HELENE BRIAND: hi ⁓ My name Hélène, Hélène Briand. I'm the co-founder at Verlet. So we are a French food biotechnology company based in Lyon in France. My role at the company is a co-founder but also a chief innovation and commercial officer. And ⁓ we are aiming developing the generation of whey proteins for the food industry. So. I'm really pleased and quite fortunate to announce my new fundraising of $38 ⁓ million led by Alvin and followed by ⁓ Sophie Novas, Sparkfood, CapTech and VPI and Fond de Futur. So this fundraising will be really important for us to be commercial and become commercial in the US ⁓ to prepare our industrial scale up.

Alex Shandrovsky: Amazing. Well, I think everybody who saw that they were just jumping for joy. So want to see big investments, big bets in novel technology, real deep tech coming to the market. So we're so excited for you and congratulations on I had a lot of questions that people sent over ⁓ in preparation for So we're going to just jump in right in there. How did you ⁓ the lead investor the round? ⁓

HELENE BRIAND: Pleasure. How did we meet them? We knew them and thanks to our previous investors as well. So it's good because we got a good introduction from our historical investors. And actually Alvin, we knew them since the seed round and we have constantly kept a relationship explaining where we are, what milestone we aim to reach next year and the next year. And this is how we met and we constantly maintain the relationship.

Alex Shandrovsky: Amazing and just to clarify, were they investor in the previous round as well or this is the first time they came in?

HELENE BRIAND: is the first time they came in.

Alex Shandrovsky: Okay, so I think there's already something we can learn here, right? Because you said you kept in touch with an investor for a span of a year, two years without them writing a check, right? I'm thinking like a founder, gosh, like, that's what I'm going to do later. They're not relevant, they've passed. Why do I need to keep updating them when honestly they're not relevant for another 16, 24 months? It sounds like you were actually pretty active in maintaining that relationship.

HELENE BRIAND: Mm-hmm. Yes, think it's our strength. Maintaining the relationship is ⁓ important to create trust also with investors. It's not only reaching them when you need, but also keep them posted. It's kind of a win-win. ⁓ also get... them inform about the market, the situation of precision fermentation, for example. And there is a momentum, of course, but also we are showing them that we are able to promise milestones, deliver milestones, execute it. And even sometimes if we push further to be over the milestones, so we get more than what we promised. And this is a graal, I think, for investors because they get more confidence and work capability to execute fast.

Alex Shandrovsky: Okay. So, okay. Something you said here, you said we promise a milestone when they execute the milestone. You know, think FoodTech has been famous for delaying timelines, right? Like, you know, we're always pushing off execution, right? And selling more stories. It sounds to me that your team actually put in place a plan that the scientific team could actually execute on and deliver. And yet if I looked at your seed,

HELENE BRIAND: Mm-hmm. Mm-hmm. Mm-hmm.

Alex Shandrovsky: Deck right the erase down with the milestones. Did you actually hit on time your scientific milestones?

HELENE BRIAND: We eat on time and we have been ⁓ overachieving it. And this has made the difference. Because, for example, FDA regulatory, we got the validation just on time. promised to have a strong IP portfolio and we have been beyond what we promised. And also the market traction has been really good between seed ⁓ and the today.

Alex Shandrovsky: Okay, so let's break down each one those because you're already addressing some of objections I was already thinking about, right? So you guys raised your previous round when?

HELENE BRIAND: For me, October 2023, around that timeline, between summer and October.

Alex Shandrovsky: Okay, and I'm sure there's a bridge or something. Did the bridge happen in between as well or there was a bridge or no bridge? Wow, no bridge guys. I think this is our first guess in a while. was no bridges. Okay, very exciting. So you made a commitment in that 23 and you said, hey, we're going to get to the following milestones by the time we raise our next round. And you actually achieved a no milestone. So with commercial traction.

HELENE BRIAND: No bridge.

Alex Shandrovsky: How do you show commercial traction when you can't a product? How you practically show that to your investors? No, no, there's ⁓ actually real demand for what we're doing. How do you do that before regulatory approval? obviously you had samples probably, right? So samples already ⁓ shared, there was no ⁓ vast not large quantities, right, to commit as volumes. So how did you go about showing your investors that, there's a traction here?

