Fermtech secures £2.5m to scale cocoa alternative

Fermtech, a biotechnology firm specialising in crop-value fermentation, has raised £2.5 million in seed funding to scale the production of Koji Cocoa, a sustainable cocoa alternative that promises to shield food manufacturers from the extreme price volatility of the global cocoa market.

The investment round was led by climate specialist investor Elbow Beach, contributing £2 million, with additional participation from Carbon 13 and Empirical Ventures. The capital is earmarked for the international scale-up of Fermtech’s fermentation platform and the commercial deployment of Koji Cocoa in the UK and beyond.

Fermtech Koji Cocoa.

The launch coincides with a volatile era for the $27 billion global cocoa ingredients market. Climate change and crop disease have slashed cocoa yields by an estimated 30%, sent prices soaring, and compressed margins for confectionery and bakery manufacturers.

Fermtech’s solution, Koji Cocoa, takes a circular economy approach by utilising cocoa shells — a side stream of the cocoa plant that is traditionally discarded. Using centuries-old solid-state fermentation, Fermtech transforms these shells into a true-tasting, clean-label ingredient that preserves the natural flavour, colour, and texture of traditional cocoa.

For food manufacturers, the value proposition of Koji Cocoa is three-fold:

1. Significant cost savings: the ingredient delivers a 25%–33% reduction in costs for chocolate and baked goods, offering a vital buffer against rising commodity prices.
2. Environmental impact: the process achieves up to 98% lower carbon emissions than traditional cocoa production and requires no additional farmland.
3. Supply chain resilience: by unlocking more value from existing crops, Fermtech provides a domestic, scalable supply of cocoa-equivalent ingredients that are less susceptible to the environmental shocks affecting the Cocoa Belt.

Unlike many synthetic alternatives, Koji Cocoa is produced through natural biological processes that break down indigestible components into nutritious, soft ingredients.

“Fermtech has been committed from the start to extending the value we get from our crops, using the power of biology to unlock flavour and nutrition,” said Andy Clayton, CEO of Fermtech. “This investment allows us to scale our production and get delicious foods into consumers’ hands.”

Jonathan Pollock, CEO of Elbow Beach, added that the technology is a “bold innovation” that is “commercially resilient and scalable while solving a real market problem.”

Fermtech is already in active engagement with major global food and snacking players, positioning Koji Cocoa not just as a niche sustainable option, but as a primary tool for manufacturers to maintain product quality while meeting increasingly stringent ESG targets.

Fermtech Koji Cocoa at a glance