Mekong Capital puts $25m in Vietnam-based insect protein firm Entobel

Vietnam-focused private equity firm Mekong Capital has invested $25 million in biotech company Entobel.

The investment was routed through the $246-million Mekong Enterprise Fund IV (MEF IV) and was part of Entobel’s $30-million funding round, Mekong Capital said in a statement. The remaining $5 million has been invested by local asset manager Dragon Capital.

Entobel produces insect-based ingredients from black soldier flies for various industries such as animal feed, pet food and fertiliser. Currently, the company has three main products, including insect meal, insect oil and organic fertiliser.

Its production facility in Dong Nai province, southern Vietnam, has an annual capacity of 1,000 tonnes of insect meal. The company plans to start operating its next plant by 2023.

Entobel was founded in 2013 by two Belgian entrepreneurs, Gaëtan Crielaard and Alexandre de Caters, who realised Vietnam’s significant and sustainable competitive advantage in the business, thanks to its tropical climate, and abundant sources of feedstock from agriculture activities, F&B production and growing aquaculture market.

Entobel is planning a global expansion of its insect protein technology, having had a “growing blue-chip customer base” and industrial partnerships for R&D activities, the founders said in a joint statement.

Entobel’s technology and products “will reduce the environmental footprint of our global food chain, while making the food value chain safer and more sustainable”, said Sjoerd Zwinkels, Mekong Capital’s deal leader for Entobel.

MEF IV was launched in 2021 as Mekong Capital’s largest fund. It continues to focus on retail, education, restaurants, consumer services, FMCG and healthcare like its predecessor funds.

The vehicle has backed six companies prior to Entobel, including chocolate crafter Marou Chocolate, cosmetic retailer HSV Group, water purifiers manufacturer Mutosi Group, proptech startup Rever, probiotics producer LiveSpo Global and genetic testing company Gene Solutions.

Mekong Capital has raised nearly $527 million in total across four funds in its flagship series and the 2007-vintage Vietnam Azalea Fund, which invests in pre-IPO opportunities.

The firm has completed 42 private equity investments, of which 27 have been fully exited.

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