The experiment started inside the laundry room of an apartment in Atlanta, Georgia, where the two college students created a nursery for 700 larvae of black soldier flies they bought on Amazon for $20. Sean Warner and Patrick Pittaluga weren’t raising the writhing bugs as pets. They were raising food for animals.

Warner and Pittaluga, who are cousins and Georgia Tech graduates, eventually moved the larvae farm out of their apartment and founded Grubbly Farms, which is breeding and selling larvae as a more sustainable protein and fat source for chickens, pigs and farmed seafood. Right now, wild-caught fish is a key ingredient in animal feed.

The little critters, Warner said, can help solve some of the planet’s most vexing environmental challenges.

“I tell all my friends that bugs are the future,” he said.

Producing animal feed based on fish, called fish meal, carries a significant environmental impact. Around 75% of the fish used in the feed are wild-caught species of small fish such as anchovies, herring and sardines. Demand for these species will likely increase as the world relies more on fish farming – and less on depleting wild fish stocks – to feed the growing appetite for seafood. The World Bank predicts the seafood farming will provide nearly two-thirds of the fish consumed worldwide by 2030.

Currently, 90% of those small fish (called forage fish) caught, or 28.4m tons, are turned into animal feed each year worldwide, according to a 2012 study funded by the Lenfest Foundation. Yet they’re also an essential food source for large mammals like whales and other predators. Earlier this year, scientists said depleting forage fish stocks were to blame for the record number of starving sea lion pups along the southern California coast.

Keeping more forage fish in the ocean creates a greater economic value, too. The Lenfest study showed that keeping them in the water as prey for larger, commercial catch would generate $11.3bn in value worldwide, compared to $5.6bn if they were taken out of the water. The US government says it is working on finding alternatives for fish meal, calling it an “active and important” area of research.

Warner and Pittaluga are running their business out of a warehouse in Doraville, Georgia, and they plan to hire their first full-time employee this month. Their initial business involves drying larvae and selling them whole as chicken treats. The farm hopes to generate enough revenue and raise more money to buy equipment for making fish meal, a process that involves extracting oil from dehydrated larvae and then grounding the larvae into a protein powder.

The cousins are targeting the chicken market initially because there is a strong demand for high quality feed. Chickens commonly eat dried mealworms, which come from a type of beetle that tends to be imported from China, where quality standards are uneven, Warner said. These worms also have less calcium and lysine, an amino acid, than the larvae of black soldier flies, he added.

Grubbly Farms is selling the chicken treats through its website, but the company would like to offer its products through feed stores and online retailers in the future.

Warner and his cousin ventured into the world of breeding flies during Warner’s final semester at Georgia Tech last year (Pittaluga graduated in 2014). While studying building construction, Warner began to learn about major environmental issues gripping the planet, including the challenge of feeding a growing population. He was fascinated by the idea of using insects to solve that problem, and initially, he flirted with the idea of making bug burgers for the Asian market.

Eating insects doesn’t carry the same gross-out factor in other parts of the world as it does in America and other Western countries. More than 2 billion people consume bugs such as caterpillars, locusts and termites as part of their daily diet, according to a recent United Nations study. Bugs tend to be high in protein and good fats, and, because most insects don’t produce methane, they emit fewer greenhouse gas emissions than livestock.

“All the insects you can buy in Asia are frozen whole,” said Warner. “We thought it would sell if you could make a processed insect burger patty, a westernized version of a burger.”

But after conducting market research, the cousins discovered that the animal feed market might present a greater opportunity. Getting started took some trial and error. Most edible bugs are harvested in the wild, and farming insects for food isn’t common, although the practice is growing, according to the UN report.

With little knowledge and more than a little gumption, they started breeding larvae in the laundry room of their downtown Atlanta apartment. The larvae hatched into flies, which they then bred using artificial light. This part was a challenge, said Warner, because flies breed more easily in natural sunlight, so it was difficult to recreate a similar setting indoors.

Their laundry room became a big attraction for friends. “Most people wanted to come over to see it out of both disgust and curiosity,” said Warner.

Their landlord didn’t know about the project, but there were a few close calls. Once, they scrambled to tear down the fly breeder and hid it under a tarp on the porch when the landlord sent over a maintenance crew to check on the apartment’s heating and air conditioning system. “As soon as they left, we set it back up,” said Warner. “They never found out.”

Another time, a bedtime check of the larvae led them to a scene that would make most people’s skin crawl: thousands of larvae pouring out of their bin and crawling all over the laundry room walls.

“We swept and vacuumed them off the walls,” said Warner. “I don’t know what our apartment would have looked like the next morning if we hadn’t checked.”

Warner’s parents took a while to warm to the idea, but when he started turning down job offers to pursue the project, they realized he was serious.

The cousins got their start with a $20,000 prize through a Georgia Tech initiative called Create X, which aims to help students launch their startups. They’ve since raised money from family and friends and other startup accelerators, though they declined to disclose the amount. Most recently, Grubbly Farms won a startup competition sponsored by Target that helped to raise the company’s profile, Warner said.

The startup plans to stay at its pilot production facility over the next year or so as it works on developing the equipment and process for growing larvae in larger quantities and turning them into oil and protein powder. Its next goal is to increase its larvae population to 15m, Warner said. He and Pittaluga are also working on sales strategies.

“We’re trying to figure out whether we want to just sell the insect protein to feed manufacture, or manufacture the feed ourselves so we would be in charge of selling the fish feed to fish farms directly,” he said.

The company’s chicken treats have gotten some encouraging feedback from customers. “My hens gave an enthusiastic 10 feathers up,” said Kerry Hubbard in her blog City Girl Farming. “They LOVED them.”

Grubbly Farms faces some tough competition since it isn’t alone in supplying alternative ingredients for fish meal. Other companies, such as EnviroFlight in Ohio and Enterra Feed in Canada, are also breeding black soldier flies to make animal feed.

Black soldier flies are only one of the alternatives to replacing wild-caught fish. Researchers also peg microalgae and silkworm as good substitutes.

Grubbly Farms’ business plan is just about creating more nutritious and sustainable animal feed, Warner said. It’s also looking to tackle America’s billion-dollar problem with food waste – produce and leftover foods being tossed away by businesses and homes and clogging up landfills at the rate of 52m tons per year. Warner is feeding the larvae eat fruit and vegetable pulp from a local juicery, and the company has also recently started working with a bakery to add days-old bread to the mix. Warner estimates that once production is up-and-running, they will use around two tons of food waste a day.

The cousins want to eventually set up farms in other parts of the world, such as India, where they could use organic waste, such as human feces, and help to address sanitation issues. Black soldier fly larvae contain antimicrobial properties that could potentially reduce E coli and salmonella in organic waste.

As the larvae eat through the human waste, said Warner, they reduce it in volume and weight while also aerating it, reducing the odor.

“We’d set up a facility similar to a septic tank that would use the larvae to sanitize the waste and provide a protein source for the larvae,” said Warner. “We’re just trying to be as sustainable as possible in most aspects, and close a few loops along the way.”