BlueNalu believes it has successfully charted a path to profitability.
The cell-cultured seafood pioneer recently commissioned a techno-economic analysis (TEA) to validate the company’s commercialization pathway for a planned large-scale production facility of a bluefin tuna toro product. The results project a 75% gross margin.
The significant profitability of the planned production facility is due, in part, to a series of breakthrough technologies by BlueNalu that are expected to drastically reduce both operating and capital costs for large-scale production when combined with the company’s premium product and market focus.
“We were a bit excited at the results because we were very conservative in our analysis,” said Lou Cooperhouse, BlueNalu co-founder, president and CEO.
The TEA was performed in collaboration with a leading global Engineering, Procurement, and Construction (EPC) firm and experts in bioprocess modeling. The work was conducted in order to model the technological performance and economic considerations of BlueNalu’s cell-cultured seafood production, incorporating the company’s technical milestones.
The TEA required an in-depth evaluation of every piece of equipment, all associated costs, and the technologies and assumptions that will result in the Capex, OpEx, and production capacity of BlueNalu’s first large-scale facility. The analysis validated that the incorporation of single-cell suspension and lipid-loading could result in more than 5x cost reduction compared to production methods that do not utilize these technologies.
To achieve commercial viability, the cell-cultured protein industry must overcome considerable technology challenges such as scalable cell growth technologies; the development of food-grade raw materials; production methods that enable regulatory approval and consumer adoption; and processes that support continuous volume production. Because of these challenges, species selection, product format and market fit are critical factors in the profitability equation.
“We believe that BlueNalu is the only company in the cell-cultured seafood industry to overcome each of these technology and market challenges, which will result in a scalable and highly profitable solution with demonstrable consumer benefits,” Cooperhouse said. “We are pleased to announce that we have ‘cracked the code’ for creating significant profitability.”
‘Whole Muscle Product’
BlueNalu’s breakthrough technologies include a non-GMO, single-cell suspension line with high growth rates that are expected to accelerate the company’s scale-up to large bioreactors. This also includes a lipid-loading technique, that is projected to result in a significant reduction in capital expenditures and enable the company to make products with higher fat profiles and sensory attributes, such as the toro portion of bluefin tuna.
“Over the past four years, our team has achieved remarkable scientific milestones which enable us to overcome the fundamental technology barriers required for success,” said Lauran Madden, Ph.D., CTO at BlueNalu.
“In tandem with the plans for commercialization of our bluefin tuna, our team has continued to explore additional species using our platform technology,” Madden added. “So far, we have developed hundreds of cell lines for eight different finfish species, and we have initiated projects to expand into other premium seafood categories.”
In addition to the new lipid-loading technique, BlueNalu also designed downstream processes to allow for continuous production and eliminate the need for plant-based scaffolds or micro-carriers which can affect product cookability, scalability and flavor.
“We are doing whole muscle products, we are doing bluefin tuna toro, same as conventional product. It’s the real thing,” Cooperhouse said, adding that because BlueNalu is not relying on adding ingredients, the company sees “a simpler path” to approval by FDA.
BlueNalu’s choice to first focus on a high-end fish cut like bluefin toro – which Cooperhouse described as “the Wagu beef of the sea” – was part of the company’s profitability strategy to scale up and to show consumers the real value of cell-cultured seafood.
“What we’re representing with BlueNalu and our launch with bluefin tuna is we are a culinary-centric company, grounded in technology that’s very differentiated, but we’re going after that holy grail experience – a delicious product that offers all these benefits that’s consistent every time,” Cooperhouse said.
Those benefits, he added, include a more predictable supply and quality of fish; a 100% yield with no back of house labor; and no environmental contaminants like mercury or microplastics.
Already, the benefits of BlueNalu’s value proposition has attracted a number of strategic partners from around the world, which include leading multinational companies such as Food & Life Companies, Mitsubishi Corporation, Pulmuone Corporation, Sumitomo Corporation, Thai Union, Nomad Foods, Nutreco, Griffith Foods and Rich Products.
To supply those global partners, BlueNalu has designed a large-scale facility that will enable multi-species capability and produce up to six million pounds of premium seafood products annually, utilizing eight 100,000L terminal bioreactors. The approximately 140,000 square-foot facility will follow Good Manufacturing Practices (GMP) and BlueNalu anticipates that this factory will be able to commence production in 2027.
“Our projected 75% gross margin within the first year of production of our large-scale facility is unheard of in the food industry,” said Amir Feder, CFO at BlueNalu. “This sets a very strong growth trajectory for the company, as we introduce additional products and establish new facilities around the globe.”
A location for the large-scale facility has not yet been chosen, but Cooperhouse expects it will be within 100-150 miles from its current 38,000 sq. ft pilot production facility in San Diego, which will serve as the company’s innovation center, introducing additional species and product forms for market testing over the next few years.
CEO: Lou Cooperhouse
Headquarters: Sorrento Valley
Business: Cell-cultured seafood products
Notable: Celebrity chef Roy Yamaguchi is a BlueNalu investor and serves on the company’s advisory board.