HELENE BRIAND: you Mm-hmm. Yes. You have two types of traction. have the customer-per-set traction and you have the market traction with the market signals. we to also maintain good relationships with our customers, And we also are lucky to good relationships with them to be able to discuss directly with our investors. So it was first of... ⁓ You have two types of traction. have the customer-per-set traction and you have the market traction with the market signals. we tend to also maintain good relationships with our customers, keep them informed, be also on the milestones and what we are able to reach without over-promising, but just giving them visibility. ⁓ And also are lucky to have good relationships with them to be able to discuss directly with our investors. So it was first of... allowing investors to touch the credibility as well on the market so they had direct access. allowing investors to touch the credibility as well on the market so they had direct access. And the second point is more the market has a good signals like people are craving for high protein, there is a very increasing awareness about whey protein and BLG needs, is GLP-1 as well that shifting a bit the consumer habits. ⁓ towards high proteins, more packed proteins, so they need more functional food. So both combined made a good market traction.

Alex Shandrovsky: So those prospective customers got on calls with your investors and vouched for the market. They said, hey, this is actually something we really need. This solution is something we need, right? Like we need more of it. We're not having enough of it. The pricing is a lot of volatility there. So they vouched for the problem in those investor calls. ⁓ that ⁓

HELENE BRIAND: Yes, exactly. Yes, yes, they are giving direct ⁓ feedback on the market.

Alex Shandrovsky: Okay, and were those calls live or did you record these prospect conversations you shared in the video or did they actually get on calls with investors?

HELENE BRIAND: They get on call with investors directly and we are not involved. They get on call with investors directly and we are not involved.

Alex Shandrovsky: Oh, interesting. And what position usually in an organization is the one that's talking to them? Is it procurement? Is it a C-suite? Who is the person that's the champion typically? Is it head of innovation?

HELENE BRIAND: It really depends on how the company is organized and also the size of course. You have different types of size. have companies that are ⁓ so it's often head of innovation for example or linked with marketing division and in smaller size it's a co-founder or commercial more the B2C side.

Alex Shandrovsky: All right, so. So I can hear them coming out there and saying, you know, we're really feeling a constraint in this ingredient. We projected the ingredients actually is going to grow. DLP ones are going to become just more available, know, midsize and poorer countries are going to embrace them. Again, higher growth and protein demand. But how does that translate to them going and saying, Hey, we really need Helene's product. Like we really believe in her team. We're ready to buy her stuff. This is the price. When this is ready, we.

HELENE BRIAND: You

Alex Shandrovsky: We're going to give you because they're not giving you off the agreements, right? They're not going to do that at this point because there's no volumes yet. Or are they actually giving you those numbers and price?

HELENE BRIAND: It depends. It depends ⁓ on the size of the company again and the most important part is really the fact that you are able ⁓ generate to their current portfolio. ⁓ You really... able, thanks to your ingredient, to unlock, for example, packing proteins. I take the typical example of shots. I'm not sure you have heard about shots. It's shot proteins. You can pack 24 grams of proteins in 100 ml. And this is only possible with a highly stable protein in acidic beverage. And this is the... clearly a big innovation that needs precision fermentation to be here. So it's one example. Another example is how do we increase the protein content in existing ingredients that is able to really... increase the protein content ⁓ in a different type of beverage. So it's open, really broad opportunity for the customer and for the food industry that is sometimes a bit blocked by the processing or by the fact that they want to pack more protein or by the stability and the taste as well because we need to guarantee that you increase protein but with good taste.

Alex Shandrovsky: Right, right. And I have to say, yesterday I had a protein shake I was running that I at the store. I also use GLP ones myself, right? So, and my God, it was disgusting. was like, ⁓ can't do this. Must peel an egg and eat an egg, I think. That's probably the way that would give me some beef jerky. So I'm excited, but looking forward to your proteins and your products. I'm sure they could be much more delicious than what I had yesterday. I am, you know, the investor I'm asking, hey, can you give us the price that you're willing to pay for this product, how much volume you need? Are these customers or prospects to do that, are they willing to say, this is the volume I want, this is the price I'm willing to pay for it. If they are able to meet that, like yes, an offtake agreement is totally possible.

