Mycel, a South Korean startup developing fungus-based biomaterials that can replace skin and meat, has raised $10 million (13 billion WON) in a pre-series one round of funding.
Sungjin Sah, co-founder and CEO of Mycel, told TechCrunch that the company uses the mushroom root-like skin substitutes Mycelium to make in car seats and luxury cosmetics and fashion products such as shoes, clothing and bags. . Mycel is in talks with international cosmetics brands to develop mycelium-based skin products as well as cosmetics, and aims to market the mushroom skin by 2023, he said.
The Seoul-headquartered startup will use this new funding to open a manufacturing plant in South Korea to produce fungus-based biomaterials and double its workforce to 42, Saah said in an interview with TechCrunch. From Hyundai Motor’s domestic launch program in 2010 It was founded in 2020 by former Hyundai Motor employees Sah, Sungwon Kim (COO) and Yunggeon Park (CSO).
Mycel isn’t the only company using mycelium to make skin. According to the 2021 Materials Innovation Initiative report, there are at least eight companies around the world developing mycelium leather. These mycelium-based materials have led investors to grow mushroom and plant-derived leather. MyCoWorks, a San Francisco-based startup, raised $125 million in Series C earlier this year, while BoltCrowds raised $253 million for a September 2021 valuation of $1.15 billion. Ecovative Design closed on $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, as well as ZER0 1NE 2 Fund, Stone Bridge, We Ventures, and Spring Camp. Sah said the pre-money estimate is about $40 million (50 billion WON).
The global wholesale market for next-generation fabrics that replace leather, silk, down, wool, fur, and exotic hides with plant-derived, microbe-derived, mycelium, recycled, and other sustainable materials is expected to reach approximately $2.2 billion by 2026.
Various fashion brands are looking to partner with next-gen materials, according to the 2021 MII report. In the year Global luxury brand Stella McCartney, who has been working with Bolt Threads since 2017, has launched a limited run of 100 mushroom-derived leather bags. Additionally, Hermes has partnered with MycoWorks to create a handbag using mushroom-derived leather.
Mycel is also competing in the alternative protein space with fungus-based food producers such as Mycorena and Quorn.
On the skin of the mushroom, the mycelium produces a fungus-based biomaterial that can be used as an alternative protein to disrupt the meat sector — this biomaterial, which differs from the mycelium’s mycelium in the skin, is a fungus, but not technically a mushroom, Sah explained. In the year In 2020, the startup tried to switch its main biomass product for an alternative protein, which is seeing high growth in South Korea in early 2020. But the company now develops biomaterials for both mushroom-based skin substitutes and alternative proteins, Sah said.
Sah pointed out that the company aims to enter Singapore early next year with fungi-based biomaterials used in alternative proteins.