Israeli food tech startup Remilk, a developer of animal-free milk and dairy, raised $120 million in a funding round led by Hanaco Ventures, a New York- and Tel Aviv-based venture capital fund.
Additional investors included US food tech VC firm Rage Capital, CPT Capital, a backer of Impossible Foods, plant-based egg company Just, and Israeli plant-based yogurt startup Yofix, and NY investment firm Precision Capital. Existing investors such as Israeli food giant Tnuva, German dairy company Hochland, early-stage investor fresh.fund, and Israeli VC company OurCrowd also participated in the round.
Hanaco Ventures has backed Israeli tree intel company SeeTree, plant-based meat company Redefine Meat, shared transportation company Via, and Lightricks, a Jerusalem-based software startup that makes photo and video editing apps.
The Remilk investment revealed Tuesday was the single largest in a cow-free dairy company to date, and values the startup at an astonishing $500 million, according to sources familiar with the deal. Financial daily The Marker reported a valuation of $325 million.
Remilk, founded in 2019, produces milk proteins via a fermentation process that renders them “chemically identical” to those present in cow-produced milk and dairy products.
“The end result is 100 percent similar to ‘real’ milk,” but free of lactose, cholesterol, growth hormones, and antibiotics, founder Aviv Wolff, who set up Remilk with his scientist partner Ori Cohavi, previously told The Times of Israel.
The two entrepreneurs mapped out the chemical composition of milk, assessed the fat, lactose and sugar in the liquid, and determined that the key ingredient to making milk is the proteins.
Remilk recreates the milk proteins by taking the genes that encode them and inserting them into a single-cell microbe, which they manipulated genetically to express the protein “in an efficient and scalable way,” said Wolf. The product is then dried into a powder.
“We’re making dairy products that are identical to cow-milk products, with the same taste, texture, stretchiness, meltiness, with no cholesterol and no lactose,” Wolff said. “We’ve basically ported the whole mechanism of producing milk into a single-cell microbe. We don’t need the ‘rest of the cow,’ and we surely don’t need to spend resources in the process of creating a 900-kilogram animal.”
In a briefing to reporters on a press tour in November, Wolff said, “relying on animals to make our food is no longer sustainable. The implications of animal farming are devastating for our planet.”
Remilk’s model of food production will be up to 100 times more land efficient than the existing dairy system, 25 times more feedstock efficient, 20 times more time efficient, and 10 times more water efficient, he said.
When mixed with water, plant-based oils like coconut oil or sunflower oil, and plant-based sugar, the milk liquid and its derivatives can be produced with exactly the same properties, taste and structure, Wolff explained.
The dried powder can be sold to dairy companies, and food manufacturers can add water and fat to create a range of cheeses, yogurts, and ice creams. Remilk can also offer ready-made products like hard cheese, yogurt, and cream cheese.
Wolff said in November that the startup set up production facilities in Europe and the United States, where it is already working with leading food companies, and was now collaborating with regulators and rabbinic authorities to get its product cleared and certified.
Remilk currently employs 75 people at its headquarters in Rehovot.
Wolff is a former combat commander in a special forces unit of the IDF. After eight years of military service, he worked in several startups until he set up Remilk. His partner Cohavi has a PhD in protein biochemistry from the Weizmann Institute of Science and formerly led research and development activities in biotech firms.
Remilk operates in the dairy alternatives market, which is expected to grow from $22.25 billion in 2021 to $53.97 billion in 2028, according to research firm Fortune Business Insights. It is separate from the plant-based milk sector, where beverages are made from soy, almond, coconut, oats, hemp, and other non-animal material.
Remilk previously raised funds with Israeli dairy company Tara and beverage company Tempo, among other investors.
Another Israeli cow-free dairy startup, Imagindairy, raised $13 million in seed funding in November. Imagindairy says its technology recreates nature-identical, animal-free versions of whey and casein proteins that can be used to produce dairy duplicates.
Meanwhile, Israeli cultured dairy company BioMilk went public on the Tel Aviv Stock Exchange last April. BioMilk isolates the milk-producing cells from cows’ udders and transfers them to a bioreactor, where they are exposed to materials patented by the firm to produce milk, but without needing a cow in the final milk-producing process. The Central Bottling Company, also known as Coca-Cola Israel, has invested in the company.
Note: This article was edited to correct an error that named Tnuva as the lead investor. Hanaco Ventures led the round.
Shoshanna Solomon contributed to this report