HELENE BRIAND: not at the beginning of the relationship with some customer, but when you develop a collaboration with a customer, first you validate the technical feasibility. You ask them where they want to go, what do they want to reach, what are the technical challenges, and it is also thanks to our background in ingredient design to be able to understand those challenges, and this is how we became with our functional ingredients to really meet just their challenge. And after you build the concept of the product, then you can evaluate what will be the market. We do a business case simply like what will be the market, what will be the forecast, how do you see that growth in that market and are the ramp up and how we tend to work together to make the price working.

Alex Shandrovsky: So what you're saying is that you have an applications team as well as part of the company, not simply an ingredient company that gives an ingredient to say Nestle or Danone, and then they apply their ingredient, your ingredient in their applications. You have a team that actually is working actively on applications of your ingredient in different use cases, and then you're showing them, this actually, this is solution that looks like.

HELENE BRIAND: Yes, and clearly it has been the differentiator of Verlet. In 2022-2023, this is how we discovered the importance to functionalize the BLG, is because we realized that we were limited in terms of protein concentration and we have an entire team dedicated to performing application, anticipating the client's needs, challenges, processing. So we have our own laboratory in Lyon where we are able to develop brought different applications from to drink, UHD, bars, and we test all of them and we push further the protein content to see the challenge.

Alex Shandrovsky: Okay. So there would be another side of, you know, other entrepreneurs would say, gosh, you know, you're an ingredient company. You're to put headcount into applications. That's like, you're burning more money. ⁓ you know, you're not going to be able to apply it specifically for an application of each class customer. There's so many different ways. Just wait for Nestle to take your product and the use applications, you know, test applications and their own product lines. Why, ⁓ build one internally? Did you ⁓ when you made that bet three years ago? No, like that's not the

HELENE BRIAND: Mm-hmm.

Alex Shandrovsky: path we're going. We have to be able to do in-house application work. We can't just outsource it to the big corporates.

HELENE BRIAND: really important and ⁓ we do not burn a lot of money ⁓ application ⁓ it's ⁓ helpful because helps us to be focused actually because then we can focus on the challenge and not trying to sell something that doesn't fit the needs of the market. So I think it's worth to invest that money and we are a team of five people. I have that background as well that helps a lot and Yes, we can rely on our future clients to wait and sit, they're telling us what is the problem, but if we come with a better understanding of the challenge, with a solution, we win a lot of time for our focus execution.

Alex Shandrovsky: I really respect that. And think that other startup founders, how lazy corporates truly are. And ⁓ in a sense they really do want you to do a lot of the legwork to prove to them that, and that means that the product doesn't get bogged down, right? ⁓ In the R side, because as soon as you ⁓ include a lot departments, It's just another person you have to prove your value to instead of just going straight to commercials, right? So I love the approach and you said there's five people on the team or you said the whole company is more than five people, correct? 35, okay. So that brings me, you guys raised a total, you raised like 30 million before, correct? Right. And then in your seed, how much do you guys raise in seed? Like 18 or 20?

HELENE BRIAND: Mm-hmm. ⁓ yeah, we are 35. About, yes, a bit less, yeah. 18

Alex Shandrovsky: 18. How did you survive for so long with so little money?

HELENE BRIAND: We are super conscious. ⁓

Alex Shandrovsky: No, but I'm like $18 million, like I just do it. $18 million, have 35 people, you guys are living in a high net worth country. Leone is beautiful. I've been there, gorgeous place. You're like, that's not a lot of money. That's not a lot of How did you do that?

