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Spanish startup InsectBiotech has secured €7.2 million ($8.3 million) in funding to construct a new production facility in Andalusia that will use black soldier fly larvae to convert agricultural byproducts from the olive oil industry into protein, oil, and fertiliser.
The investment round included participation from Arcano Partners through the Impact Andalusía Innovation fund along with undisclosed US investors. The new site will be capable of processing up to 7,500 tons of agricultural byproducts annually and is expected to become operational in the third quarter of 2027.
Cofounder and chief operating officer Ben Brown described the project as a major step in the company’s transition from research and pilot operations to commercial-scale manufacturing. The facility will produce 1,300 tons of fresh larvae per year, equivalent to 300 tons of high-protein meal, with plans to later ramp up to 10,000 tons of larvae annually.
Brown confirmed that nearly a dozen letters of intent have already been signed, with primary off-takers including aquaculture, swine, poultry, and pet food producers for the protein, vineyards and high-rotation berry crops for the frass, and biodiesel companies for the oil.
The company was founded in 2022 by Tobias Webb, Ignacio Gavilan, and Brown. They quickly recognised that the unit economics of black soldier fly larvae farming depend on solving two major challenges: feedstock and energy.
The insight came when Brown was driving through Andalusia and realised the region offers abundant olive pomace waste from olive oil production alongside vast solar energy resources, providing both low-cost feedstock and affordable renewable power in an area that needs investment and jobs.
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Spain generates approximately five million tons of olive oil production waste each year. Processing actors currently collect this waste to extract residual pomace oil and use the dry cake for biomass, paying mills per ton. InsectBiotech has secured long-term agreements with processing plants to ensure reliable access. While many early insect agriculture proponents argued for large, highly automated and expensive facilities, the founding team concluded that a lower-tech, medium-sized plant producing over 2,000 tons of protein and 4,000 tons of frass, powered by renewable energy, made more sense for their model.
The company developed a proprietary low-cost green chemistry process to remove anti-nutritional factors from olive pomace, making it digestible for the larvae. This mechanical process is highly economical, enabling feed costs up to one-quarter of conventional wheat-based formulations, and is protected by an approved patent. While the pomace requires supplementation with some additional amino acids, it accounts for 95 percent of the feedstock.
For energy, the facility plans to rely on 75 to 80 percent solar power, given Andalusia’s more than 3,000 hours of sunshine per year, supplemented with gas as needed. For infant black soldier fly larvae, the company aims to maintain a fifty-fifty split between in-house production and supply from specialist hatcheries to reduce supply risk, drawing a parallel with the poultry industry where rearing farms purchase day-old chicks. The founders also believe that genetic improvements in the larvae will continue to enhance production efficiency.
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As later entrants to the insect agriculture space, InsectBiotech benefits from lessons learned by early pioneers, who had to develop infrastructure and expertise from scratch. Today, the company can purchase off-the-shelf solutions from multiple vendors. The firm’s view is that the winning black soldier fly farming model combines true agricultural waste as feedstock, low-operating-cost production within the EU close to raw material sources, modular facility expansion, and a hybrid approach that balances automation with skilled human resources, delivering products that compete on cost rather than sustainability alone.
The founders emphasise that commercially viable insect farming does not hinge on a single breakthrough but on a combination of factors: modular construction enabling gradual capacity addition, cheap and abundant pre-aggregated feedstocks, competitive labour costs and job creation in Just Transition zones, solar-powered operations, and cost-competitive products aligned with mainstream demand rather than premium pricing in niche markets.
Longer term, InsectBiotech aims to become a global player by utilising olive pomace in multiple olive-growing regions. The company plans to establish five farms in Spain and potentially expand to Portugal and other jurisdictions where olive pomace is available, which includes about half a dozen countries worldwide.
