Estonian BioTech start-up ÄIO has successfully raised €1M from investors, including Nordic Foodtech VC and EAS, to create sustainable, full-value alternatives to the environmentally depleting oils currently used in the food industry.
ÄIO grew out of TalTech and was founded in 2022 by two bioengineers, Estonian Petri-Jaan Lahtvee and Brazilian Nemailla Bonturi. Their startup aims to revolutionize the food industry by producing edible fats and oils from agricultural and wood industry side-streams. ÄIO’s international team includes 6 experts – two Brazilians and four Estonians, all possessing experience in bioprocessing, synthetic biology, and food technology.
Better oils for the better world
“As scientists, we were excited that years of research resulted in a real product that could revolutionize the entire food industry and consumer experience. We highly appreciate everyone who has contributed to our success story, and we will continue to develop the company and its products together with our partners, the leading investor, and the food industry. We will also continue to work with TalTech to train the next generation of bioengineers,” says Petri-Jaan Lahtvee.
The development of the food-grade spread from sawdust took six years of hard work and dedication by the researchers and was partly inspired by Estonian scenery. The use of sugars has been the main component of the food industry, but as sugars are not found in large quantities in Estonian nature, ÄIO’s founders turned to use wood and agricultural waste, with sawdust being the most voluminous type of production waste in Estonia.
The current food system is responsible for over a third of greenhouse gas emissions. By creating sustainable alternatives to palm and coconut oils, ÄIO seeks to benefit both the environment and consumers, as these alternatives will also be healthier and have no allergic reactions. According to the team’s calculations, their solution mitigates 160 kT of CO2 per year in comparison to the palm oil industry, which is projected to have a market value of 92 billion euros by 2030. The new investments will be used to increase production capacity, test products with the food industry, and apply for novel food permits to enter the European market.
ÄIO’s entire production process is based on research carried out in Estonia, through which industrial side-streams are transformed into food products through a fermentation process, similar to brewing beer or raising bread with yeast. It relies on the “red bug” microbe created and patented by Nemailla Bonturi, which turns side-streams of agriculture and other industries into tasty and appetizing fats and oils.
Besides food production, ÄIO’s RedOil can also be used in cosmetic products and household chemicals, replacing lubricants and surfactants derived from petroleum or palm oil. The company plans to start production on an industrial scale by 2026.
Estonia’s favourable business environment has created the perfect setting for companies like ÄIO to thrive and benefit from public and private sector collaboration. And for Nordic Foodtech VC, a Helsinki-based venture capital firm backing the future of food, it’s the first-ever investment in the Baltic region.