HELENE BRIAND: Now that's not a lot of money, it's true. I mean, if we look at what has been done in the past, how did we do? think if I have one word to use, it's focus. We have been always focused on what is really important for our ingredients to be purchased. And really focused on ⁓ the design, the bio process, but the ingredient design and... we decided to not expand to any other protein for example. We focused only on BAG that use the same process and after we applied our functionalization. So... It helps a lot the team to really be concentrated on how we improve the efficacy of the process and how we differentiate ourselves with our offer. So the two teams are working really well together, the bio process and the food science. also the fact that we were managing the team ⁓ early in the process of Verlet in the project management helped a lot to streamline as the execution. ⁓

Alex Shandrovsky: Wow. Do you guys use a certain system for project management? ⁓ in Valley, they use this thing called EOS system. Is there a system that you guys use for project management that found would be helpful for the scientific ⁓ team or it's something that you've built in-house?

HELENE BRIAND: we have simply hired two project managers dedicated to execution and project management. This is helping a lot.

Alex Shandrovsky: Yeah. Yeah. And their whole job is to make sure that other teams are staying on target to milestones, right? Yeah. And that they're not scientists. They're not working in the lab. They're not. They're their whole job is to manage.

HELENE BRIAND: Yes, exactly. They have a background, yeah. They have a background of science background, but they're not working in the lab. They're just here to manage the milestone and building the mitigation plan.

Alex Shandrovsky: Okay. Again, just so such a breast of fresh air, because some founders will say, Hey, that's again, I should put them to headcount of more people, more bodies in the lab. But you say, look, we need a manager that can hit milestones when we promised them, right. And that's where the budget is going to go. Anything we need to know about public funding, you know, obviously we'll put BPI aside for a second, but anything that you got, that you didn't raise through traditional VC cash, that you raised through grants that we should be aware of.

HELENE BRIAND: You He

Alex Shandrovsky: of grants or &D budgets that were covered by the government that were significant, because again, ⁓ million is so little money.

HELENE BRIAND: it is always included in our fundraising. We it the non-dilutive. Often it's one third of what we have raised ⁓ in the amount. And it's true that France government is highly supportive through BPI. And it's the ⁓ even though it's public funds, they are not wasting money. They want to make sure you meet milestones. So you need to be really good at project management because it's all about work back. you need to deliver and demonstrate and then it's unlocking some trenches of subvention.

Alex Shandrovsky: Okay, so let's talk about BPI because there are some of my three favorite letters in the English dictionary is BPI because they've put a lot of cash into our industry. Some of it, you I'm not going to, you if you look at white insect, you know, take a look at that place. You might want to look in there and see, maybe that was in the best places to put them, but they do bets, right? They take significant bets. My understanding is about BPI makes bets about growing headcount in France. It's about developing France. But your raise right now is about taking your technology to the United States and commercializing in the United States. You're moving from, you're not building a factory, you're using CDMO. So why would a government fund of Paris, sorry, a French government fund, commercialization for the United States?

HELENE BRIAND: Mm-hmm. So, are also aware that the we have a revenue, the better, the healthier situation it is. And ⁓ they want to pursue their investment in a competitiveness of France ⁓ to able to have knowledge, ⁓ IP and scientific I would say, background and... And why they're supporting us is because it's needed to support the entire industry of the protein, of course. also because we are aiming for EFSA, we are aiming for Europe as well. It's just like, we are just pragmatic. We to earn money by ourselves ⁓ and only depends on VC, so it's really important that they accept to earn from... from US market and then willing to more investing innovation in France, hire more people in France and then to expand the European markets. So I think it's great as they accept that. Otherwise, if we, because FSI is quite long, you it's two to three years. So if we wait for that, we will need much more money than 38 million.

Alex Shandrovsky: understood. I'm glad they made that decision ⁓ that thinking forward like that. lot of government funds are, unless every dollar is spent locally, they're not going to put the dollar in. Which brings up this ⁓ maybe a little question, but I've heard this from other founders, but since you and I are now close friends, so we can ⁓ ask controversial questions. have heard from other French founders it's extremely difficult to foreign funds as a French company. because of tax implications about exit. ⁓ that rumored true? Is that just some fake news that's out there around foreign ⁓ are not comfortable in investing in HQ France companies because of some tax implications on upon exits? ⁓ is your company not registered in France? It's the United States HQ. ⁓

