Mycelium-Based Products Highlight Innovation in Chinese Alt Proteins

China is home to a growing number of consumers looking to adopt a healthier and more sustainable lifestyle, including many who want to reduce their meat intake and replace it with alternative proteins. Still, compared to the United States, China cares far less about plant-based diets as an act of environmental stewardship — so alt protein brands have to consider other areas of importance.

“Health is the key,” says Eve Samyuktha, CEO of 70/30 Food Tech, a Shanghai-based alternative protein startup, and Dao Foods portfolio company, that sells full ready-meal products to busy, urban white collar workers. The success of its pilot program during which they sold 25,000+ meals to over 1,300 customers, was based mainly on a functional food value proposition, clearly stating the macronutrients on the package. Some consumers didn’t even know it was plant-based. The team looked for plant based alternative meat options to add to the meals, but none could meet their strictest of health requirements. They saw a need in China for a meal replacement that mimics meat but is also minimally processed, so they made one using mycelium.

Mycelium is the branching, root-like structure of a fungus, which transforms well into products resembling muscle fibers. That’s why they’re using it to resemble shredded chicken — both in texture and nutrition.

70/30 is preparing to release its ready-meal products using mycelium fermented protein, following the close of its upcoming Series A round and will increase production capacity with their manufacturing partner, Shanghai Qingmei Green Food Group, an industry giant in China that has a massive network of cold chain logistics at their new facility in Shanghai. Through this partnership, 70/30 will scale-up production and reach nationwide distribution of its healthy and tasty meal plans in 2023.

For Dao Foods, this has meant promoting plant-based alternatives to culturally significant foods that Chinese consumers have shown interest in. This may mean reducing the cost of these foods or simply making them more tasty and appealing than their conventional counterparts. The bottom line goal is to develop and invest in brands that will make healthier and safer foods more affordable and accessible to China.

And while the consumer base may be different, there’s no shortage of potential for alt proteins in China. Many companies are poised to make a big splash with consumers but are first taking a cautious approach as they determine the best ways to do so.