mycelA South Korean startup making fungus-based biomaterials that can replace leather and meat said it has raised $10 million (13 billion WON) in a pre-Series A round of funding.
Mycel Sungjin Sah, co-founder and CEO, told TechCrunch that the company uses mycelium, a mushroom root-like structure, to make leather substitutes that can be used for car seats and luxury cosmetic products and fashion products such as shoes, clothing and bags. can be done in , Mycel is in talks with global cosmetic brands to develop mycelium-based leather products as well as cosmetics, Sah said, adding that it aims to commercialize its mushroom leather in 2023.
The Seoul-headquartered startup will use this new funding to expand manufacturing of its fungus-based biomaterials in South Korea and open a production plant to double its headcount to 42 employees, Sah said in an interview with TechCrunch. . The company, a spin-off of Hyundai Motor’s in-house startup program, was founded in 2020 by former Hyundai Motor employees Sah, Sungwon Kim (COO) and Yeunggon Park (CSO).
Mycel isn’t the only company that uses mycelium to make leather. There are at least eight companies around the world that use mycelium to make leather, per 2021 Content Innovation Initiative Report, These mycelium-based material innovators have attracted investors to grow leathery derived from mushrooms and plants. A San Francisco-based startup called MycoWorks raised $125 million in a Series C round earlier this year, while Bolt Threads also fetched $253 million At a valuation of 1.15 billion in September 2021. Ecovative Design also closed $60 million in March 2021.
Investors in Mycel’s latest financing round include Korea Development Bank, Industrial Bank of Korea, Hyundai Motor’s Zero 1 Fund, also known as ZER0 1NE 2 Fund, Stone Bridge, We Ventures and Spring Camp. According to Sah, its pre-money valuation is around $40 million (50 billion won).
Next-generation fabrics are projected to reach the global wholesale market to replace leather, silk, down, wool, fur and exotic skins with plant-based, microbe-derived, mycelium, recycled and other sustainable materials. About $2.2 billion by 2026,
A range of fashion brands are exploring the next generation of materials to partner with, As per 2021 MII report, In July, Stella McCartney, a global luxury brand that has been dealing with bolt threads since 2017. Launched a limited run of 100 mushroom-derived leather bags, apart from this, Hermes collaborates with MycoWorks To make a handbag using leather obtained from mushrooms.
Mycel is also competing with fungus-based food developers like Mycorena and Quorn in the alternative protein space.
On top of the leather of the mushroom, the mycelium develops a fungus-based biomaterial that can be used as an alternative protein to disrupt the fleshy area – this biomaterial, which is different from the mycelium of the micelle in the leather, is a fungus But technically not a mushroom, clarified Sah. Back in 2020, the startup tried to move to alternative proteins as its main biomaterial product, which was experiencing a boom in South Korea in early 2020. But the company now develops biomaterials for both mushroom-based leather substitutes and alternative proteins, Sah explained.
Sah said the company aims to enter Singapore with its fungus-based biomaterial, which will be used in alternative proteins, early next year.