HELENE BRIAND: Mm-hmm. Mm-hmm. I think it's not only about tax, but first it really depends on your stage of development and you have been able to grow. And it also depends on where do you commercialize. The day we start to commercialize Oversea and you generate some revenue Oversea, the story is slightly different, right? I'm not sure it's not only about tax, but how you have been able to prove your traction within the market they are willing to invest in. And that be the next stage as well for us. Here we are, I would say also... ⁓ grateful to have some French investors, we not only we have Sparkfood for example, which is from Portugal. Okay, it's Europe it's already bringing a bit of international in our VC ⁓ ⁓ also ⁓ fact that maybe French Sometimes when you are French company, you are free French. You see what I mean is like not internationalized enough and with Stefan we decided since day one to have an international team. So today more than half of our team is coming from overseas, from South America, from I cannot yeah everywhere, really everywhere.

Alex Shandrovsky: ⁓ So is that because your CDMO is not French based? Is that ⁓ processing engineer there or you have ⁓ &D teams ⁓ of France?

HELENE BRIAND: No. No, no, everyone is centralized in Lyon. Lyon is very attractive and it was really a wish from Stefan and I to have an international team. It's clearly important multicultural way working, complementarity.

Alex Shandrovsky: Uh-huh.

HELENE BRIAND: And because I was working in Malaysia before, I used to work in that environment and I really wanted to reproduce that in France, which is a challenge actually, because it's not easy neither to have an international team and attract them to be in Lyon, but when they are in, they really love it.

Alex Shandrovsky: They're not going anywhere. They're sticking. They're sticking by there. a ⁓ one. I you are one of the first, if not the first, got ⁓ functional way approval, question asked, in the United States. And that's a huge milestone. Take us through your regulatory journey. When did it start in the United States? How much you guys spend on consultants to get there? You were you surprised how quickly it went? Did it take longer than you expected? If I'm a European founder and I'm like, I'm going to go to the United States, given those to this administration, what are we seeing right now from timelines, amounts to be paid, and how responsive the FDA is to companies applying?

HELENE BRIAND: So you are right. First, we have been the first one filing functional BLG. So because we apply the functionalization on our BLG, it's still a BLG protein, but it has another attribute like stability. started the process early ⁓ 2025. 2025. And end of 2024, we have been able to leverage the self-grace end of 2024, which was still the case. You could really have a first feedback, which is really relevant for from the peers. ⁓ as soon as we got the self-grace, we have been able to notify FDA with our complete dossier in January. And it took us about nine 10 months to get it from the no question letter. It's really on time, delay at all. And I think I'm quite thankful to Atova, which is our consulting firm, which is really helping me. It's Anna Lester that I know for long time and she has been really making a great job.

Alex Shandrovsky: And was she full time in your team or she is a consultant? Wow. And if you'd give a range of...

HELENE BRIAND: She is a consultant.

Alex Shandrovsky: You know, we had one, the CFPROCIE brewery said, you know, it's about 1.25 million in all of the consulting work that was done. And to get through EFSA, consulting or anything regulatory, that was about 1.25. Approximately, you know, all the work that was done to get to regulatory approval in the United States, if I'm budgeting, is there a certain amount you could recommend? This is kind of the budget you're looking at.

HELENE BRIAND: you Mm-hmm. Yeah, big range. I can give you a big range because it's also related to the analytics and about 20 plus 30 so 50, 50,000.

Alex Shandrovsky: You got it for free basically. It was done for free.

HELENE BRIAND: No, it's not free. Just like, ⁓ mean, we were well prepared. We to make sure we make it right also first. So, yeah, we have been quite careful about what kind of analysis we perform, how we do it, step by step.

Alex Shandrovsky: them in. What would you say was the biggest objection you had to overcome in this round? Like what was the thing that they were just coming after you like again and again and again and again? And how did you overcome the objection ultimately?

HELENE BRIAND: Hmm. we didn't get that many objections, but one, I remember one, is really the that some investors stopped to invest into food tech. Like they said that, sorry, we do not no longer invest in food tech. And this is really hard to overcome because it's the rule of their new investment fund. So...

Alex Shandrovsky: huh.

