Äio (pronounced EYE-oh) is recognized in Estonian mythology as the deity of dreams. The name fittingly belongs to a promising startup from Estonia, also called ÄIO, which has created a method to transform agricultural byproducts such as sawdust into fats suitable for use in food and cosmetics.
This innovative approach could help decrease global reliance on palm oil, a common ingredient in food and beauty products due to its stabilizing and preservative qualities. However, the palm oil industry, which thrives in tropical climates, has been heavily criticized for causing deforestation and damaging delicate ecosystems to make room for plantations.
ÄIO was established by biotechnology experts Nemailla Bonturi and Petri-Jaan Lahtvee, building on Bonturi’s doctoral discoveries. During her research, she engineered a novel yeast strain. Unlike traditional yeast used in bread or beer, which turns sugar into carbon dioxide or alcohol, this yeast produces fat molecules from sugar. The company will present its technology at this year’s TechCrunch Disrupt Startup Battlefield, taking place later this month in San Francisco.
Lahtvee, formerly a professor of Food Technology and Bioengineering at Tallinn University of Technology in Estonia, led his own biotech research group there in 2016, with Bonturi as his first team member. She introduced her yeast innovation to the lab, and together they refined it to withstand industrial production.
Given Estonia’s significant output of corn, grains, sugarcane, and timber, the team explored how sugars derived from these agricultural leftovers could be used to feed the yeast. “We began developing metabolic engineering tools to work on this,” Lahtvee explained to TechCrunch. Their findings showed the yeast could efficiently metabolize these sugars.
According to Lahtvee, the fat produced by their yeast closely matches the profile of conventional fats, and in its solid state, it most resembles chicken fat. By adjusting the fermentation process, they can also create a liquid oil, making it a potential substitute for oils like canola or rapeseed.
By 2022, the founders realized their solution was commercially promising and officially launched ÄIO, aiming to attract investors and form business partnerships. To date, they have secured around $7 million in funding, developed precision fermentation techniques, received the 2024 Baltic Sustainability Award, and attracted interest from over 100 companies worldwide, according to the startup.
“After extensive testing, we’ve found that our final product matches the quality of vegetable oils, but without the pesticide residues—it's even purer,” Bonturi shared with TechCrunch.
Looking ahead, the company intends to construct a facility capable of producing fat at scale by 2027 and to license their technology to other food and cosmetic producers. They will also need to obtain regulatory approvals to sell their fats as food, likely beginning with Singapore, which is known for its openness to alternative food innovations.
“Naturally, since this is a new approach to food production, we must undergo all necessary regulatory reviews and testing,” Bonturi noted.
As these initiatives move forward, Bonturi expressed her hope that “two scientists from a small nation can truly make a positive impact on the world, though that’s my own aspiration.”
If you’re interested in hearing directly from ÄIO and discovering many other startups, watching their presentations, and attending talks across four stages, join us at Disrupt in San Francisco from October 27 to 29. Find out more here.
