Khong Guan investment in SGProtein is part of S$4m seed round for foodtech startup

SGProtein, a Singapore-based startup which manufactures plant-based meat, has raised S$4 million in a seed round led by biscuit maker Khong Guan, in the latest instance of a traditional food-and-beverage company getting on the foodtech bandwagon.

Khong Guan had signed a shareholders' agreement effective Monday with SGProtein's founders and investors to invest in a 30 per cent stake in the company for S$1.5 million in cash.

Commonwealth Capital, which also has stakes in home-grown brands like The Soup Spoon, Udders and Pastamania, is among other strategic investors that joined the round, Riccarda Züllig, co-founder of SGProtein, told The Business Times.

The company hopes to tap the "profound experience in food manufacturing and distribution" of its investors and board of directors to become a large-scale manufacturer for plant-based food products.

Khong Guan's know-how in operating food manufacturing at scale at high food safety and quality standards is of tremendous value to us, said Ms Züllig. "SGProtein will also be able to leverage Khong Guan's export network to scale its business."

The fresh funds will go into building the startup's high-moisture extruder, which enables the production of plant-based products with a meat-like texture at high capacity, said Ms Züllig. Funds will also be used to set up a fully-automated production facility, and to provide working capital for the company.

A NEWSLETTER FOR YOU

Monday, 3.30 pm

Garage

The hottest news on all things startup and tech to kickstart your week.

Sign Up

To manufacture plant-based meat, ingredients like protein isolate, water, oil, fibre and natural flavour are fed into the extruder, which uses heat, shear forces and an elaborate cooling die to produce the textured "meat" alternative.

The extruder can be compared with a large-scale cooking device as it uses heat and pressure, said Ms Züllig. She added that the combination of ingredients and processing can produce products with different texture, bite, juiciness and taste.

SGProtein will manufacture food products from recipes provided by its clients; it will also collaborate with them on research and development, for example, to create products to suit local market tastes and cooking styles.

The main challenge for any company looking to produce plant-based meat products using this technology is the scaling of the production to an industrial size, said Ms Züllig. This often comes with high cost and the need for specific know-how, she added.

With its new plant - to ready by the fourth quarter - SGProtein can have an initial production capacity of over 3,000 tons, it said. The plant will be housed at its investor Commonwealth Capital's Food Hub in Jurong.

Andrew Kwan, group managing director of Commonwealth Capital, said: "SGProtein will be an enabler for offering consumers sustainable, healthy and of course, very tasty plant-based food safely and proudly made in Singapore."

READ MORE: 

• Khong Guan buys 30% stake in plant-based meat alternatives maker

• Commonwealth Capital launches S$70m integrated food facility