Israeli startup DouxMatok, which is developing a method of reducing sugar consumption, recently raised $8.1 million from Pitango Venture Capital. Eran Baniel cofounded DouxMatok with his father, Prof. Avraham Baniel, on the basis of the latter's invention, the same pattern as in the founding of the Baniels' previous company - clean energy company HCL CleanTech. Prof. Banliel came up with the idea for enhancing the sweetness of sugar 50 years ago when there was a shortage of sugar in Israel. More than four decades later, the idea became a venture with founding of DouxMatok in 2013. The first investors in the company were Gil Horsky and Food Lap Capital.
Pitango managing general partner Ittai Harel, who is managing Pitango's investment in DouxMatok, says, "DouxMatok's method enables sugar to be absorbed by the body's taste mechanism in a new way. The sweet taste can be preserved, while cutting the amount of sugar actually used by 40%.
"From a technological standpoint, the chemical mechanism is similar in its complexity and principles to improved drug delivery mechanisms. From the standpoint of its contribution to health, the product is first of all a consumer product appealing to a multi-billion market, but it is also likely to help prevent diabetes and save the health system billions. As an investor in the health sector, I usually treat those who are already ill, but many diseases are the result of lifestyle and nutrition, and this is the way to address them - through prevention."
"Globes": The artificial sweeteners market is already well-established and rather competitive.
Harel: "The existing products don't really replace sugar for everybody. Sugar consumers want a product that will preserve both the taste and the texture, without putting questionable materials into the body. In this context, all the existing solutions have in fact failed. DouxMatok has already tested its improved sugar in taste tests, and found that it does indeed replace sugar for the tasters. This product can be included in all types of food in which sugar is used. It will take about a year before the product can be produced commercially and marketing can begin."
Will your customers be food companies, or will the company have its own brand that will be sold to the end consumer?
"At least in the initial stages, the product will be marketed in cooperation with food companies. We have already met a number of food companies, including one that told us that this product is a game changer. We're not ruling out selling a DouxMatok sweetener, or using the same technology to enhance flavors of other products, such as salt, vanilla, or anything else."
Will Pitango continue investing in the food industry?
"We have definitely marked this sector as important and interesting."
DouxMatok
Founded: 2013
Field of business: sweeter sugar
Employees: 11 in Petah Tikva
CEO: Eran Baniel
Capital raised: $8.1 million
Investors: Pitango and others
Published by Globes [online], Israel Business News - www.globes-online.com - on October 9, 2017
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