Food & Beverage

A more 'Perfect' milk: Start-up wants to make milk that 'scratches the itch' of dairy

Perfect Day Founders: Ryan Pandya and Perumal Gandhi
Source: Perfect Day

Got synthetic?

Almonds, soy, cashew: Nowadays there are so many different types of milk it's hard to keep track of them all. Now, one Silicon Valley food technology start-up is hoping to add one more version to the mix. Berkeley, California-based Perfect Day is pioneering "synthetic milk," a dairy-free alternative to the breakfast mainstay that claims to resemble — and taste — just like the original.

Perfect Day is less for the Silicon Valley Soylent seeking tech foodie and more for the eco-friendly or vegan consumer. The company is eyeing either milk, cheese or yogurt as being part of its inaugural lineup of dairy-free alternatives. The company's dairy offerings are lactose-free, and they use 98 percent less water in production, according to a study performed by a team of conservation biologists.

Earlier this year, Perfect Day raised $4 million and is currently looking to raise more.

Scratching the milk itch

When co-founders Ryan Pandya and Perumal Gandhi decided to join forces, they drew from a shared background in medicine, applying medical technology to creating food. Pandya came from nonprofit Mass Biologics which is a division of the University of Massachusetts medical school, where Gandhi was working on a master's degree in tissue engineering.

At first, they were struck by the idea of "cultured meat," a technology that could allow labs to grow organs for humans or muscle tissue for animals without the use of any actual animals. When they first began that quest in 2014, the technology was unfeasible.

Instead, the two men thought they could capitalize on something they both shared in common: A plant-based diet.

"Interestingly we didn't know each other at the time but Perumal and I had both recently adopted a plant-based diet," Pandya told CNBC in a recent interview.

"We found that when it came to finding something to put in your cereal or to put in your coffee, there were decent things out there for people that scratched the itch [like] soy milk, almond milk," he said. "When it comes to everything else that you do with cow's milk, the cheese or ice cream, that compelling option is not available yet."

If you'd asked us two years ago, 'How would the dairy industry perceive you?', I would have said they'd hate us. Today it's actually the opposite,
Perumal Gandhi
co-founder, Perfect Day
Mockup of Perfect Day Milk
Source: Perfect Day

With almond and soy milk, for example, creating cheese would likely result in something a bit more like tofu, Perfect Day's founders told CNBC.

Their product is made from milk proteins, but without the addition of gums or fillers to make up for the lack of protein the way other alternatives might. They have engineered lactose away from their dairy products, the lactose being the milk's sugar. Instead, they use plant-based sugar so the final product is both cholesterol- and lactose-free. The taste ends up being close to regular milk.

They have yet to decide which product will launch first, but consumers can expect a product to be available commercially by end of 2017. While the water use, land use and greenhouse emissions are key environmental benefits to their manufacturing styles, Perfect Day will initially target organic food eaters, before ultimately trying to lower prices below most milks available on store shelves.

Perfect Day isn't the first to try its hand in the Bay Area at creating an alternative to milk or other foods. Soylent, whose mission is to provide maximum nutrition with minimal effort began shipping its first product, a powder meal substitute, in 2014. Though Soylent looks more like flour than food, the product has gained a wide following in Silicon Valley, especially among engineers who could now drink their dinner while they code.

Today, the company has launched a slew of other products including a food bar and coffee drink.

Perfect Day will have its share of competition. Milk alternative "Ripple," a product made by the founders of Method that uses milk rather than plant-based alternatives like coconut or almond milk; and eggless mayonnaise alternative maker Hampton Creek, are just a few food technology companies already in the start-up aisle.

Although their market is getting crowded, Perfect Day isn't looking to disrupt the dairy or dairy alternative sector. Rather, the principals argue they'd like to offer another option.

"If you'd asked us two years ago, 'How would the dairy industry perceive you?' I would have said they'd hate us," said Perumal.

"Today it's actually the opposite," he added. "We're in talks with three of the largest dairy companies on the planet to hopefully partner up with them to speed up our time to market and allow people more access to our product." The dairy industry, they say, has been very receptive to the product.

It also doesn't hurt that on board as CTO is Tim Geistlinger who was the vice president of research and development at plant-based burger company Beyond Meat and Ravi Jhala, Perfect Day's head of food development, was formerly an innovation manager for Chobani.

Perfect Day investor, Hong Kong-based Li Ka-shing's Horizon Ventures, is also invested in Impossible Foods and Hampton Creek, among other tech and food tech companies.