$8M Investment Boosts Diet-Friendly Foods
Sweet treats and fried foods that are low in fat and calories may seem a dieter’s dream, but that’s Indianapolis-based Epogee’s mission, and it’s now backed by millions. The startup recently earned an $8.3 million investment from HG Ventures, also based in Indianapolis. The two locked eyes in the lab due to the chemistry—Epogee has created a food ingredient that it says provides the same taste, texture and appearance of fat, but with 30 to 40 percent viewer calories. When scientists at HG Ventures examined the chemistry, they determined Epogee may have discovered the recipe to indulge.
Epogee says its fat replacement will allow people to enjoy their favorite foods, but with 92 percent fewer calories from fat. The U.S. Food and Drug Administration (FDA) has approved three iterations of the fat replacement: one designed for chocolates and coatings, a second for baking and spreads and finally, a version for fried foods.
Epogee’s leaders and collaborators—many of them Dow AgroSciences alumni—spearheaded the science, which starts by dividing GMO-free vegetable oil into its components: glycerin and fatty acids.
Chemists pull apart the three chains of fatty acids and insert a connector; Epogee says this tweaking of the fat molecule prevents the enzymes that break fat apart from working and releasing calories.
“The intersection of great taste and calorie reduction is something that really resonates with a wide audience—nutritionists, marketers, senior leadership,” says Epogee Chief Executive Officer John Musselman. “You really start seeing a light bulb go off when they realize they can make everyday foods, or reformulate everyday foods, that people are already enjoying and reduce the calories to make a meaningful impact on global nutrition and obesity. It’s quite compelling.”
Blommer Chocolate Company, the largest cocoa processor and ingredient chocolate supplier in North America, is one of Epogee’s clients. While the startup can’t share the names of other clients, Musselman says it has “a number of interesting engagements going.”
“A lot of the customers we’re collaborating with oftentimes have a portfolio of products that touches on various categories—people making confectionary products and baked goods,” says Musselman. “So if we partner with them to make meaningful nutritional enhancements across their portfolio, it’s something that really resonates with customers and manufacturers.”
The startup is currently targeting baked goods and the protein category, such as protein bars and snacks, as consumers demand more protein in a variety of products.
“For example, when product formulators are tasked with putting plant protein in and taking sugar out, they often run into sensory challenges; some of the plant proteins certainly have some off notes or sensory attributes, so it’s hard to make products that taste good,” says Musselman. “If we’re providing an indulgent, full-flavor mouth feel, but keeping the nutritionist happy from a calorie and labeling perspective, we’re able to check a lot of boxes for some of these major food companies.”
From a channel perspective, Epogee is also investing in go-to-market strategies in food service—perhaps a sweet spot as the FDA now requires restaurants to display calorie counts on menus.
Epogee is the second investment for HG Ventures, created in 2018 as the corporate venture arm of Indianapolis-based The Heritage Group.
“The opportunity to provide much, much lower-calorie food products is a really important, huge health benefit to society, and not just a trend,” says HG Ventures Managing Partner Kip Frey. “We hope there are food products in many, many categories that contribute to people’s health, reduce fat and make people’s lives better—it’s really that simple.”
Epogee will use the $8.3 million to boost research, scale production, speed its go-to-market strategy and deliver “best in class” prototypes to customers.
“[The capital] really gives us a war chest to invest in things like prototypes to show customers and potential collaborators how Epogee works in various food matrices,” says Musselman. “If we can build a business that’s doing some good on moving the needle on nutrition globally, allowing people to eat the foods they want that taste great—but also have some improvements in nutrition—that’s pretty exciting.”