Kääpä Biotech, a Finnish start-up that develops functional mushroom products, has secured a €900,000 strategic investment from global agri-food venture capital firm PeakBridge.

The funding will further enable Kääpä Biotech to scale its business to meet increasing customer demand for functional mushroom ingredients.

Kääpä’s divisions include Nordic Mushrooms, a supplier of B2B functional mushroom extract ingredients; Kääpä mushrooms, a supplier of B2C functional mushroom extract products; and Kääpä Forest, a B2B chaga mushroom cultivator.

Both Nordic Mushrooms and Kääpä Mushrooms use functional mushroom extract powders and liquids created using the start-up’s proprietary extraction process, NordRelease.

In September 2024, Kääpä opened a new growing facility in Paimio, Finland, underscoring the functional mushroom category’s rapid growth. Eric Puro, Kääpä’s CEO and co-founder noted that the company is seeing “huge interest” from a range of companies looking to get a start in the market in addition to existing customers looking to scale their functional mushroom business.

He commented: “Over 180 companies, in more than 20 markets, have placed their trust in us to provide them with the world’s best quality functional mushroom extract ingredients. This investment will help drive a new phase of growth, as we continue to scale our business to match the increase in customer demands.”

Yoni Glickman, managing director of PeakBridge’s seed fund FoodSparks, said: “Health and nutrition have always been a key investment focus for us at PeakBridge, and in this space functional mushrooms are emerging as a star ingredient”.

He added: “Kääpä Biotech stands out from the crowd with its innovative extraction technology and clinically validated products. Their focus on growing their own mushrooms also ensures traceability, stability in supply and consistent quality – all critical to this fast-growing sector. We're thrilled to back their expert team to jump-start the next phase of growth.”