Perfect Day launches biotech-as-a-service business

Dive Brief:

• Precision fermentation leader Perfect Day is launching an enterprise biology business, called nth Bio, that will essentially help companies getting into the space with tech and scale up services. It will be based out of the company’s Salt Lake City hub.
• Finnish egg white protein maker Onego Bio is the first company that will work with nth Bio. Onego uses precision fermentation to make ovalbumin, the most abundant protein in that part of an egg. The company plans to enter the U.S. market first as a bakery and confectionery ingredient and protein supplement, and eventually produce branded baking products for consumers.
• Perfect Day, which makes animal-free whey protein, was one of the first food companies to use fermentation technology to produce proteins that naturally are found in another source. It’s raised $711.5 million in its lifetime, according to Crunchbase, and has a wide array of consumer products on the market using its proteins.

Dive Insight:

When Perfect Day got started, co-founders Ryan Pandya and Perumal Gandhi were essentially trying to make a kinder and animal-free version of real dairy, Ravi Jhala, the company’s global head of commercial, said in an interview. And they did that, raising millions of dollars, forging key partnerships and creating products. Perfect Day even created an affiliated CPG company, The Urgent Company, to make branded products with Perfect Day’s animal-free dairy as a central ingredient.

While the science of precision fermentation is not new, for years it was mainly used in the pharmaceutical and medical tech industries, and had extremely limited use in food until Perfect Day got started.

Today, precision fermentation is a space that is ripe for growth and its science is attracting many new startups. According to the Good Food Institute, there were 39 companies worldwide dedicated to precision fermentation for food at the end of 2021, making up 44% of all of fermentation-driven alternative protein companies. Nine of the 15 fermentation companies that started in 2021 use precision fermentation.

Through good science and business decisions, luck of timing and key early partnerships, including with ADM, Perfect Day is currently the only branded company using precision fermentation for consumer products. Perfect Day realized, according to Jhala, that while it is growing, the company could also do more to help others get into the space. Finding the kind of equipment and facilities needed for creating precision fermented food ingredients — which are subject to a battery of food safety requirements from FDA — at a meaningful scale is challenging and expensive. There also aren’t many companies with knowledge about how to do it.

“Perfect Day is out here to help companies in the precision fermentation space to truly close the gap from strain to scale,” Jhala said. “That’s really what we are trying to achieve. And we want companies to know that there is a path forward, that you do not have to piecemeal your needs. Basically, you can go from soup to nuts essentially with this kind of a service that we are going to offer.”

Perfect Day’s 58,000 square-foot state-of-the-art Salt Lake City facility that nth Bio will operate out should be completely operational by next August, Jhala said.

Onego Bio is a spin-off from VTT Technical Research Centre of Finland, and it has been developing precision fermentation technology for the past several years. It’s raised 14.5 million euros ($14.5 million), with its latest funding grant from Business Finland earlier this month. Onego Bio and Perfect Day say the new partnership is speeding up its go-to-market time, but gave no details of the proposed timeline.