FREDERICTON – A New Brunswick company that makes a mushroom-based natural preservative for food and beverages received $2-million in seed funding from major food-tech investors.
Chinova Bioworks has secured investments from DSM Venturing BV, an arm of Dutch multinational science firm Royal DSM, and Rhapsody Venture Partners, a science and engineering investor in Cambridge, Mass.
AgFunder, a venture capital investment platform with more than 50,000 members and subscribers globally, and Natural Products Canada, a public-private-backed non-profit organization that aims to make Canada the Silicon Valley of natural products, also contributed to the round.
“In just two years, Chinova has developed a unique and innovative preservation technology using mushroom-based chitosan that can be customized to fit the needs of food and beverage producers’ individual microbial issues,” said Chinova Bioworks CEO Natasha Dhayagude in a press release. “Our product fits the standards of the clean label that consumers want and that producers need.”
Chinova’s preservative, based on an ingredient called chitosan that’s extracted from mushrooms, allows food and beverages to be protected from microorganisms including bacteria, yeast and mold. The company says its preservative is also easy to use and doesn’t affect the taste, colour, odour or feel of the food or drink.
“Consumers are demanding natural ingredients in their foods and beverages,” said Dhayagude. “Chinova provides the first entirely natural preservative that is both highly effective and broad-spectrum. We are fortunate to already have customers ready to launch and a large and rapidly expanding sales pipeline. With our product now validated with leading food companies, we will use this investment to quickly scale our production to meet demand.”
This seed investment will allow Chinova to build its team, including to hire a senior process control engineer. It also plans to use the funding to scale up production and manufacturing, and speed up the commercialization of its product.
“Chinova has been working with small to medium-sized food and beverage producers as well as many multinationals in the industry,” said Dhayagude in a release published by AgFunder. “These clients are really looking for customized preservative solutions that have no organoleptic impact on their food and beverage products which is what Chinova offers.”
The company’s ability to develop an effective and totally natural product made it attractive for investment, saysAgFunder CIO Michael Dean.
“Chinova is one of a new breed of companies such as MycoWorks, Terramino Foods, and MycoTechnology that are unlocking the enormous potential of mycelium,” he said in a release. “While the food and beverage industries are Chinova’s initial focus, their proprietary technology to fractionate chitosan molecules to produce a customized, highly effective and natural anti-microbial product provides them with numerous multi-sector applications, which is incredibly exciting.”
Founded in 2016 by Dhayagude and COO David Brown, the company had also received a pre-seed investment from the New Brunswick Innovation Foundation, SOSV, and the First Angel Network.