"Yeast-Based Palm Oil Alternative Debut in 2025 by A̧io Eyes Cosmetics, Following Notable Manufacturing Breakthrough"
Tallinn-based biotech firm Aio has made a significant breakthrough in the production of its yeast-derived palm oil alternative, Encapsulated Oil. The company, which has already raised €7.2M from investors, is targeting the cosmetics industry first due to the shorter regulatory pathway and strong industry interest in replacing petroleum-based and tropical oils with sustainable alternatives.
Aio's Encapsulated Oil, high in protein, fibre, and functional lipids, can be used in food products like plant-based patties, baked goods, and confectionery. In the cosmetics industry, Encapsulated Oil offers nourishing properties with additional bioactive benefits, acting as a natural alternative to mineral oils that can harm both the skin and the environment. RedOil, another product developed by Aio, is a deep red-hued oil that can be swapped for fish oil and seed oils.
The company is aligning its product development with EU regulations for both the food and cosmetics industries. Aio has filed for novel food approval for its ingredients and plans to launch its first cosmetic ingredient by late 2025, initially through B2B collaborations with selected brands. Food applications will follow post-regulatory approval.
Aio has already reduced its unit costs by 80% through scale and optimization and expects to continue with a similar cost reduction curve for the foreseeable years. The location of Aio's commercial facility is yet to be determined due to negotiations with potential industrial partners. The company plans to begin fundraising again in a year's time.
The production of Encapsulated Oil is set to increase from 1 tonne per year to between 2,000-4,000 tonnes per year once Aio's own full-scale factory is built. The company is establishing partnerships for feedstock supply, distribution, and offtake agreements for its commercial facility.
Aio's products, RedOil and ZymaLipid Complex, are currently gaining the most traction in cosmetics due to their texture, high performance, and additional bioactive properties. The company is not explicitly named in the search results provided as planning to establish a commercially usable factory by the end of 2028 in cooperation with an industry partner. However, the NLND Berlin Campus project involves Philip Morris Deutschland and Green City Development GmbH as key players in industrial transformation, but no specific factory timeline to 2028 is mentioned.
As Aio moves forward, it is poised to make a significant impact in the cosmetics and food industries with its sustainable, high-performing, and bioactive ingredients.
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