Estonian startup pioneers microbe-based fermentation to replace palm oil with fats made from agricultural waste
A Startup Born from a Dream — And a Microbe
In the heart of Estonia, ÄIO — named after the Estonian god of dreams — is working to transform how the world produces fat. What sounds like science fiction is quickly becoming science fact: edible fat made from sawdust and other agricultural waste.
This novel innovation, showcased at TechCrunch Disrupt 2025, stems from the doctoral research of biotechnologist Nemailla Bonturi, who created a new strain of yeast that doesn’t ferment sugar into alcohol or gas, but into fat molecules. Co-founder Petri-Jaan Lahtvee, a professor of Food Tech and Bioengineering, helped optimize and scale the idea for real-world use.
From Waste to Worth: The Fermentation Breakthrough
The core of ÄIO’s technology is a precision fermentation process that feeds agricultural waste sugars — from corn, sugarcane, and lumber byproducts — to their custom yeast.
- The yeast consumes sugars and outputs fats, similar in composition to animal fats.
- The result is a solid fat resembling chicken fat, or a liquid oil alternative to rapeseed or canola.
Unlike conventional fat production, which often involves environmentally destructive practices, ÄIO’s approach is waste-positive and land-efficient — turning otherwise unusable byproducts into valuable resources.
A Sustainable Alternative to Palm Oil
ÄIO’s fat could be a game-changer for the palm oil industry, a sector heavily criticized for its role in deforestation and ecosystem destruction.
- Palm oil is widely used for its emulsifying and preservative qualities in food and cosmetics.
- ÄIO’s fat has a comparable molecular profile but is cleaner — reportedly more pure than vegetable oils, and free from pesticides.
By reducing dependency on tropical plantations, ÄIO offers a climate-smart and scalable solution for global manufacturers seeking ethical alternatives.
Growth, Funding, and Global Interest
Launched in 2022, ÄIO has quickly gained momentum:
- Raised $7 million in venture funding.
- Signed over 100 collaboration agreements with global companies.
- Won the 2024 Baltic Sustainability Award.
The team plans to build a commercial-scale facility by 2027 and is preparing for regulatory approval across multiple countries, beginning with Singapore, known for its progressive stance on food innovation.
Looking Ahead: Licensing, Scaling, and Impact
As ÄIO scales its operations, it aims to license the technology to food and cosmetic manufacturers worldwide — making the tech accessible and impact widespread.
- Commercial production is targeted within two years.
- Regulatory hurdles remain, as each country must approve the fat for human consumption.
- The company continues refining its fermentation tech for better yield and broader applications.
Founders Bonturi and Lahtvee remain focused on scientific integrity and sustainable growth, grounded in the belief that innovation can originate from even the smallest countries.
Not Just Science — A Shared Dream
For Bonturi, the mission is personal. “We want to show that two scientists from a small country can change the world — even if just a little,” she says.
ÄIO isn’t just creating a product. It’s reimagining waste, rethinking food, and giving rise to a new kind of industry — one built on the values of sustainability, innovation, and global impact.
