CAPE TOWN, SOUTH AFRICA – On April 21, Inseco announced that its seed funding round closed at $5.3 million. Futuregrowth Asset Management led the company’s seed funding round, which also received participation from E4EAfrica and Oak Drive Ventures.
Inseco uses black soldier fly larvae (BSFL) to transform organic by-products into high-quality proteins, oils and fertilizers. The company’s flagship products include EntoMeal, an easily digestible protein meal, and EntoOil, a natural oil extracted from EntoMeal. EntoMeal and EntoOil can serve as sustainable alternatives to fishmeal and fish oil in pet food formulations.
Founded in 2017, the company is committed to using insects to solve global sustainability issues.
“Now, more than ever, we see the importance of sustainability – and our responsibility to be a more resource-efficient society for future generations,” said Simon Hazell, CEO and co- founder of Inseco. “At Inseco, we believe that insects will play an important role in this transition, becoming a widely available source of sustainable protein and an important form of nutrition to help meet the dietary needs of the future.”
Currently, Inseco serves the pet food and aquaculture industries in Cape Town, but plans to expand to other parts of Africa, as well as Europe and the United States. According to Futuregrowth, its investment will allow Inseco to expand its manufacturing capacity and fund its R&D.
“Inseco is a market leader in this area,” said Ayanda Bolani, analyst at Futuregrowth. “After years of research and development, the ingenious management team has developed advanced and state-of-the-art processing capabilities, which puts it well ahead of its competitors. It is currently the largest insect protein producer in the southern hemisphere and the only company in South Africa capable of producing defatted insect meal and oil, a product in high demand worldwide.
According to Inseco, insect protein uses 7,000% less land than soybean meal, emits 47 times less greenhouse gases than windrow composting, can reduce livestock feed costs by 25% and have a lower production cost than fishmeal. These sustainability benefits are what prompted Futuregrowth to invest in Inseco.
“Investing in Inseco fits well with our responsible investment philosophy,” said Amrish Narrandes, head of unlisted equities at Futuregrowth. “Compared to traditional protein sources, insect protein has an inherently lower environmental impact, as the process directly reduces food waste, involves minimal greenhouse gas emissions, limited water use and uses no topsoil.In addition to the strong ESG case, insect protein has superior nutritional content, resulting in higher feed conversion rates compared to traditional protein sources.
In 2019, Inseco participated in the Technology Innovation Agency Global Cleantech Innovation Program, which supports and recognizes cleantech startups. As part of the program, Inseco won an award in the Cleantech category, as well as the Best Youth-Led Team award.
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