows more sustainable bio-based products to reach price parity and achieve mainstream adoption.
Chris Liu from Horizons Ventures said precision fermentation was “an amazing technology” because it enables bio-based production of a wide range of products with diverse applications.
“To date, the technology has been hamstrung by its costs compared to conventional production methods, but Cauldron’s unique solution significantly improves the competitiveness of precision fermentation both in capital and operating expenditure,” Liu said.
In February, the company was granted a first-of-its-kind regulatory approval by the Office of Gene Technology Regulator (OGTR) to run production trials of animal protein ingredients in batches up to 10,000 litres. The DIR200 licence allows Cauldron to use its proprietary precision fermentation technology and Pichia Pastoris yeast, to produce dairy, egg, and spider-silk proteins.
“This licence significantly de-risks Australian-based precision fermentation technologies and Cauldron’s proprietary hyper-fermentation technology, giving Cauldron the confidence to rapidly erect fermentation facilities that achieve significantly lower cost of goods at a fraction of the capital expenditure,” Stansfield said.
Cauldron has successfully run a 10,000-litre production system continuously for more than eight months without contamination or “genetic drift” of the microbes, two of the biggest challenges in running long-term fermentation.
Stansfield said that because Cauldron’s system operates continuously, it can outproduce traditional batch systems five times larger with its smaller, far less costly bioreactors.
General partner at SOSV and IndieBio MD, Po Bronson, said, “Michele and Cauldron’s history of succeeding at long-run fermentation is unparalleled. The benefits of the technology – the ability to continuously produce, up to 50 per cent lower net unit costs, and 20 per cent more output with 45 per cent less capex – dismantle a major obstacle for the industry and position the company as a critical manufacturing partner for companies building a more sustainable future.”
Stansfield helped develop Cauldron’s technology as the general manager at Agritechnology, which spent 35 years researching and developing continuous fermentation systems for the agricultural market in Australia. Cauldron acquired Agritechnology’s precision fermentation IP through its seed round in 2023 in order to commercialise and scale the technology globally.
With five companies working on precision fermentation food in Australia – four producing dairy proteins and one producing fats – CEO of alternative proteins think tank Food Frontier, Dr Simon Eassom, said this was an important development for one of Australia’s newest food industries.
“This development is not a new project or R&D experiment; it is a pathway to market success for Australia’s precision fermentation food companies who have needed access to larger facilities.
“This not only opens the door for Australian food ingredient manufacturers, but also opens the door for Australia to exploit brand new industry growth and become a world-leader in the precision fermentation field,” Eassom said.
