Funds Startups Backs Hot Spring Algae Startup ONSOH via Convertible Bonds
Funds Startups Inc. said its Fund No. 2 investment partnership has funded ONSOH Inc. through convertible bonds, the first convertible bond financing by the company and the funds it manages.
1 source 2h ago
Reporting from 1 source: ASCII.jp.
Why it matters
The deal tests whether venture debt and convertible bonds can carry a regional deep tech startup from lab validation toward mass production without the equity dilution that comes with repeated share sales.
Key Facts
- Funds Startups Inc. provided funding to ONSOH Inc. through convertible bonds via its Fund No. 2 partnership.
- ONSOH develops RG92, a bio-material for livestock and aquaculture made from microalgae derived from Beppu hot springs.
- Funds Startups says the deal is its first convertible bond financing and the first for the funds it manages.
- Fund No. 2 completed its first close at the end of June 2026.
- ONSOH is based in Beppu City, Oita Prefecture, and is expanding into markets including India and Southeast Asia.
ONSOH, based in Beppu, Oita Prefecture, develops RG92, a bio-material for livestock and aquaculture feed made from microalgae that grows in the area's hot springs. Fund No. 2 closed its first close at the end of June 2026.
RG92 is drawn from a proprietary strain of microalgae that grows in Beppu's high-temperature, high-mineral hot spring water. ONSOH is testing the material on cattle, pigs, chickens, and fish, with verification at universities, research institutions, and production sites, and is selling overseas in markets including India and Southeast Asia.
Fund No. 2 is set up as an all-stage deep tech debt fund, pairing venture debt, subsidy bridge financing, and convertible bonds with share acquisition rights. ONSOH's stated mission is to improve livestock and aquaculture health without leaning on antibiotics.
Written with AI by Yomimono from the 1 cited source below, including Japanese-language reporting where cited. See our editorial policy.
Add Yomimono as a preferred source on Google