Making the food industry more sustainable, an interview with Anne-Cathrine Lutz, the Co-Founder & VP of Mushlabs

Mushlabs is a biotech company using fermentation to create the next generation of sustainable foods from the roots of mushrooms.

Interview by PM in SET Leaner Diana Dalkevych

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‍First time I got to know Mushlabs was when my peer mentioned the company during our virtual catch-up. Right after the call, I went to check out the product and I loved the website. It left a feeling of something familiar and friendly, but also innovative and new. And that’s what the product is about. Everyone likes to eat tasty cozy food but then it needs to be healthy and nutritious. Mushlabs deals with all aspects. By using mushrooms’ mycelium, they’re producing proteins that are all of that in one flacon. I talked with Cathy, the Co-Founder and VP of Product at Mushlabs, to get to know how the company is doing that and what she thinks about the state of the food system.

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Diana:

Cathy, can we start with you introducing yourself and your work?

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Cathy:

Sure. I'm Cathy Hutz. I'm one of the three co-founders of Mushlabs, and my background is in food science and innovation. But even before that, I focused on the psychological and sociological sides of food consumption. And then, I really fell in love with the world of fermentation because of the diversity that you can create with microbiomes and all of the things you can do with bacteria, and then more complex with mushrooms. That’s when I understood that fermentation held a big potential for alternatives to meat consumption.

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Cathy:

And then, it turned out that fermentation would help to create a certain aroma complexity, flavor profile, and nutrients, which led me to further study it. I was working in the fine dining industry in Copenhagen because fermentation is a big topic there, and restaurants use fermentation to get to this aroma complexity. Especially at Noma, the latest restaurant where I worked. If you source products only locally in Denmark, you’d be very limited, and you’d want to get more aroma diversity. That’s where fermentation comes in. They use fermented products as a base of their full menu and for creating taste diversity they wouldn’t reach otherwise.

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Cathy:

Another interesting thing is that historically fermentation was one of the major techniques to preserve food and nutrients over the winter. When I realized that, I focused much on supporting small companies in the shifting process and the process of supporting their business cases, which implied such questions as how to adjust the fermentation process, how to improve it, and how to make it a bit more efficient. I was also writing a book about fermentation that happens on the edge between chefs and very skilled people who work in the kitchen and in science. The reason is that I think this is an overlapping area that is super underdeveloped, especially in Germany. And we have very little knowledge of how to make use of what chefs are doing in the kitchen. Furthermore, this allows us to use food much more sustainably and reduce food waste back in the day.

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Cathy:

On the other hand, it’s important to less overthink and rather get your hands dirty and apply what people learn at universities. The fermentation field is very interesting to me. And this is also something that I'm doing now, day to day, at Mushlabs, because of the product development department that I'm running at the company. I'm supporting different mindsets by bringing people together from various backgrounds and getting them to create something very new and very different together.

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Cathy:

‍Most people know lactic acid bacteria when it comes to fermentation. However, the moment you start tapping into this world of fermentation, you also get to know the very big players in the fermentation field. And these are mushrooms since they are able to create such a huge diversity of enzymes and other byproducts of fermentation processes. So, what they basically can offer you is a much more complex aroma. And also, from the nutrient-scoring perspective, they are able to produce a super big palate of different vitamins and minerals. And it’s especially exciting when you look into the nature of these mechanisms since the mushrooms are the organisms in nature that take what other kingdoms leave behind and use that for creating new products out of it. Therefore, it's a circle that happens in nature that we, in Mushlabs, try to imitate.

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Diana:

That’s super interesting to me. Especially what you mentioned about how chefs and scientists work with fermentation, it feels as if we need a bridge between those two, which, of course, requires more knowledge on each side. Speaking of which, I’ve got a question for you before we go further into the details of Mushlabs. Currently, there are two main approaches to the development of alternative proteins: cell cultivation and fermentation. My question is what is the difference?

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Cathy:

Both approaches target the reduction of meat consumption. The major difference is that in cell cultivation you actually use cells of animals. Therefore, your basic resource comes from the animal kingdom. Even though you don’t grow full animals, of course. Overall, it's much more sustainable and much more efficient than farming animals. Nevertheless, it's very complex to grow animal-based cells in a lab since the cell environment isn’t fully understood yet. Therefore, you still have a lot of costs to produce these cell cultures and it is very hard to scale this process. And this is the major challenge of this industry, to find the right solution for scaling cell cultivation processes.

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Cathy:

Fermentation with mushrooms is a different field but there are also various approaches inside the niche. What we, for example, are doing is growing the full organism. That is comparable to the mushroom organism that would in nature grow under the soil. We take this mycelium to create products out of it. The vitamin- and mineral-rich mycelium is the major building block of our final product, including the complete amino acid profile and the fiber. And we keep all of that intact because we see that the way how the mycelium grows brings already so many opportunities for final product application. This also allows us, in the second place, to really reduce the number of processing steps that you need.