HELENE BRIAND: hard to say how I overcome it reaching someone else and really rely on our network. You to have a very strong pipeline. ⁓ You to have a capability to also showing that food tech is not only what they think about food tech, it's also... a market that is existing and showing the traction of the protein market today, the good signals of the GLP-1 and the needs for functional ingredients. So is all that we put in place to really show that it is not ⁓ only a promise, it's happening now. And this is making the difference.

Alex Shandrovsky: But the thesis of your lead investor, did have a agri-food techs thesis or was a generalist?

HELENE BRIAND: is a generalist.

Alex Shandrovsky: And did they make bets in AgriFoodTech before?

HELENE BRIAND: They are starting.

Alex Shandrovsky: So you basically brought new cash into our industry, which is congratulations. I feel like we should send presents because the thing is there's no more tourists, like all the tourists left. Now, every time I ask people, is there a thesis, a journalist thesis, and they say, you know what, they are journalists, and they put money, I say, thank you. We need to send you more gifts to you because that's brings more confidence for journalists to take bets here.

HELENE BRIAND: Hey. But it's also momentum. It depends and I'm not in their shoes but when they decide to go into foot-take it's for several reasons when they decide they know for what why they are going there.

Alex Shandrovsky: So was there some sort of incentive that they had that was beyond just financial returns? the fund have a mission? It's not a non-for-profit, right? It's not a government fund. ⁓

HELENE BRIAND: No. no, it's a, it's it's a VC,

Alex Shandrovsky: So, and then we're going to go a little more controversial here. Let's see, let's see if this where, where, it is so far in line, you've been amazing. So I have a position that or seeing a position that from my mentors, they say, look, you know, when you're projecting exits, man, if you can get a half a billion dollar exit, right. You know, as as a food tech company, you are like incredible, right? Half a billion, $500 million exit. That's like the, you know, Wow, holy grail level. You guys raised altogether like almost 80 million or so, something like that, right? Whatever, altogether.

HELENE BRIAND: No less, less. ⁓ I don't have all figures in mind. Stephanie is better than me on that. You can cut that. Fatih.

Alex Shandrovsky: 70. But you raised, you know, like, did you, do you have a projection of when you get bought? Cause let's assume you're to get bought by someone not go public. Cause that's again, the public markets are really, really tough. Like, is there a number of what that looks like that gives them the returns they need to, get their fund back or like the four X five X on the fund? Like that number of when you're going to exit is already in that, in, that spreadsheet or you guys don't have that number.

HELENE BRIAND: I'm sure they have, but they have not shared with us.

Alex Shandrovsky: But you guys, when you were showing your projections, did you have a number in the projections of, we think we're gonna be at, we're gonna get about 2X revenue, 3X top line revenue, we need to get $250 million, this is what we can do. Or you feel like at this stage, nobody's even asking you those questions.

HELENE BRIAND: They are asking, but we do not go into that detail. With such promise.

Alex Shandrovsky: Okay. Fascinating. Why don't you have a chart that says we hit this much revenue and it's going to require this much volume, we could get bought for this much. Is why isn't that part of your data room?

HELENE BRIAND: I cannot answer everything here, but kind of part of it because it's highly related to the revenue and the capability to deliver in terms of and so on. The thing that it's really hard to anticipate all that with precision. And you know, as soon as you put a figure, it's written right. So... ⁓ it's even more important to show the market evolution and the promise of the market and also the technology because it's not only about selling the volume and the revenue but it's all about the IP that you build that has a lot of value as well for the company, for the food industry that bring in. So I have tendency to say that I don't like to share those kind of figures even though they can make their calculations in their head, they are very good at it.

Alex Shandrovsky: Yeah, I think that this is one of the reasons I love interviewing also European founders and not so much the American ones sometimes, because you know the Americans, they already have PowerPoint that shows like, it's going to be billion dollar revenue in three, four years. Like, that's a very classic move, right? this notion of saying, We're just going to focus on unit economics, on the science, making sure that the market is big. We all know that if we can win ⁓ price and value, ⁓ think we'll be all right. The can definitely carry us through. It's not like there's going to be a lack of desire for a great functioning weight protein and it's price competitive as well.

