Israeli startup raises funds for farmed scallops

A Jerusalem-based agri-food start-up has entered the scallop market, a cutting-edge segment of the nearly $100 million global seafood industry, with agricultural technology cells to produce cell-grown scallops.

Mermade Seafoods was founded in 2021 by Daniel Einhorn, CEO, Dr. Rotem Kadir, CTO, Embryologist and Microbiologist, and Dr. Tomer Halevy, COO and Biologist with experience in stem cell derivation and culture.

On Monday, the company announced that it had raised $3.3 million from investors OurCrowd, American venture capital fund Fall Line Capital and Dutch investor Sake Bosch, among others.

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She guarantees that her work “will allow the world market for scallops to be rationalized and to offer a tasty and high quality product at prices well below the current market”.

Fresh scallops are among the most expensive dishes in high-end restaurants and can cost anywhere from $30 to $80 a pound at fish stores across the United States. The scallop harvest is irregular and most of the production comes from aquaculture (fish farming) due to increased demand and a still limited supply.

Cultured meat products are already in the process of commercial development, while cultured fish and seafood technologies are still in their infancy.

Mermade says he has developed a new method that uses microalgae to grow the cells needed to make cultured scallops, with a “circular production method” that will make production and the end result both economical and nutritional.

It’s a new approach to aquaponics – a combination of fish and plant production – that the company calls “cytoponics”, and for which it has several patents pending.

Mermade co-founders from left to right: Dr. Tomer Halevy, Daniel Einhor and Dr. Rotem Kadir. (Ofir Harel)

This method involves recycling the biowaste produced by the cell culture products to feed the algae, which are then used as a growth medium – a mixture of nutrients and other substances that support the growth of microorganisms – to nourish the cells.

It is not limited to seafood and could have many applications, including pharmaceuticals, the company says.

“We decided to initially focus on scallops as it is a popular dish around the world but is facing high prices and shortages due to serious supply chain issues,” Einhorn said in a company statement.

“They are easier to produce than other complex meat products and we believe we can bring them to market quickly. »

Einhorn added that the annual global scallop market is worth $8 billion, with more than $600 million in the United States alone. “Our production method will reduce the cost of each scallop dish and increase market volume. Supply will finally adapt to high demand,” he explained.

The company will use the funds to hire more stem cell and algae researchers. It hopes to reach laboratory-scale production by 2023.

Mermade-branded scallops, Einhorn added, will be available for years to come “at an affordable price and with the same quality and flavor as the original scallops.”

Using this new method, Mermade will be able to grow other seafood products such as squid, shrimp and crabs, he said.

Eric O’Brien, co-founder and managing director of Fall Line Capital, said that Mermade “not only pioneer new technologies to improve aquaculture sustainability, but we believe they are laying the groundwork for a form of circular technology that can unlock scalable business solutions”. production for the entire cultured meat industry.”

OurCrowd founder and CEO Jon Medved added that the Jerusalem-based company was “undoubtedly a pioneer in cellular aquaculture and, in particular, scallops”, demonstrating “remarkable progress” in R&D. Mermade has set out to transform a vast market worth billions.

Mermade is one of around 120 companies worldwide that specialize in the alternative seafood industry, including plant-based and cultivated products.

These still represent a small part of the global alternative protein industry, but the market is growing. Companies developing alternative fish and seafood grew by 30% between 2017 and 2020, according to market research firm IMARC Group.

In 2021, at least nine new farmed and alternative seafood companies were founded, most of them in Israel, according to an April report by the Good Food Institute. Mermade is one of them, alongside Wanda Fish, Forsea Foods, Sea2Cell and E-FISHient Protein.

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