Rocketed out but rising: Foodtech startup Blue Tree raises $2.26M despite Hezbollah attacks
Rocketed out but rising: Foodtech startup Blue Tree raises $2.26M despite Hezbollah attacks
Despite having to relocate from its facilities in Kiryat Shmona due to the war in the north of Israel, Blue Tree attracted fresh funding, including from French giant Sucden.
Despite having to close its facilities in Kiryat Shmona due to Hezbollah missile attacks, Israeli foodtech startup Blue Tree announced on Tuesday that it has raised $2.26 million, including from French giant Sucden.
The round was led by OurCrowd with participation from Sucden Ventures, the VC arm of the Group Sucres et Denrées, a French-based company specializing in alternative proteins, novel ingredients, and plant and crop sciences. Blue Tree also announced that it obtained self-affirmed FDA food safe status for its proprietary sugar reduction technology and system, in accordance with the requirements laid out by the U.S. Food and Drug Administration (FDA) for food and food contact materials.
Blue Tree was founded in 2020 by Didier Toubia (co-founder and CEO of cultivated meat startup Aleph Farms). The company’s technology uses advanced separation techniques to selectively remove naturally occurring sugar molecules from beverages such as juices, milk, and beer. This approach preserves essential nutrients, aroma, and texture while reducing sugar levels. The company’s system is designed for easy integration into existing production lines and includes design, integration, and maintenance services. This innovation enables beverage companies to offer healthier options without sacrificing taste.
“On Oct 7th, our primary focus was on the safety of our team, as many faced reserve duty and had to evacuate their homes along with their families,” said Michael Gordon, Blue Tree CEO, “and we quickly adapted to the situation with a reduced team but heightened determination.” Discussing the company’s resilience, he continued, stating that “we secured a new location and continued with both fundraising and product development. During this period, Blue Tree strategically expanded its solution to encompass additional categories. Although we remain displaced from the northern Israeli AgTech valley in the Galilee where we graduated from Israel’s Fresh Start incubator in June 2022, our commitment to the region endures. For four years, we have worked with local industry leaders, developing a long-term vision. We are proud to secure funding during these challenging times from key partners, enabling us to reach our audience this year. This demonstrates our commitment to innovation and our goal of improving healthy beverage choices. With this additional funding, we aim to make a significant impact worldwide, one sugar molecule at a time.”
The investment in Blue Tree is among the first significant investments in the Israeli FoodTech sector after a period of weakness starting prior to October 7, but which had become more acute in recent quarters. According to Pitchbook FoodTech review, Q1 2024 saw a mild decrease in VC investment activity in the FoodTech sector worldwide, while in Israel, IVC last report indicated a significant decrease with just $51 million invested in the FoodTech sector across nine deals ‒ a 90% decrease compared to Q1 2022 when $577M was invested in 19 deals. From 2020 to 2023, Israel was second only to the U.S. in FoodTech investing, with $1.9B invested in the three-year period, however, the past year has seen a substantial decrease reflecting the overall decline in foreign investment in Israel.
