A ‘microbrewery’ to turn methane into fish feed

A small lab in a corner of the hall reveals its true identity as a production facility of biotech startup String Bio. In the garden are cylinders of CNG and biogas. These get piped into the ‘microbrewery’ to be fermented by handpicked microbes into organic protein for fish and poultry feed.

The startup is developing the biotech to turn methane from waste or natural gas into monomers, which become the building blocks of protein for various uses. Its first product is an organic protein supplement for fish. It’s a B2B (business-to-business) player whose product goes to other companies that make fish feed. The main sources of protein for aquaculture currently are soybean and small fish that are crushed and added to the feed.

“Our product is better than soymeal and equivalent to fishmeal," says Vinod Kumar, String Bio MD and co-founder. “We have done trials with university labs and early adopters to test the product on parameters like the growth rate of fish and we’ve got good results. We’re in the process of figuring out the cost of producing this at a competitive rate to existing fishmeal."

Sustainability would enter the equation as well. The effects of soybean cultivation on rainforests is well documented. So is the indiscriminate harvesting of marine fish for crushing into fishmeal. Hence the search for alternative aqua and poultry feed from biotech ventures.

CONVERTING WASTE

One of the challenges for String Bio is to get methane in sufficient quantities to scale up the venture. Biogas is a good source, and there are environmental benefits in converting waste and a greenhouse gas into fish feed. But its availability is still too low and fragmented for industrial scale.

String Bio is therefore targeting natural gas. It will set up large production units close to gas fields in Tamil Nadu, Gujarat and the North-East as well as abroad. The startup will need thousands of kilos of methane everyday for unit economics to reach commercial viability. Partnership with the Oil and Natural Gas Corporation (ONGC) is a step in that direction.

After several years under the radar while it developed proprietary technology, String Bio became the first Indian startup to get backing from French VC Seventure Partners, which has nearly a billion dollars of assets under management. One of Seventure’s focus areas is life sciences and it launched a thematic fund, AVF, to support the growing need for innovation in animal nutrition and health. Last year’s String Bio investment came from this fund.

“Innovative players able to deliver new sources of proteins in a traceable way, which is the case with fermentation, will make a lot of sense for different players along the value chain," says Laetitia Gerbe, partner at Seventure Partners looking after investments from AVF fund. One of the core investors in AVF is Adisseo, an industry leader in animal feed. “They audited us and believe there’s a market for what we’re trying to do," says Kumar, pointing out that String Bio is the only one in Asia converting methane to protein for aquafeed. Danish biotech startup Unibio and US-based Calysta are also working on this. Two other US startups, Kiverdi and Novonutrients, are trying to make protein from carbon dioxide.

It was Kumar’s wife, Ezhil Subbian, with PhDs in biochemistry and biophysics from Oregon and Rutgers universities, who started String Bio in 2012. She had worked with biotech labs and startups in the US before that.

“I’ve been enamoured with using the power of biological systems to make fundamental chemical changes," says Subbian. “The theme for me has been where to apply the technology and how to make it more efficient. I saw gaps in the industry and working with different startups gave me exposure not just to technology development, but also the IP, building the team, figuring out product-market fit, fund-raising, all those aspects."

She bootstrapped the startup through its tech development phase with some support from government grants and incubation centres. Her husband came on board in 2015 when it was time to build the business. Kumar was a senior director at Juniper Networks in the US, and worked for telecom companies Lucent and Alcatel earlier. “Every day at home I spoke so much about the potential of biotech that I convinced Vinod to jump aboard fairly quickly," says Subbian with a laugh.

BENGALURU EDGE

Fermenting a gas with bacteria to produce protein with the right set of amino acids for a specific feed is complex. Apart from the knowhow, there’s considerable grunt work in the permutations and combinations to find the right variants of microbes and evolving them on different formulations of methane, ammonia and mineral salts. Add to that the engineering to make it a commercial process. US startup Codexis, where Subbian was a technical lead, had 20 robots to support the work.

In Bengaluru, without access to that kind of automation, she had to improvise. This meant relying on “gut feel" and expertise in deciding what would work instead of leaving it all to the machine. It was like going from driving a Ferrari on the autobahn to negotiating Indian roads in a Maruti.

Being in Bengaluru had its advantages, however. India is among the world’s top exporters of shrimp. This places String Bio near some of the biggest end users of its aquafeed. “Rather than develop something in the West and bring it here, we wanted to see what would work in this ecosystem and build it from the ground up," says Subbian.

This applies to all aspects of the venture, starting from the core technology. “There are two ways to build the technology," explains Subbian.

“You can have a Ferrari with all the bells and whistles or you can have a system that’s cost-efficient. Typically, you start with the Ferrari and slowly make it cost-efficient. Our way was to start with what is cost-efficient because it had to be capex and opex optimized for this end-user market," she says.

The next milestone is to set up a large industrial production unit, which will require another round of funding. Kumar is optimistic. “I remember talking to investors when we started out, and they were like, ‘What are you guys doing? Is there a need for it?’ But in the last two years, the alternative protein space has got so much visibility."Aquafeed and poultry feed are just the start. A corner of the String Bio compound has a nursery where beds of spinach, radish, tomato and broccoli plants are thriving on feed produced from methane.

Sumit Chakraberty is a consulting editor with Mint. Write to him at chakraberty@gmail.com