Cambridge startup Neela Biotech raises £2.1M from Elbow Beach to turn waste into jet fuel with AI

Cambridge startup Neela Biotech has raised £2.1 million in pre-seed funding to try a different route into sustainable aviation fuel: using food, agricultural and forestry waste instead of the waste oils and fats that dominate the market now. Elbow Beach led the round with £1.5 million. Ascension, Cambridge Enterprise, Ventures Together and strategic angel investors also joined in.

The timing matters because the supply problem is getting worse, not better. IATA expects sustainable aviation fuel to reach only about 2.4 million tonnes in 2026, which would still cover just 0.8% of aviation fuel use. Yet the net-zero target calls for around 500 million tonnes a year by 2050, and the UK has its own mandates climbing from 2% of jet fuel demand in 2025 to 10% in 2030 and 22% in 2040.

Neela is founded on a simple complaint from its CEO and co-founder, Deepanshu Singh: most SAF today comes through HEFA, the process that turns waste oils and fats into fuel, and there isn’t nearly enough of that feedstock to meet demand. The startup says it will pair AI-guided microbes with anaerobic digestion and install the system at existing biogas plants rather than build new sites from scratch. That is the core of its pitch: less capital, less energy use, and a route that might plug into infrastructure already in place.

The company, incorporated in April 2025 by Singh and Friederike Nintzel, plans to move from lab work to a pilot-scale trial at a biogas plant over the next two years. It also argues that existing biogas operators need new income as subsidies run out. But the hard part is still ahead. Neela has not run a pilot yet, and it has not said what a tonne of its fatty acids would cost.

That leaves the startup in a crowded field. OXCCU, Metafuels and WtEnergy are all chasing different SAF routes with bigger rounds and different inputs, while Neela is betting that biology plus existing plants can do something the sector keeps promising but rarely proves: reach cost parity with fossil jet fuel at scale.