From Mushroom to Market: Adi Reza Nugroho’s Sustainable Innovation Journey to Australia

Expanding into Australia’s growing plant-based market has been a significant milestone for Adi Reza Nugroho, the co-founder and CEO of PT Miko Bahtera Nusantara (MYCL). This Indonesian start-up specialises in transforming agricultural waste and mushroom mycelium into sustainable materials, including eco-friendly leather and construction products. By tapping into Australia’s demand for plant-based and sustainable products, MYCL is showcasing its innovation on an international stage.

The opportunity to enter the Australian market came in November 2024, when MYCL participated in the Global Sourcing Expo Australia, an annual exhibition connecting international leaders in textile and apparel sourcing. Supported by the Australian Alumni Grant (AAG) and the Indonesian Consulate in Melbourne, MYCL presented its flagship product, Mylea—a sustainable leather made from mushroom mycelium.  

Held from November 19 to 21 in Melbourne, the expo gathered key players in the fashion industry, including manufacturers, department stores, importers, retailers, and agents from Australia, New Zealand, and the Asia-Pacific region.

“Participating in the event had a significant economic impact on our business because we met potential buyers and investors in person,” said Adi.

Mycelium, the thread-like structure forming the root system of fungi, is central to MYCL’s sustainable innovation. Known for its durability, biodegradability, and recyclability, mycelium absorbs nutrients from decaying matter and acts as a natural binder. Inspired by its use in making tempeh, Adi and his team at MYCL explored its potential to create high-performance materials from agricultural waste, such as sugarcane and palm oil residue.

Starting with experiments in a home kitchen using a pressure cooker, MYCL has grown into a company that produces innovative materials for industries ranging from construction to fashion. Its eco-friendly products include particle boards, insulation materials, and Mylea, a sustainable alternative to conventional leather.

“The mycelium technology developed by MYCL addresses two key issues: reducing agroforestry waste and creating sustainable materials. It provides an effective way to manage the country’s agricultural by-products, which are a significant source of greenhouse gas emissions,” Adi said.

Australia: A Strategic Market

The Global Sourcing Expo Australia marked MYCL’s first major trade fair in the Australian market, building on its earlier participation in pop-up exhibitions, such as Melbourne Fashion Week in 2023. Adi highlighted the expo’s importance, describing how it provided a platform to test products, network with industry leaders, and gain insights into market dynamics.

“Data shows that 61 per cent of Australian adults prefer vegan products, which aligns perfectly with our offerings. We wanted to test our eco-friendly products with industry players and experience the market dynamics firsthand,” he said.

The event exceeded expectations, with MYCL securing supply agreements worth AUD 25,000 and signing memorandums of understanding (MoUs) with Australian distributors. In addition, MYCL established partnerships with academic institutions, including the Royal Melbourne Institute of Technology (RMIT) and Monash University, to explore potential collaborations.

“We gained valuable insights into what we need to expand our business in Australia and the opportunities available to us,” Adi added.

Adi acknowledged the unique challenges of running an innovation-based business in Indonesia, particularly in securing funding. Indonesian investors often perceive such ventures as high-risk compared to more traditional business models. This is not the case in Australia, where innovation-based businesses thrive.

“Australian investors are experienced in developing innovation-based ventures, from technology development to monetisation and intellectual property protection. It’s one of their growth strategies,” Adi explained.

Support from Australia Awards

Australia’s support through the Australia Awards has been instrumental in MYCL's journey. In 2018, Adi participated in the Australia Awards Short Course on International Business Readiness at the Queensland University of Technology, where he learned strategies for scaling innovation-based businesses, managing intellectual property, and applying sustainability metrics. “The knowledge we gained helped us transition from laboratory-level production to commercial manufacturing,” he said.

That same year, MYCL’s CFO, Annisa Wibi Ismarlanti, attended the Australia Awards Short Course on Start-up Ecosystems at Flinders University in South Australia. Additionally, in the same year, MYCL received funding through the Australian Alumni Grant Scheme, administered by Australia Awards in Indonesia, enabling crucial research on palm oil waste material and fire testing for its products.

These experiences have also empowered MYCL to build capacity among its network of mushroom farmers, improving the quality of their produce and increasing production output, further strengthening MYCL's impact and growth.

Since its inception, MYCL has achieved remarkable growth. The company now produces 5,000 square feet of mushroom mycelium-based leather monthly, up from just hundreds of square feet in 2017. It has also indirectly benefited 200 mushroom farmers while processing 20,000 tonnes of agroforestry waste—equivalent to preventing 10,000 tonnes of CO2 emissions from land clearing. MYCL’s sustainable leather production saves approximately 15 million litres of water compared to conventional leather manufacturing, further underscoring its environmental benefits.

Australia as a Development Hub

For Adi, Australia represents more than a market—it is a strategic hub for future development. He envisions leveraging Australia’s advanced technology and expertise to diversify mycelium-based applications beyond leather. Potential areas of expansion include healthcare, automotive components, and industrial materials.

“We see Australia as a landing pad to develop our technology faster. With advanced facilities and expertise, we can explore mycelium’s potential in creating a broader range of products,” Adi said.

By working with Australian partners, MYCL also aims to strengthen the diplomatic and economic ties between Indonesia and Australia.

“Indonesia has innovators like MYCL, but scaling up remains uncertain. Australia, with its advanced tools and expertise, can help commercialise these innovations. Strengthening this collaboration could benefit both countries significantly,” Adi remarked.