Yesterday, according to report, Estonian biotechnology company ÄIO has secured €1 million in government funding to accelerate the development of sustainable, yeast-derived alternatives to traditional oils used in cosmetics production.
The funding, granted through Estonia’s Applied Research Programme (RUP) and organised by the Estonian Business and Innovation Agency (EIS), will support ÄIO’s mission to replace unsustainable oils—such as palm oil—with bio-based alternatives created using precision fermentation. This process converts industrial side streams, or waste by-products from factories, into nutrient-rich oils and fats.
According to ÄIO, its method uses 97% less land and 90% less water than conventional palm oil production, offering a promising solution to the environmental toll of traditional ingredient sourcing.
“This grant represents more than funding—it is validation from the Estonian government that our technology can fundamentally reshape how cosmetics ingredients are produced,” said Nemailla Bonturi, co-founder and CEO of ÄIO. “We are now ready to show we can scale that impact on the international stage, bringing smarter, more sustainable ingredient alternatives to an industry that touches the everyday lives of all of us.”
Ene Viiard, R&D Expert at RUP, emphasized Estonia’s commitment to scalable innovation: “We actively support the development of Estonian innovations that have clear potential to become globally competitive products with high added value and impact on pressing worldwide challenges. Biotechnology and sustainable biomaterials are among our strategic priorities.”
ÄIO’s grant comes at a time when the beauty industry is doubling down on biotech and fermentation-based innovation. In 2025, Estée Lauder Companies partnered with Serpin Pharma to explore longevity skin care, while L’Oréal Groupe backed Chinese biotech start-up Veminsyn to accelerate ingredient discovery and commercialization. L’Oréal has also invested in Debut, Abolis, and Geno—all focused on developing biotech-based ingredient alternatives to those derived from palm oil and fossil fuels.