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Cathy:

For example, when you look into the plant-based proteins that we are using at the moment for most of our meat alternatives, we need high processing techniques such as extrusion, which go through a high pressure to create these textures that remind us of meat. And this is something we avoid because we rather look into the fermentation process and how to solve these things through fermentation instead of later processing.

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Diana:

Thank you for explaining that, Cathy! I suppose Mushlabs is working on something that would be appropriate for a vegan diet. And my question is what exactly would be the end product of your work?

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Cathy:

I cannot fully explain the details because we're not on the market yet. We need to get regulation approval from the European Union to sell our products first. But even for that, we know that we're only using edible mushroom strains. Therefore, we are very confident that this won't take very long since there are no major road blockers. But coming to the product, we're really focusing on becoming a meat alternative. And I clearly want to differentiate between meat replacements and alternatives because we don't plan to replace meat, we rather plan to create alternative offers to the daily – often unconscious - consumed meat-based products.

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Cathy:

For example, vegetarians sometimes eat halloumi cheese or comparable protein-based products in these cases. What we create is a product that is full of nutrients. To summarize what I’ve said, we have a good source of complete protein and we have fiber, which is still a bit underestimated in Europe. And then, of course, other minerals that come with the mycelium system as well.

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Diana:

I should admit it sounds very intriguing since I’m vegan and always looking into ways to bring more diversity to my diet. Alright, I have another question about Mushlabs. What is the stage your company is currently at?

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Cathy:

There are around 60 people in the company now and we are very close to entering the market. Furthermore, we have already scaled our technology and we are already discussing where to sell our products. It's not just a lab idea or a lab concept that we're working on but we have a broad team that really focuses on making sure that the product can be delivered to retailers, restaurants, etc.

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Diana:

Great to hear that, I’m excited to see you on the market soon! Now, talk to me please about the regulations. You’ve already mentioned them. But please elaborate on how they impact your go-to-market path.

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Cathy:

Overall, I think regulations are the biggest challenge for startups when it comes to developing something really new and innovative. Because you always need to go through the process of regulations, unless you are working on something that already exists. Looking at this from the European perspective, of course, we are fully supportive to control who is getting access to the market and how it may impact the consumer. Because at the end of the day, it's really just about protecting our final consumers, which is a great thing that we have.

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Cathy:

Nevertheless, the process of it is super complex and it's really untransparent, how to get there, what is needed, and each process of going through the approval process is very different. You can barely find someone that guides you through the process. And it is especially challenging for startups since you need a lot of documentation to prove that your product is safe and that it's good for consumption. This can easily turn into a couple of years of just documenting and collecting all the data, and finding the right labs to provide these data to the European Union without being 100% sure that you are collecting the right set of data.

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Cathy:

This is something that ideally improves with the support of the government to an attitude like ‘we want to support innovation, we want to guide you and help you through this process’. Because, otherwise, you will only end up with a situation where only big corporations will be able to bring novelty to the market.

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Diana:

I definitely can see the problem, and I very much hope we’ll see some changes there soon. Let’s talk about the competition for a moment. How would you describe your competitors? What kind of products are they?

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Cathy:

That's the question on how you look at the competition. In theory, it could be each item that tries to have the same value as our product in the end. But I think the direct competition for us currently is in plant-based alternatives. Where we see the clear competitive advantage of our products is that they don’t need as much time and space to produce as for example soy-based products. Consider that soy needs approximately 150 days and a very big surface to grow which in the first place means the deforestation impact. In our case, the space it takes is only about a fermenter and the time is about a week.

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Cathy:

When we look into the products that are made of soy, most of them, if not all, focus on the protein of the soy. The process of isolating the soy protein out of the full soybean creates approximately 30% protein from the soybean hence you are left with a big amount of food waste. Additionally, you lose in this process the nutrients that soybean naturally offers. In our case, we don’t need to intervene much with the process as it is in nature. And as a result, we preserve most of the nutrients mycelium can provide.

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Cathy:

We use much less water than a soy plant standing on the field for a couple of days. And we don't need to build logistics to transfer our products since you can put a fermenter wherever you want. In the case of soy, you can grow it only in specific regions, and its growth heavily depends on the surrounding conditions. And again, for us, it's about bringing a product with a dense protein structure and high nutritious value in the most natural way, without over-processing and without creating food waste in our production process.

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Diana:

Finally, tell me a few words about you and your company’s missions.

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Cathy:

I guess this is where we are much more aligned. We want to create a food system that is sustainable, and we really want to change the current food system. We want to provide healthy and delicious meals to everyone and not just single individuals in the most sustainable way.

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Diana:

‍Thank you a lot, Cathy, it was a pleasure to talk to you!

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Cathy:

Thank you, talk soon!

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Connect with Diana and Anne-Cathrine on LinkedIn.