Exclusive: AAK backs carbon-to-fats startup Savor
Savor's butter shown on a cinnamon roll. Photo courtesy of Savor
Swedish specialty plant-based oil-and-fats maker AAK is collaborating with and investing in U.S. startup Savor, Savor CEO Kathleen Alexander tells Axios Pro exclusively.
The big picture: Funding for food tech has slowed in recent years due to inflation boosting costs, difficulties with exits and a correction from the height of 2021.
Zoom in: The partnership is a two-year collaboration agreement to jointly develop and commercialize fats and oils for alternative dairy and baked goods.
- Savor plans to use the proceeds of the strategic round to build out its facility in Batavia, Illinois, just outside of Chicago, from a couple of tons per year to a couple hundred tons of product per year.
- AAK also joined a $32 million strategic round that Savor closed earlier this year, says Alexander. The company decided to push back a planned Series B to a later date.
What we're watching: Savor plans to eventually raise financing for a larger commercial facility that would be able to make closer to 10,000 tons per year.
How it works: Savor, founded in 2022, has developed a thermochemical process that uses a catalyst to turn carbon dioxide and hydrogen into the fat molecules that make up products like dairy butter, milk fats and vegetable oils.
- The company can fine-tune its fats and oils to cater to its customers needs and create ingredients for restaurants and food businesses. It's also developing oils for cosmetics.
- The process of producing the fats and oils is more efficient and sustainable than growing crops or taking it from animals, and it also enables a company to have more control over its ingredient supply chain.
Catch up quick: Savor raised a $23 million Series A in 2023 led by Synthesis Capital and joined by existing investor Breakthrough Energy Ventures.
- BEV led the firm's seed round and BEV's Chris Rivest is on Savor's board.
- Last year, Savor launched its first product, an animal-free butter, which is being used by restaurant SingleThread in Healdsburg, California, and San Francisco bakery Jane the Bakery.
What's next: Savor and AAK plan to develop products together this year and bring them to market.
