New Delhi, January 11, 2019: After studying chemical and biological engineering at Tufts University, Ryan Pandya took a safe job at MassBiologics, a Boston-based biotech company. It was partly to please his mother and father. “My parents are first-generation immigrants from India,” he says. “I’m second-generation, and there’s a focus on making sure that you study something that is sure to have a job and is sure to be lucrative.” But while toiling in MassBiologics’ lab producing the proteins that form antibodies, he came to a realization.
He was creating proteins genetically identical to animal proteins. Why not find a commercial use for those artificial but identical proteins? Pandya, who as a struggling vegan didn’t want to consume any animal products, found it difficult to find appetizing dairy-free dairy products. Most were made from soy or almond milk. (“They just taste plastic-y,” he says.) But using those artificial proteins, he could create yogurt, cheese, milk—any dairy product, really—that would taste exactly like the real thing. And those products would represent a more sustainable food source.
“We’re finally at a point where we can make stable proteins and stable nutrition for the world,” says Pandya, who’s 27.
After working at MassBiologics less than a year, Pandya quit in 2014 to found Perfect Day with another vegan biologist, Perumal Gandhi, also now 27. Their Berkeley, California, company has developed a technology to insert a DNA sequence into microflora like yeast that produces casein and whey proteins that are identical to those found in cow’s milk. Rather than create its own line of grocery store items, Perfect Day, which has raised $40 million from investors, is selling its proteins to large food manufacturers to turn into mayonnaise, protein bars, baby formula and cookies.
“We’re developing a toolkit for the food industry,” says Pandya, whose success with Perfect Day landed him and his cofounder on Forbes’ latest 30 Under 30 list. “Because we’re making those functional ingredients, we can work with every brand under the sun that’s currently buying dairy ingredients and help them to move their food products in a greener direction.”
For Pandya, developing this science is about more than creating a tasty, vegan-friendly cheese. Cows remain a major producer of greenhouse gas—because of, well, bovine flatulence. So cutting down on the number of cows is a way to make the food industry more sustainable. These animal-free “milk” products use 98% less water and 65% less energy to create than ones that use dairy cows, and Pandya insists the food made with his proteins will cost no more than traditional items.
“As we’re nearing a population of 10 billion in the next couple decades, the way that we’re currently factory farming really needs to change,” Pandya says, shifting excitedly in his seat. He continues, laying out a grim scenario: “The production of animal products, like meat and dairy, uses more energy and water and produces more greenhouse gas emissions than the entire transportation sector.” In other words, Elsie is worse for the environment than an 18-wheeler according to forbes.com.
Pandya met Gandhi, his cofounder, while working in biomedical engineering. In 2014 they applied to biotech accelerator IndieBio. Seven days after submitting their paperwork, they were accepted and took $30,000 in funding to quit their jobs and start Perfect Day. (They chose the name Perfect Day after reading a study in which scientists played various songs around dairy cows; it turned out that cows were 4% more productive when listening to Lou Reed’s 1972 song “Perfect Day.”)
Creating an animal-free dairy product is also a hedge against calamities that can snarl the food chain, like disease or weather events. And that’s one of the reasons Singapore-based Temasek Holdings led Perfect Day’s Series A round last year.
“In the dairy industry there has always been a lot of volatility due to diseases and bovine issues,” says Aftab Mathur, director of innovation investments at Temasek. “Perfect Day has the only product which is essentially replicating cow’s milk. Nobody has done that today. You are actually looking at the same molecular structure as dairy milk. They are the only credible player developing considerable intellectual property in that space that they can develop before other players can catch up.”
The milk, cheese and cream manufacturing industry is estimated to have generated $600 billion in worldwide revenue in 2018. “Even if you can penetrate 1%, that is a multibillion dollar opportunity,” Mathur says.
Though it’s not on the market quite yet, Perfect Day plans to sell its dairy-free casein and whey protein to food manufacturers beginning later this year. This past November, Perfect Day announced a major step in getting to market: It will begin supplying food giant Archer Daniels Midland later this year. The food manufacturer, which is also an investor in Perfect Day, is working with Pandya and Gandhi’s team fitting its protein-making technology—previously used in small-scale experiments—into its factories to create mass quantities of food.
“When we look at opportunities in the venture space, we’re looking for technology that is potentially disruptive to an industry,” says Victoria De La Huerga, an executive at Archer Daniels Midland’s venture capital arm.
With Perfect Day-based food close to hitting grocery store shelves, Pandya can look back fondly to May 2014. To when he told his parents about the IndieBio’s funding—allowing him to quit his job and start a company making cow-free milk. “They thought it was a scam,” he says. “But they figured, usually scammers are the ones asking you for money, so why not go for it?”