ÄIO Awarded €1M for Development of Yeast-Based Oils for Cosmetics Applications

Estonian biotechnology firm ÄIO has secured a €1 million grant from Estonia's Applied Research Programme to develop yeast-based oils for cosmetics and chemical applications. The funding will support a three-year R&D initiative focused on scaling up production processes and improving product functionality. ÄIO's fermentation process reduces land and water use compared to traditional oils, making it a more sustainable alternative for cosmetics manufacturers.

The grant comes at a time when the cosmetics industry is facing increased regulatory pressure, particularly related to deforestation and environmentally persistent compounds. ÄIO is already distributing ingredient samples to potential partners and plans to initiate a fundraising round in Q3 2026 for future expansion. The company aims to show that fermentation-derived ingredients have commercial potential while being environmentally friendly and safe for human health.