Brewing eggs: AB InBev venture arm to help Clara Foods scale up animal-free protein

Clara Foods has been working for years to make animal-free egg whites through precision fermentation. And while the company been able to replicate the proteins, function and taste in the egg, CEO Arturo Elizondo has been running into another problem.

“When it comes to leveraging really deep tech, … you have to truly compete head to head with animal proteins at scale,” Elizondo said. “It’s not enough to have a really tasty product. It’s not enough to be able to make a product that can foam and leaven and bind just like an egg can if you cannot get this accessible to everyone. We knew that scale was going to be what truly unlocked the multibillion-dollar opportunity and [bring] the massive impact on the food industry.”

Through a new partnership, Clara is working with an expert in fermentation to develop that scale. The new partner is somewhat unexpected: global beer brewing giant AB InBev, through its venture and innovation arm ZX Ventures.

ZX Ventures has a mission of growing the food system of the future. Earlier this year, it formally put together its BioBrew division, which applies the fermentation technology and scale mastered by AB InBev to precision fermentation for animal-free protein based foods.

Patrick O’Riordan, CEO of BioBrew, said ZX Ventures has been working to build the BioBrew team and platform for the past couple years. The partnership with Clara Foods is the beginning of its work with fermentation companies to help grow the segment. This is the brewer’s first partnership with a food company, but O’Riordan said it will not be the last.

ZX Ventures works with companies to solve issues they face, and helping to establish more sustainable food production is high on the list of what ZX Ventures wants to do, O’Riordan said. While fermenting proteins is very different from beer, AB InBev has mastered the fermentation process and production at scale — exactly what alternative protein companies like Clara Foods need to be able to do.

“We started to look at this space and we said, ‘Listen, is there opportunity for us to have a meaningful contribution here?’ ” O’Riordan said. “Those of us who are familiar with the technology within ABI and also familiar with the problem in terms of sustainable food production said, ‘Look, yeah — we could really apply some of what we know to help solve this problem.’ “

Through the partnership, the BioBrew team will help Clara develop fermentation technology so it can have output at scales similar to those at AB InBev breweries — about 500,000 to 1 million liters, O’Riordan and Elizondo said. At this scale, Clara’s animal-free egg whites could be at a cost and availability to compete with the more than $200 billion global egg market, Elizondo said.

A partnership years in the making

The first seeds of this agreement were planted back in 2015, when Elizondo was participating in the IndieBio accelerator program. O’Riordan visited the program one day and started talking with Elizondo, whose ambition and vision impressed him.

The two kept in touch through the years, and O’Riordan and Elizondo both said they were at the right stage in their development to start this partnership. Clara is set to start producing its egg white protein ingredients for manufacturers — the first products are set to hit the market later this year, Elizondo said. But Clara needs to be able to scale up in a way that no company in its space has done before, both to lower the product’s cost and to make it a competitive option for any manufacturer, not just those who would choose the ingredient to meet specified dietary or health requirements, he said.

“Ultimately, if we wanted to make animal-free animal protein accessible to everyone globally, we needed a partnership to match the scale of the problems that we have,” Elizondo said. “Talking with Patrick, I knew there was going to be a lot of synergies, not just in terms of compatibility with our businesses back in the day, but that we both had a shared vision of finding ways to curb this climate crisis.”

O’Riordan added that as the world’s largest beer company, AB InBev has centuries of experience at efficient and large-scale fermentation production — but it has also mastered how to make the process work for food. Other industries with experience in large-scale fermenting, like biopharma, often follow guidelines and processes that work for their sector, but might not be applicable to a product that people directly consume, like food and drink. Likewise, the brewing company’s expertise can help ensure the end product is high quality, O’Riordan said.

Many people in the fermented protein business explain the way their products are made by comparing it to the way a brewery produces beer. O’Riordan said that in order for alternative proteins to be truly successful, fermenting them needs to be as commonplace as fermenting beer.

“There are definitely differences in the technology, with huge similarities in terms of the underlying fundamentals and sensibilities just to make it successful,” O’Riordan said.

These differences can be quite large. For example, when fermenting beer, it is important to keep oxygen out of the process, O’Riordan said. When fermenting protein, oxygen is necessary for the process to succeed. But some of the kinds of technologies needed to grow, separate and work with alternative proteins are similar to ones developed by the alcoholic beverage industry, both to mass produce popular beers and to help develop other types of alcoholic beverages.

Moving beyond eggs — and beer

Even before this agreement was made public, Clara Foods has had an eventful 2021.

Last month, Clara unveiled its first ingredient in the business-to-business space: an animal-free pepsin. Elizondo said the pepsin, which will be distributed globally by Ingredion, was a good way for the company to show proof of concept with an important ingredient for manufacturers that could be produced in smaller quantities. As Clara learns how to scale up its production, it will be ready to bring more on the market.

And while Elizondo said some egg protein products are already forthcoming, Clara is doubling down on R&D to improve the product more, developing what he called “Generations 2 and 3” of products. The company is delving into the more than 200 specific protein components in eggs, some of which have never been scrutinized at this level or even named, he said. The goal is for Clara to determine which proteins make eggs more nutritious, taste better or perform more efficiently, and then produce egg ingredients with this “hyperfunctionality,” Elizondo said.

“[These products could] really enable truly Food 2.0, that can pack a bigger punch and really create a future where the most sustainable ingredient is also the most delicious, or the one that has the healthiest nutritional profile or just has a better texture and mouthfeel,” Elizondo said. “That way, it’s truly an uncompromised experience, but where the products really compete in their own right.”

The agreement between Clara Foods and ZX Ventures doesn’t include manufacturing Clara’s proteins at this time, but O’Riordan said that could be a possibility in the future. The dream of BioBrew, he said, is to create a platform that any alternative protein developer could use to make its product on a large scale. 

“That’s where we want to get to, and to bring folks — like Clara, like Arturo — onto the platform, to partner with them and to help them realize their dreams,” O’Riordan said. “Ultimately, our dream is really going back to sustainable food culture, which is critical for us in terms of part of our better world. We think it fits very nicely to that from a broader ABI perspective.”

Source