US-based alternative seafood start-up Aqua Cultured Foods has announced it is ceasing operations following five years in business.

The company was established in Chicago in 2020 by co-founders Brittany Chibe and Anne Palermo. Its focus was on developing realistic, innovative seafood alternative products, including scallops and tuna, using a proprietary biomass fermentation process and entirely plant-based ingredients.

Despite raising $10 million since its inception and celebrating several milestones in recent years, including securing Generally Recognized as Safe (GRAS) approval in the US, the company announced its closure last week, citing funding challenges.

The news follows the closure of several other meat and seafood alternative start-ups over the past year, including French alt-seafood maker Olala Foods and US-based vegan chicken producer Sundial Foods.

It reflects the challenging economic environment for start-ups in the alternative protein space currently, with businesses facing headwinds due to factors like slowing private investment, high costs associated with production and scale-up, regulatory challenges and struggles to maintain a competitive position in a crowded market.

In a statement shared on LinkedIn, co-founder Chibe wrote: “To everyone who supported Aqua along the way, every single investor, team member, advisor, customer, partner and cheerleader – thank you. This journey tested me, shaped me and taught me what I'm capable of. I'm incredibly proud of what we built together.”