HELENE BRIAND: The key for the company is to show that we are able to generate revenue, to have an LC business plan. think nowadays it's really important to show that you can generate revenue, growth, and also some margin very quick. And it is all about execution and how you can deliver. healthy company in a huge growing market and maybe the anyway is not the right one. I don't know but we had examples for now it's working and so far it has been working.

Alex Shandrovsky: Yeah, it sounds... execution is definitely working and of the things that you guys are doing is scaling up through CDMOs. There other players like ⁓ protein brewery, can raise a significant amount of they have their own plant, their own factory. matter foods from Denmark building their own place, right? So go through CDMO? Why was a decision made? And how do you find a CDMO partner that you trust? ⁓ start with Aaron and then have quite a few follow-ups on that discussion.

HELENE BRIAND: Mm-hmm. Yeah, sure, Now the strategy has always been to leverage CMO. I I was in the insect farming before. I was working in Malaysia for that. And I realized how hard is it when you are in your company to handle your R &D, your ingredient design. your team to also work together and on top of it manage with ⁓ equipment and so on. So we are fortunate to have CMO with capacity with fermentation tanks that fits our technology so we should leverage it and we are also fortunate that ⁓ of them are downstream so you see what it is a filtration system ⁓ are already installed fitting our process. So we ⁓ leveraging CMO much as we can until we fully de-risk the at industrial scale, until we commercialize, until we get revenue and our own revenue, and then we are equipped, organized staff enough to invest in our CAPEX. And this has been our strategy of de-risking this phase because managing everything at the same time is really difficult. again, it's not the case for all technologies. Sometimes it's not possible, but here it's okay. So we leverage it as much as we can and how we select it. have the location, be to your market, be close you to have a relationship and a presence on site. The equipment, is it fitting your process or not? also the agility. would say the agility to understand our pace ⁓ of course, know startups are. ⁓ Everything for yesterday. So ⁓ no, it's really important that needs to match all that. And the as well as how you build the relationship, the trust, the confidence, you show him as well. It's really important.

Alex Shandrovsky: Amazing, Without disclosing the name of the partner, is this CDMO or CMO in the United States?

HELENE BRIAND: in North America in general.

Alex Shandrovsky: No, I'm sorry. Okay. Why was that important? And the reason I ask is there's arguments to be made. Gosh, my gosh, you know, those labor costs are really high. compared to something you could do in China or you could do in India, Whey protein, it's not a seemingly it's not a high value ingredient. the margins must be really low. There are CMOs eating into your margins. Like how are you ever going to be able to compete on price with what's currently in the market? The only way can do this, you have to produce it in China or India. How could you produce it in North America?

HELENE BRIAND: Actually, we are no longer into a bulk market. That why also we are ⁓ working functionalized BLG is really to serve at the at least, ⁓ really a data. ⁓ able to understand the needs of having pure beta-lactoglobulin. today, a lot of customers are really caring about how our ingredient is able to have pricing visibility versus the milk ⁓ proteins that are purified from milk that are highly dependent to the volatility. ⁓ And being to give visibility on that is really important. So... I don't want to say that it is cheap with low margin. We can get a decent margin with our ingredients. And also we are going into a premium market at the beginning, which is normal penetrate the needs, ⁓ address the specific needs with claims, nutritional advantage and benefits that the consumer and the industrial is able to understand. And further... ⁓ It's more on us, on our technology to also improve the market. But you can make two times trying CMO all around the world. Yes, it's about price, but it is not our first criteria.

Alex Shandrovsky: Hmm. And because strategically you're also positioning yourself as a premium, highly functional ingredient that the market is willing to pay a premium for because of the unique value it brings to their product lines, right? And if, can you give us a range of, if I was looking at whey protein, traditional whey protein on the market, what the costs compared to, you have to disclose your pricing, but a high functional whey protein, like how big of a gap is that?

