- InsectBiotech says the insect protein sector’s setbacks highlight which business models work and which do not.
- The startup has raised €7.2m to scale production in Andalusia.
- The company’s first commercial facility is expected to begin operating in Q3 2027.
The insect protein sector has experienced a challenging period in recent years, marked by several high-profile struggles and failures.
Despite this, Spanish startup InsectBiotech recently raised €7.2 million to build a commercial Black Soldier Fly larvae (BSFL) production facility in Andalusia. The first production site is expected to be operational in Q3 2027.
Speaking to AgNavigator, Tobias Webb, co-founder of InsectBiotech, said insect farming companies can succeed by learning from earlier failures.
“The sector’s earlier failures do not invalidate the model itself; they highlight which approaches do and do not work. Our approach is built around low-cost feedstock, low-OpEx production, modular scale-up, and a product that can compete commercially on price and reliability.”
Webb argued that commercially viable BSF production depends on using genuine agricultural waste streams as feedstock, locating low-cost production facilities close to raw material sources, scaling through modular expansion, and balancing automation with skilled labour.
“The aim is to deliver products that compete on cost, not sustainability alone,” he said.
Scaling up
The latest investment supports the construction of a new facility in Andalusia capable of processing up to 7,500 tonnes of agricultural by-products annually.
The Andalusia site will be located close to major agricultural production areas, allowing the company to source raw materials locally while contributing to rural economic development through job creation and partnerships with farmers and processors.
“We are entering a new phase where the focus is on execution at scale. Our objective is to deliver competitive, market-ready products while demonstrating that agricultural waste can be a valuable resource in building more sustainable food systems,” said Ignacio Gavilán, CEO and co-founder of InsectBiotech.The round includes participation from Arcano Partners through the Impact Andalusía Innovation fund, alongside a group of international investors.
“The investors were convinced by the team and our track record, the patented pretreatment process, and our deliberate approach of spending two years researching and experimenting on feed and climate optimization before scaling,” said Webb.
InsectBiotech’s products are aimed at aquaculture, poultry, swine and pet food markets, while its insect oil is targeted at biodiesel producers and its frass fertiliser product, ResiliGrow, is being positioned for vineyards and berry production.
Webb said the company has already secured close to a dozen letters of intent from prospective customers.
Cost-efficient approach
In 2025, Webb told AgNavigator that the company had “cracked the code” on how to run a cost-efficient and profitable insect protein operation.
The company says its facilities in Andalusia will use solar energy to reduce energy costs, while abundant olive oil waste will help keep feed costs low.
“We purchase it directly from olive processing production sites under long-term supply agreements, which gives us security of supply and predictable pricing. Some complementary agricultural by-products may in certain cases come with very low cost or even a gate fee, but our business model does not rely on being paid to accept waste,” said Webb.
The olive pomace is then pre-treated before being fed to the larvae.
According to the firm, the proprietary pre-treatment improves the digestibility and nutritional value of olive pomace before it is fed to larvae.
“The process uses cost-effective inputs and remains highly economical, allowing feed costs to be as low as one-quarter of conventional wheat-based formulations,” said Webb.
The company supplements olive pomace with small quantities of additional nutrients, but Webb said non-pomace ingredients represent only a single-digit percentage of the overall feed formulation.
“Our main goal is to maximise the inclusion of olive pomace while supplementing only the key limiting nutrients, such as amino acids, needed to achieve a nutritionally balanced feed and optimal larval performance.”
