Start-ups developing new materials like mushroom and lab-grown leather raised $457 million in 2022, down from $980 million in 2021, according to a report published Wednesday by think tank Material Innovation Initiative.

The slow-down reflects a more challenging market in 2022, following an unprecedented spike in investment in the sector a year earlier.

On the other hand, the number of companies focused exclusively on developing next-gen materials has grown to 102, more than tripling in the last 10 years, the report found.

This year is expected to bring more focus on the environmental performance of new materials as brands and investors look to scale up offering that can help them tackle sustainability challenges.

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