HELENE BRIAND: Yes. I can tell you is really really small the gap. Because yes, yes. You know there is a really large demand for high protein today and the way and especially BLG is really gaining awareness into consumer and They are looking for no longer at whey, you see the sport whey package. They are looking for amino acids, leucine content. And all that you are able to pack into BLG is nothing compared to a bulky whey, for example, that you can deliver. And this is creating a lot of value because you can then add more other ingredients such as fibers because you have more space into the recipe, but same amount of proteins or even more quality proteins. is gaining ⁓ high interest.

Alex Shandrovsky: I think everyone who's this podcast is going through their fridge and or their pantry is throwing out their protein, big box, you know. it's all gone now. It's all it's all gone. ⁓ The.

HELENE BRIAND: You

Alex Shandrovsky: So one of my dear friends I love very much, Stefan from Vivici, ⁓ another wonderful guest in the podcast, doing lactoferrin, right? So I thought you're going to tell me we're going lactoferrin. Why are we not doing lactoferrin?

HELENE BRIAND: We focus. No. No, no, it's true and it is great and I'm super happy for them. They are doing a great job and I'm really happy to having them as a competitor. No, no, it's...

Alex Shandrovsky: That's it.

HELENE BRIAND: We are not able to do everything. We have always been able to diversify our portfolio with BLG but functionalize in a different way, gel, microparticulated. So this is already a lot of work that I can address a lot of markets. So we decided to reflect on it. But for now, we focus on our commercial path in the US for this year.

Alex Shandrovsky: Okay, I think that's an excellent and excellent answer. And again, I go back to the beginning of the interview, man, you've said you hit milestones, you hit them. that's admirable in both commercially and from a scientific team, hitting those milestones will give a lot of faith. defocusing, yeah, sounds like the focus is the key to the whole company.

HELENE BRIAND: it's really thanks to my team too. They have been really good at executing and organizing themselves. mean, even during the fundraising, it didn't change the of the execution of the milestone, even during the fundraising period, which is a clear demonstration of our organization and I'm quite thankful ⁓ for work that they deliver for us. ⁓

Alex Shandrovsky: Is there anything else about the fundraising process? Any last thoughts? said, look Alex, you know, this really was really unique about what we did or we're really proud of this. Or maybe, hey, I wish I knew this when I start, when I, or like, gosh, that was a, well, that held us back about four months. Just having this thing not taking care of all this NDA, whatever it is, or the legal. Anything that the final thoughts before we close up that you'll say, look, this is really important.

HELENE BRIAND: Mm-hmm Mm-hmm. No, I think one thing that was important is that... Even within the period of fundraising, we have been constantly been able to discuss with our investors and showing them that we have able to deliver even during fundraising some milestones ⁓ ⁓ didn't change anything from our strategy and constantly the market good signals about traction for proteins. So nothing to add on that. It was one of my experience of fundraising actually.

Alex Shandrovsky: Gosh, well, I want to congratulate you on achieving that and really lifting up the whole industry through this race. How can we thank you? I mean, you've been so generous to us, very clear. What can we do for you in the next six to 12 months that you're focused on? How can we support you?

HELENE BRIAND: Thank you very much. First of all, you already support me by interviewing me today. ⁓ thank you for your time ⁓ reaching us. ⁓ think it's really important to, if you can, ⁓ support in the next month when we will be commercializing and supporting ⁓ the industry, showing that we are... I'm not talking about Verlet only, but showing that... We are willing to do really good job and we want to be a good ingredient provider. And not only us, it's all about our field and showing that we are a serious company and we are very focused on deliverables and to meet really the market challenge.

Alex Shandrovsky: So when will that product be available for consumers to buy and how? mean, for the summer. And this will be something that a consumer will be able to buy through online or it would be retail just to get some expectations on ⁓ how.

HELENE BRIAND: we aim in for this summer. through our customers and what they want to use as a channel for distribution, but I would say both of them.

Alex Shandrovsky: Well, we're definitely excited. I definitely know I'm making space in my closet for your products. So I'll probably have to pack my whole suitcase and bring it back to Israel on my trip to the United States. So congratulations, then again, we're really rooting for your success.

HELENE BRIAND: You Thank you so much, Alex. I really enjoyed it.