French startup, Ÿnsect, is looking to accelerate its path to profitability. The company, which produces insects for pet and human food, has reduced its headcount by 70, roughly 20% of its workforce while raising €160m. Existing investors include Astanor Ventures and BPIFrance. The startup declined to discuss the impact of the new funding on its valuation, previously estimated at around $650 million.
The company's plan to reach profitability faster involves closing production facilities in the Netherlands, resulting in 35 job losses. In addition, the company will be cutting 38 jobs at the company's Paris headquarters.
Besides closing its Dutch production facility, the company plans to build smaller, less software-intensive facilities and alter its products.
Furthermore, the company will concentrate on insects for human consumption, pet food, and plant food rather than producing insects for animal feed, a low-margin product. Two new insects were approved for human consumption by the European Union in March this year, making a total of four now available for consumption.
The revised plan includes collaborating with several joint ventures and partnerships worldwide and keeping the two remaining farms in France and the US open. The future facilities will be significantly smaller, with fewer software-intensive features. As a result, job cuts in the Paris headquarters for roles such as engineering, HR, and finance were made.
Even with the cuts, the revised strategy does include hiring in the next year - around 35 to 40 positions, mainly engineering roles outside of Europe.
Despite the cooling funding market, Ÿnsect is among a cohort of European startups seeking traction. Together with the company's last $372m Series C round in 2021, the company is now the best-funded insect startup in Europe, surpassing Innovafeed, which has raised $485 million in total.