Insect farming startup Ynsect has secured €160 million (roughly $175 million), but it has also laid off about 70 employees, or 20% of its workforce, in a bid to tackle rising costs.
The Paris-based company plans to use the funds to shift away from breeding insects for animal feed to target more lucrative markets such as pet food and ingredients. Ynsect said the pivot will reduce rising energy and materials costs.
The startup will close its production facility in the Netherlands, which it acquired with the purchase of mealworm ingredients company Protifarm in 2021, Bloomberg reported.
European agtech startups have struggled to raise capital amid the downturn in venture dealmaking. In 2022, VC deal count in agtech dropped 24.2% year-over-year, according to PitchBook data. So far this year, 42 deals have been completed worth a total €340.4 million—almost half of that deal value comes from Ynsect’s latest round.