Upcycling company Do Good Foods filed for Chapter 11 bankruptcy protection, according to a filing in Delaware.

The Bedminster, New Jersey-based company developed a closed-loop system to convert grocery food that can’t be sold or donated into nutrient-dense animal feed. 

In 2021, Do Good raised $169 million from asset manager Nuveen and built a production facility in Bucks County, Pennsylvania. It launched Do Good Chicken last year, which is now available at select locations in New York City, Philadelphia and Chicago, and partnered with Post Holdings to sell carbon-reduced eggs to foodservice locations.

According to the bankruptcy filing dated June 16, the company received a commitment of roughly $30 million in new financing to support its new business and fulfill existing contracts. Do Good Foods said the decision to file for bankruptcy is “an important step to put the business in a position to succeed and allow us to continue pursuing our goals.”

Earlier this year, the company’s co-CEO Justin Kamine told Food Dive that Do Good aims to scale up its operations across the U.S., with a goal of upcycling food waste into feed in every major metropolitan area.

As of May, it had processing facilities under construction in Fort Wayne, Indiana, and Selma, North Carolina. Kamine also said the company is working to bring more of its products to restaurants, universities and corporate campuses.

Do Good Foods estimated it has diverted at least 27 million pounds of food waste from landfills since 2021, the year the company was founded.

The bankruptcy filing underscores the economic headwinds nascent companies are weathering amid high interest rates and inflation. 

Venture capital funding in the food and beverage industry has plunged during the past year. Other companies in trendy sectors that tout the sustainability of their products, including indoor agriculture company AeroFarms and plant-based foods brand Tattooed Chef, also filed for bankruptcy in the last month.