Futuregrowth bags one of SA’s largest seed funding rounds

In one of the largest seed funding rounds in South Africa’s history, Futuregrowth was the lead investor in Inseco, a start-up company using black soldier flies to convert low-value organic by-products into high-quality protein, oils and fertilizer.

This $5.3-million venture capital investment in the agriculture reflects space is testimony to the company’s diversification into worthy, impact-driven assets, said Amrish Narrandes futuregrowth’s Head of Unlisted Equity Transactions

Inseco is confirmed by the company in a press release. tFuturegrowth Development Equity Fund. This is said to reflect the fund’s strategy of diversification into worthy early-stage assets.

It also aligns with Futuregrowth’s growing focus on investing in innovative and sustainable initiatives across the agricultural value chain, especially when these have a beneficial impact on the planet.

Global expansion plans

By converting waste into food and feed, Inseco’s flagship products, EntoMeal and EntoOil, are described as nutritious and sustainable alternatives to conventional products such as fishmeal and fish oil, with distinct environmental returns.

Inseco, which is based in Cape Town, supplies the local poultry, aquaculture and pet food markets. The company plans to expand its operations into Europe, Africa and the United States. This investment will be used by the company to increase its manufacturing capability and to fund ongoing research to keep it ahead of the game.

“Now, more than ever, we’re seeing the importance of sustainability and the responsibility that we have, to be a more resource-efficient society for future generations,” said Inseco chief executive Simon Hazell.

“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 food demands of the future.”

Narrandes said Futuregrowth’s backing of Inseco fits well within the company’s philosophy of responsible investment.

“In comparison 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 usage and makes zero use of arable lands. In addition to the strong ESG case, insect protein has a superior nutritional content, which results in higher feed conversion rates compared to traditional protein sources.”   

According to several reports, the demand for insect proteins could exceed 10 000 metric tons in 2030. While there are many possible uses for insect proteins, it is believed that the aquafeed and pet food markets will be the most important.

Inseco has the opportunity to service a huge market, with the global pet foods market being valued at $38billion.

Insect protein sales are expected to grow to $4.6 billion in 2027. This market will see increased greenhouse-gas emission reductions and a greater awareness of the importance to use sustainable food sources to reduce food security.

While human consumption of insects is not widely accepted in the West, more than two billion people worldwide currently eat them as part of their daily diet.

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