By Agroempresario.com

Climax Foods, a plant-based cheese innovator, has successfully secured bridge funding to sustain its operations through the year-end, following a challenging period marked by layoffs and salary cuts. The company, led by CEO Dr. Oliver Zahn, has faced significant financial strain, but is now positioning itself for a turnaround with a restructuring plan and new commercial focus.

After furloughing half of its employees in December 2023, Climax later laid off a substantial portion of its staff, with only a small team remaining by August 2024. In response to these difficulties, Zahn reduced salary costs by 80%, with furloughs and voluntary salary reductions, keeping just a core group of employees to run the business.

Zahn recently announced that the company has secured bridge funds from existing investors, enabling it to begin bringing back employees. "We’re bringing people back from furlough, and restructuring to focus on new roles in commercial operations," said Zahn.

Restructuring and commercial leadership

With the shift from research and development to commercial rollout, Climax Foods is seeking new leadership in its commercial division. Zahn explained that while the company has not yet raised a priced round, it is creating a formal board to guide the business as it moves forward.

The company has raised approximately $26 million to date, with support from investors like At One Ventures, Climate Capital, and Bel Group. Climax is now focused on achieving profitability within the next 2.5 to 3 years, with plans to scale production of its plant-based cheeses.

Partnership with Bel Group and scaling challenges

Despite the challenges, Climax Foods' partnership with Bel Group, famous for brands such as Babybel and The Laughing Cow, remains on track. The collaboration aims to develop plant-based alternatives to iconic cheese products, though it will take time for these products to reach the market, with launches expected by late 2025.

Climax has faced criticism for its ambitious plans, with former employees raising concerns about the scalability of its plant-based casein ingredient and overall cost structure. Zahn, however, remains confident, stating that recent scale-up trials have been successful and that the company is moving toward more efficient production.

Outlook and future plans

Zahn acknowledges that the road ahead is challenging, but believes Climax Foods has the potential to overcome its current hurdles. "We have very supportive investors and mission-aligned individuals," said Zahn, emphasizing the company's resilience in the face of economic cycles. With a renewed focus on commercial success, Climax Foods is determined to emerge stronger and become a key player in the plant-based cheese market.