You may have overlooked this tiny organism until now, but 2017 might very well be the year of algae. Don't believe it? It’s already in baking mixes, cookies, milk, nondairy creamers, vegan eggs, salad dressing, ice-cream, smoothies, and protein powders, to name a few. Soon, the extract from spirulina––a form of microalgae––will provide the color for blue M&Ms. Prefer the green ones? It can do that, too.
Algae have been floating around in research and development labs for decades, but, until recently, no one could make it taste good or, really, answer questions of what to do with it. Solazyme, a San Francisco Bay Area company, has been growing algae for well over a decade and is still betting big that its oils and powders will be what food manufacturers reach for when reformulating their products for fewer calories, lower fat, and less cholesterol. The company is so sure that it’s on the right path that it has abandoned a significant portion of its original business––biofuels made from algae––refined its focus to humans, pets, and personal-care products and changed its name to TerraVia.
So, why is this tiny plant—something that’s been in our diets and our fishes’ diets for centuries—finally gaining traction?
"We are seeing massive shifts in the marketplace to plant-based nutrition," says Apu Mody, former president of Mars Food Americas and newly named CEO of TerraVia. Mody, a lifelong vegetarian, is more than happy to see the world shift to a healthier and more sustainable diet and has witnessed firsthand the evolution to cleaner and more sustainable ingredients. "In the last five years we’ve seen real breakthroughs," he says.
Industry experts echo Mody’s words. SPINS, a Chicago-based industry tracker, reports that plant-based foods outpaced the growth of the whole food and beverage industry last year by 3.5% and that it now exceeds $4.9 billion in sales in the U.S. Mintel, the global market research firm, reports that the rapidly growing vegetarian market is a $2.8 billion-a-year industry.
While the health benefits and lab studies are varied, algae wouldn’t be anywhere without its great nutritional profile. Spirulina, for example, is about 65% protein. Beef, by comparison, is about 20% protein (at least protein that your body can functionally use). Conversely, because of the inputs it needs and the space it requires to grow, its environmental footprint is significantly less than a cow. Algae also deliver an impressive amount of vitamin A, vitamin B-12 , B complex, iron, and other essential trace minerals. When processed into oil, algae are an omega-3 powerhouse.
Catharine Arnston, founder of EnergyBits, maker of spirulina and chlorella supplements, says, "In 10 years [algae] is going to be in everything." But there are still disbelievers. Arnston was recently featured on an episode of Shark Tank. The "sharks" ate her product, grimaced, and told her they weren’t ready to invest. Arnston recommends you swallow her supplements, but when I munched on one of the tablets, I made a face too. (Imagine a spoonful of dried kale, and then imagine an aftertaste that is worse.)
The path to bring algae to the supermarket is paved with research that has attempted to elevate algae, and failed. The Carnegie Institution of Washington collaborated on pilot plants in the early '50s that could grow chlorella––another form of microalgae––at optimal levels for food production. They described the taste as a "vegetable-like flavor, resembling that of raw lima beans or raw pumpkin." The institute scrapped the idea as too involved and expensive despite a "need for additional sources of high-protein food, especially in overpopulated areas, that serious effort in tracking down every promising lead is certainly warranted."
Even NASA couldn’t get algae to work. The space agency contracted food scientist Marcus Karel to investigate how it might include algae in its food supply. At the time, the strains available were deemed too strongly flavored and nutritionally unbalanced. In 1998, NASA tried again, but the researchers struggled with how to turn algae into food that a space crew might actually eat over a long period of time. While it’s been successful at growing lettuce in space, NASA is slowly inching its way toward using cyanobacteria to support a manned base on Mars in a project dubbed CyBLiSS. The UN also supports growing algae to feed our soaring populations and stated that spirulina should be used to fight hunger and nutrition problems and urged the world to "mainstream" the organism to supply the "daily nutritional requirements of humankind."
Money is being poured into algae from every country and dozens of companies are betting on it to deliver. Owned since the seventies by DIC, a Japanese company, Earthrise Nutritionals recently announced plans to expand its central California plant in order to ramp up production of Linablue, a blue food-coloring extract derived from spirulina and the first of its kind to win FDA approval. (It’s what M&Ms is using.) Earthrise claims to have the largest outdoor algae farm in the world, but its giant 5,000-square-meter ponds are open to the air and thus upon weather to function. This is both good and bad: Algae need sun but they need to be protected in order for nutrients like carbon dioxide to remain high enough to promote maximum growth. They also need to be grown far from pollutants, which means far away from big cities.
