Global Sustainable Transformation (GST), a spin-off from the Technical University Munich, replaces conventional raw materials such as cocoa butter, palm oil, and sunflower oil in food, cosmetic, and oleo-chemicals, with cutting-edge biotechnology. Its patented FHCR technology, a platform that enables the production of triglycerides, bio-actives, and bio-based polymers for various applications, is centered around a unique fermentation process which transforms organic waste streams into high-value intermediates for a circular bioeconomy. Applications include food, cosmetics and biofuels. The company says it is in the process of closing deals with a large European supermarket chain and a U.S. oleochemicals manufacturer.
“Our technology enables highly efficient, waste-free, low-carbon production and solves supply chain issues,” says GST founder Dr. Mahmoud Masri.
GST is one of 60+ startups that will be pitching to investors and industry leaders at the December 10 Ultimate Demo Day at Unternehmertum, the start-up lab of the Technical University of Munich.
GST’s technology evolved from Masri’s PhD work at the Technical University of Munich in 2013. He and a team have been working on perfecting it since then and launched GST in 2022 in the Munich area after securing grants of €1.5 million from SPRIN-D, a German government agency devoted to enabling breakthrough innovations from Germany, and €1.2 million from the European Union.
One of the first targets for GST’s technology is the chocolate industry. “GST’s butter is 100% chemically similar to cocoa butter but it is not produced by any plant, it is produced by a yeast,” says Masri. “We are talking with every company in the cocoa business, from chocolate manufacturers to traders and distributors, he says. “They have all tested our yeast butter and told us that it is identical to cocoa butter.”
That is important because over the past year, cocoa prices have roughly quadrupled, following poor harvests in Ivory Coast and Ghana, the two countries that produce most of the world’s supply. Processors have scaled back or shut down, leaving chocolate-makers without the usual reserves of cocoa butter and liquor. Meanwhile, demand for chocolate is rising, with the global market forecast to exceed $250 billion this year. So it is no surprise that Crunchbase reports that there is an uptick in investor interest around startups developing alternatives to chocolate. Among them are the U.S.’s Voyage Foods and California Cultured as well as Munich-based Planet A.
“Every month we hear about new startups that also use a yeast-based process or fermented cocoa butter,” says Masri. “The difference with FDHR is our 12-year-validated technology with superior efficiency is protected by seven patents, and we are already at demo scale.”
GST has other important differentiators, says Masri. GST also offers clients a major sustainability benefit, says Masri. The yeast in GST’s process needs to be fed with something. One potential feedstock is leftover bread from bakeries, which can be processed and made into GST’s cocoa butter equivalent, and used to make new chocolate pastry products, enabling supermarket chains or food producers to become a part of the circular economy, says Masri.
In addition to solving supply chain issues, he says clients can save up to 70% over what competitors are charging for chocolate alternatives and “when we go to large scale production, we expect to be able to be competitive with cocoa butter and maybe later with palm oil,” he says.
GST also makes an alternative to palm oil, one of the world’s most widely used vegetable oil. Palm oil , which accounts for about 40 % of all vegetable oil produced globally.is used in half of all supermarket products – from beauty and cosmetic products (such as soap, toothpaste and lipstick) and processed foods (such as chocolate, biscuits, instant noodles, margarine and ice cream) to candles, detergents, animal feed and biofuel.
Global production of and demand for palm oil is increasing rapidly so plantations are spreading across Asia, Africa and Latin America. Rising consumption increases the risk of tropical rainforests being cut down and burned to make way for plantations, causing greenhouse gas emissions and threatening the extinction of orangutans, pygmy elephants, and Sumatran rhinos, according to the World Wildlife Organization. Palm oil production is also responsible for human rights violations as small landowners and indigenous people are driven from their land to make way for plantations and some plantations are being accused of using child-labor.
Against that backdrop, GST can offer companies involved in food production and distribution four key advantages with its palm oil yeast-based alternative product: Clients can use GST’s technology to produce a palm oil replacement product themselves, enabling a stable supply and avoiding environmental harms and ethical issues; use of a yeast-based palm oil will help clients reduce their own environmental footprint as the alternative product is made from waste streams converted into new products; the palm alternative is healthier for humans as it is infused with vitamin D2; and GST’s alternative has a longer shelf life, Masri says.
The current price of palm oil is €1.2 to €1.5 per kilo: GST said the price of its palm oil alternative is €5 to €6 per kilo. It expects to be able to reduce the price to around €1 per kilo by 2030 once it opens its first production plant and can scale, making it comparable to palm oil.
GST’s technology can also replace sunflower oil used in frying applications and to make more environmentally friendly biofuels, Masri says.
He says clients can either buy the yeast butter alternatives directly from GST or GST will provide the technology for clients to make the alternatives themselves under a licensing agreement.
The company is actively seeking strategic partnerships, Masri says.
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