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Feb. 3, 2025
by Elaine Watson, AgFunder.com The economics of large-scale insect farming have come sharply into focus this week with struggling industry pioneer Ÿnsect "exploring all possible options, including the possibility of a third-party takeover," while fellow French startup Agronutris has filed a safeguard plan with a commercial court. The news comes weeks after Canadian cricket farmer Aspire Food Group laid off two thirds of its staff and announced plans to scale back production to conserve cash while it makes improvements to its process. Founded in 2011 by Antoine Hubert and Alexis Angot, Ÿnsect has raised almost $580 million over the past 13 years from investors including Astanor, BPI France, Crédit Agricole, Upfront, and Robert Downey Jr.'s Footprint Coalition. The firm, which honed its mealworm farming process at a pilot facility in Dole, France, started protein production at a large-scale facility in Amiens, France, last summer, but needs to secure more funding to get to a scale whereby it can "ensure profitability." Ÿnsect, which filed a safeguard plan with a commercial court last September, issued a tender offer on January 17 to determine interest from potential investors or acquirers by February 17, 2025. According to the document, Ÿnsect's revenue was €5.8 million ($6 million) in 2023 with "third-party liabilities" of approximately €104 million ($108 million) excluding bonds. "The figures for 2024 are not consolidated for the moment," said a spokesperson. The company, which has 214 employees at facilities in Amiens, Dôle, Evry, and Paris, says it needs to secure about €130 million ($135 million), excluding liabilities, to achieve target revenues of €131 million ($137 million) in 2028. If no investors come forward by February 17, 2025, the company could face court-imposed restructuring, forced asset sales, or liquidation. Agronutris files safeguard plan with French court Fellow French insect ag startup Agronutris, meanwhile, has filed a safeguard procedure with a commercial court in Sedan for its holding company EAP Group. Based in Toulouse, EAP Group is responsible for Agronutris' R&D activities and administrative functions. The agreement does not cover the group's subsidiary Ardennutris, which produces oils and proteins from black soldier flies at Rethel in the Ardennes. The safeguard procedure, which lasts for six months but can be renewed for an additional six months, gives EAP Group breathing space to restructure, find new investors, and renegotiate its debt. Agronutris originally focused on human food but later pivoted to focus on aquaculture and pet food. It raised €100 million in October 2021 from backers including SPI fund and the Mirova fund to construct the commercial-scale facility at Rethel, which started production in 2023 and announced partnerships with BioMar (insect meal for aquaculture) and Frayssinet (insect frass for fertilizers). However, the funding environment has changed significantly since 2021, noted the company, which said in the release that grim news from others players in the segment had further soured investor sentiment. "Access to financing is made more difficult by an uncertain economic context and investors slowed down by the news in the sector and the announcements made recently by other industrial players". 'A supply-constrained market' A spokesman for Agronutris told us: "In practice, this decision reflects EAP Group's commitment to giving itself time to stabilize its financial situation, renegotiate its debt with creditors, and ensure operational continuity." To read the entire article click here.
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