EU Startups - 27/06/2022

Unleashing the magic of mushrooms, UK-based startup Magical Mushroom Company has scored over €3.4 million in fresh funding. The startup is on a mission to tackle the growing plastic problem through nature-based alternatives.

Plastic pollution is one of the largest challenges of our time. Sadly, seeing plastic thrown away carelessly, polluting parks, streets, water systems, and beyond is more common than not. One of the biggest contributors? The overuse of plastic to package goods and products. 

Tackling this, by harnessing the magic held in mushrooms, UK-based Magical Mushroom Company has developed biodegradable packaging alternatives – aiming to tap into the multi-billion euro European polystyrene packaging market. 

Leading the Seed round (over €3.4 million) was Ecovative Design LLC with participation by Dale Vince, founder of Ecotricity – the world’s first green energy company; Robert Del Naja, the renowned activist – artist and musician; and Marcus Watson – co-founder of Adoreum Partners, who brought 30 investors in.

It’s reported that global plastic waste more than doubled from 2000 to 2019 to 353 million tonnes with 40% of that waste coming from packaging. Meanwhile, research suggests that 90% of public sustainability claims will not be met by 2025 with the majority of companies remaining reliant on single-use packaging. Magical Mushroom Company’s solution is a direct replacement for plastic-based packaging, such as polystyrene and cardboard, and has the potential to remove them entirely from global supply chains. 


Founded in 2019, Magical Mushroom Company puts agricultural waste to work by combining it with mycelium – the root structure of a mushroom. The startup creates a material that is biodegradable, durable and comparable in price to traditional packaging derived from fossil fuels like polystyrene. Unlike other compostable packaging, the product breaks down naturally in the ground in around 45 days without any additional chemicals or industrial facilities. 

Paul Gilligan, CEO & founder at Magical Mushroom Company, explained: “We have just eight years to meet the UN’s Sustainable Development Goals and businesses have a crucial role to play – but they need viable and cost-effective solutions that significantly reduce the carbon footprint across their entire supply chain. We’re proud to be creating value from waste and unlocking the potential of mycelium – a resource that has been untapped to date. We’re delighted to have the support of a brilliant group of investors who have a wealth of experience in driving sustainable change and share our vision for the future of packaging solutions. The magic of mushrooms is only just being realised and we can’t wait to make it mainstream.” 


Already the company is serving clients from international brands such as Raymarine, BA Components, Castrads,  Ffern, Selfridges, Lush, Seedlip and ID Watch. 

This investment will be used to fund the opening of Magical Mushroom Company’s first raw material production plant – due to open in Beeston, Nottinghamshire. It will allow the startup to gain control of the entire packaging manufacturing process and create new jobs. The funding will also be used to implement automation upgrades at the company’s existing packaging plants in the UK and Bulgaria to scale production as well as lower costs.

Thomas Van Haren, Director of MycoComposites at Ecovative Design LLC added: “The packaging industry is ripe for change and innovative solutions must be supported so that we can move away from our reliance on fossil fuels. In the Magical Mushroom Company, a viable alternative already exists that is producing high-quality sustainable packaging on an industrial scale. Paul and his team have made incredible progress in a short period of time as demonstrated with the opening of their latest high-tech plant in the UK. We were inspired by their vision to scale the business and we’re looking forward to supporting their mission to help remove polystyrene packaging from manufacturing supply chains.”