Agronomics puts $1.5m into lab-made leather firm VitroLabs

Agronomics has completed a subscription of $1.5m in US-based VitroLabs, it announced on Thursday, which is developing laboratory-produced, cruelty-free leather.

The AIM-traded company said the subscription was in the form of a ‘Simple Agreement for Future Equity’ (SAFE), which would convert at VitroLabs' next funding round, giving Agronomics an expected interest of approximately 3.79% in the form of Series A Standard Preferred Stock.

It said the subscription would be paid using cash from its own resources.

Agronomics explained that VitroLabs was founded by Ingvar Helgason and Dr Dusko Ilic in 2016.

Dr Ilic was described as a “highly experienced” stem cell biologist from King's College, London, whose technical expertise in tissue engineering and stem cell biology had been applied in VitroLabs.

VitroLabs' lab-grown leather offered an alternative to the use of animals in the supply chain for the fashion industry.

Its leather “significantly” reduced waste, production time frames and the environmental footprint associated with leather production, while providing a more consistent product.

Since the subscription was considered a substantial transaction under AIM Rule 12, Agronomics noted that the announcement required certain disclosures under Schedule Four.

It said VitroLabs is an early stage, pre-revenue company with costs of approximately $0.25m per month, and total assets as at 3 October of around $0.86m, including cash and near-cash of $0.5m, and no material liabilities.

“Agronomics is thrilled to work with VitroLabs,” said Agronomics chairman Richard Reed.

“VitroLabs is a perfect addition to our portfolio, as a pioneer offering a viable alternative to the slaughter of animals for leather predominantly used for fashion, automotive and interior design.

“As demand for transparency and sustainability grows in supply chains grows, especially in the fashion industry, we are eager to witness VitroLabs potential.”

Ingvar Helgason, founder and chief executive officer of VitroLabs, added that the company was “excited” to be working with the “experienced and dedicated” team at Agronomics.

“Their mission is deeply aligned with our own and we look forward to accelerating our growth and increasing our traction with their support and expertise.”