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Magical Mushroom Company secures €3.4M to develop biodegradable packaging made from mycelium

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3 min read
AUTHOR: Fiona Holland
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British start-up Magical Mushroom Company has raised €3.4 million (£2.9M) in a seed funding round for its compostable packaging made from mushroom mycelium.

The packaging is made by mixing mycelium with agricultural waste. Mycelium is a root-like structure in mushrooms’ vegetative tissues. It contains chitin, a naturally water- and flame-resistant polymer that acts as a glue which binds the mixture together with agricultural waste.

The mixture is then baked into hard-wearing packaging, and can be used after six days of growing and kiln drying.

The company says their packaging is “biodigestable”, allowing it to be broken down without oxygen. As stated on its website, “In large scale industrial anaerobic digestion trials, Mushroom Packaging proved to be both effective and beneficial in drying out wet food matter, typically found in kerbside food collections.”

Magical Mushroom Company plans to use the newly raised funds to open its first raw material production plant in Beeston, Nottinghamshire. This will allow the start-up to recruit for new roles and have control over the complete packaging manufacturing process.

Automation upgrades will also be put in place at the company’s packaging plants located in the UK and Bulgaria, which will help to limit costs and scale up production.

Paul Gilligan, CEO and Founder at Magical Mushroom Company, said in a statement: “We have just eight years to meet the UN’s Sustainable Development Goals and businesses have a crucial role to play – but they need viable and cost-effective solutions that significantly reduce the carbon footprint across their entire supply chain.

“We’re proud to be creating value from waste and unlocking the potential of mycelium – a resource that has been untapped to date. We’re delighted to have the support of a brilliant group of investors who have a wealth of experience in driving sustainable change and share our vision for the future of packaging solutions. The magic of mushrooms is only just being realised and we can’t wait to make it mainstream.”

Ecovative Design LLC, the American biomaterials company who invented and patented the mushroom technology and is partnered with the start-up, led the seed round. Magical Mushroom Company also has an exclusive licence agreement with Ecovative for packaging applications in the UK and EU.

Dale Vince, founder of green energy company Ecotricity also contributed to the investment, as well as British artist and Massive Attack musician Robert Del Naja, and co-founder of Adoreum Partners Marcus Watson, who also brought in 30 other investors.

Thomas Van Haren, Director of MycoComposites at Ecovative Design LLC added: “The packaging industry is ripe for change and innovative solutions must be supported so that we can move away from our reliance on fossil fuels.

“In the Magical Mushroom Company, a viable alternative already exists that is producing high-quality sustainable packaging on an industrial scale. Paul and his team have made incredible progress in a short period of time as demonstrated with the opening of their latest high-tech plant in the UK. We were inspired by their vision to scale the business and we’re looking forward to supporting their mission to help remove polystyrene packaging from manufacturing supply chains.”

The company is already working with several big names including Selfridges, Seedlip, Lush, BA Components, Castrads, ID Watch and Ffern.

Mushrooms are proving to be popular in the world of foodtech. Earlier this month, Tetra Pak and start-up Mycorena announced the opening of their new plant for the production of alternative proteins using fungi fermentation.

In May 2022, ENOUGH and Peace of Meat also teamed up to combine cultivated fat biomass and fermented fungi mycoprotein to add a meaty mouthfeel to ENOUGH’s mushroom-based products.

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