Earthrise may have the lock on using algae for food coloring and supplements, but TerraVia has moved perhaps the furthest toward monetizing the ingredient from a food formulation standpoint. The company has spent years choosing the right strains of algae to grow, engineering it to remove the plant flavor and developing ways to grow it so that it’s no longer green. The algal powder now comes in two colors: yellow or beige. At its small facility in Peoria, Illinois (in a former Pabst Blue Ribbon factory), TerraVia produces its lipid and protein powders, but the bulk of its production comes from a large plant built beside a sugar mill in Brazil.
Unlike Earthrise, which uses sunlight to produce growth, TerraVia grows its algae in the dark inside large fermentation tanks. Without sunlight, the algae need nutrients to grow and TerraVia has tried several different sources of plant-based cellulose: switch grass, sorghum, wood pulp, and good old-fashioned city waste, but for now it’s using cane sugar from the mill next door. The Brazil plant isn’t at capacity yet, but when it is, it can produce 100,000 metric tons of food-grade oil annually. In South America, Unilever is already using TerraVia’s algal oil in place of palm oil in its personal-care products. Besides being bad for you, harvesting palm oil destroys large swaths of tropical forests that are home to endangered animals and so is being targeted by both nutrition advocates and environmentalists; TerraVia is hoping to be the company that replaces it.
Creating an entirely new manufacturing process is complicated, and TerraVia has yet to turn a profit, racking up tens of millions of debt annually. The stock price is hovering in the one-dollar range. It has also had legal battles, notably the sudden end to a short-lived partnership with Roquette, a French algae maker. The goal was to build a third algae plant, but the relationship ended due to "divergent" views. TerraVia was also hit with bad press this past October when Soylent meal-replacement shakes and bars, which used TerraVia aglae, caused many of its customers to get violently ill. At a loss for which of its more than 40 ingredients was the culprit for reported digestive issues, Soylent pointed the finger at TerraVia algae. In an attempt to distance itself from further damaging news, TerraVia put out a press release stating it will no longer supply ingredients to Soylent. (Soylent declined to comment for this story.)
But for other partners, algae is working. Enjoy Life Foods, maker of allergy-friendly foods including vegan and gluten-free baking mixes, began using TerraVia’s algal powder because it was looking for a sustainable, plant-based protein source that wasn’t rice or soy. It took a mind shift for the company to embrace it, says Joel Warady, Enjoy Life’s chief sales and marketing officer. "The initial reaction was, ‘Who would want algae in our pancakes?’" Enjoy Life also embraced algae because it is allergen-free. As we are now a universally picky population of eaters––vegan, gluten-free, lactose intolerant, celiac––one of the primary reasons to produce with algae is that it’s free of all known dietary allergens.
While TerraVia works almost exclusively on the commercial side, they do produce a home cooking oil called Thrive. "Five years ago consumer perception on algae would have been a question mark. One of the reasons we did Thrive was to get consumer acceptance," says Mody. Thrive sales have tripled quarter over quarter through word of mouth alone, and the company just announced it's been adopted by Bon Appétit Management Company, a food service company that operates more than 650 cafés including the ones at Google.
And algae isn't just a replacement for human cuisine. TerraVia recently began producing AlgaPrimeDHA, an omega-3-rich product for commercial fisheries. Because our oceans are depleted and overfished, fish farms are being forced to feed fewer anchovies—small fish that are high in omega-3s—to their fish. The TerraVia product replaces those nutrients without the need to catch more anchovies. To bring it to market, it partnered with BioMar––a leading supplier in the aquaculture industry. Vidar Gundersen, BioMar’s global sustainability director, says that customers are already harvesting salmon raised solely on AlgaPrimeDHA.
And there’s more to come. Big names (Nestlé, Unilever) are developing algae into pet food and functional drinks, and your favorite appetizer may soon go "green." New Wave Foods, a Bay Area startup committed to sustainable seafood, is crafting shrimp made from algae and will have it on the market this year; and Algama, a well-funded French startup, is working on a mayo spread and a sports drink. In fact, the drinks aisle is a good place to watch for innovation, and that’s where Elliot Roth, founder of Spira, a live-algae drink, is starting. Roth’s vibrant green drink was at first flavorless, a hard-to-achieve win that the company achieved while part of a synthetic biology accelerator in Cork, Ireland. When they tested the drink with consumers, they were confused. It tasted like nothing, but it was dark green, which was unsettling. Now it tastes like watermelon.
Creating algae-based products for fickle and unadventurous shoppers is complicated, but the now booming algae industry is confidant it can succeed. "It won’t become mainstream until we figure out the flavor, but I see [algae] as a staple crop like kale was in the early 2000s," says Roth. Now a commonplace ingredient found everywhere, kale can’t hold a candle to the potential of algae as a crop, an ingredient, and a business.
Larissa Zimberoff has written for Forbes, Mashable, Lucky Peach, and many other publications.