In 2013, Mosa Meat made history by presenting the world’s first lab-grown hamburger, which came with a staggering price tag of over $300,000. Around the world, approximately 200 startups remain optimistic that cell-based meat, a more humane alternative to traditional livestock farming, could become a substantial component of our global food supply by around 2023?
Despite their unwavering optimism, achieving this level of success will by no means be guaranteed. By 2024, the industry had reached a precarious juncture, prompting several startups to scale back operations or cease trading altogether.
The trade aims to produce approximately 30 million kilograms of finished goods annually. Despite this, more than 100 billion kilograms of conventional meat are produced annually today. According to Paul Shapiro, the CEO of Higher Meat and author of “Clean Meat” (2018), even if plant-based alternatives currently account for only around 1% of total meat consumption by volume, it will likely take time for cultivated meat to achieve a similar level of market penetration.
Industry experts caution that any effort to mass-market cultured meat in major supermarkets or as a staple menu item by the end of the decade is “highly unrealistic,” according to an interview with TechCrunch.
Although preparations are underway, with funding available, constructing these facilities still requires a significant amount of time – typically spanning several years. According to Shapiro, the stark reality is that the funds simply aren’t available, which has led many companies to abandon their ambitious plans to construct large-scale manufacturing facilities.
New Age Eats ceased operations in early 2023, with founder Brian Spears citing financial constraints as the reason for shutting down, specifically noting the company’s inability to secure funding to complete its pilot facility. Established in Berkeley, California, we are excited to bring our expertise to a brand-new facility in the Chicago area. Israel-based food-tech company Aleph Farms halted its plans to launch a cultured meat product in the US market in June, citing ongoing difficulties in elevating sufficient capital for the venture.
The San Francisco Bay Area will go space-based entirely by June. SCiFi CEO Joshua March lamented, “Unfortunately, amidst this challenging fundraising environment, we were unable to secure the capital needed to bring our innovative SCiFi burger to market, ultimately leaving SCiFi Meals with no choice but to cease operations.”
“A pivotal moment is unfolding in the biotech sector, with the potential for cultivated meat to spearhead a broader revolution,” said Dr. David Kaplan, Professor of Biomedical Engineering at Tufts University. “The global financial landscape is currently experiencing turbulence, leading investors to exercise extreme caution and reassess their investment strategies.”
Startups focused on lab-grown meat are driven by more than just scientific inquiry or a desire for a humane, yet nutritionally equivalent, protein alternative; they are also motivated by the pressing need to revolutionize an industry plagued by environmental and animal welfare concerns. To address the pressing issue of global food security, most world organizations, alongside the United Nations, are working diligently to produce sufficient sustenance for the projected 9.7 billion people expected to inhabit our planet by the end of the century.
As cultivated meat gains traction, many anticipate that it will account for a significant percentage – potentially as much as 60% – of our protein intake, without the need to slaughter animals or exploit natural resources on the scale required by traditional livestock farming.
Despite initial promise, this region had languished for over a decade.
Companies developing cultured meat, often referred to as clean meat or cultivated meat, manufacture it from animal cells, including stem cells, that are nourished by growth factors in a controlled cellular environment or medium. Cells cultivated in bioreactors are subsequently treated with various compounds and seasonings to mimic the sensory attributes of traditional meat, including its appearance, texture, and sensation when chewed.
While many companies struggle to produce substantial quantities of lab-grown meat at a cost comparable to traditional alternatives, let alone at a price that consumers find affordable. The prices for these services range in the tens of thousands of dollars and require a significant amount of time, often spanning multiple years, to develop. Reaching for the perfect blend of style and texture can be a challenge, as is adjusting the sensibilities of individuals prone to scrutinizing such nuances.
Only a handful of corporations have successfully secured regulatory approval in the U.S. For their cultivated meat products.
A precipitous decline in venture capital funding for enterprises poses a profoundly significant challenge. Between 2021 and 2022, cultivated meat companies attracted more than $1.6 billion in venture capital investment, according to recent statistics. As of June, Crunchbase had shown a significant increase in funding for this industry up until 2024.
“The complexity of transforming the food system and revolutionizing the way we eat may well be the most predictable finding one could arrive at,” said Amy Chen, chief operating officer at Upside Foods, in an interview with TechCrunch.
Despite reservations, she shares the prevailing optimism within the cultured-meat industry that this innovation will come to fruition. She believes that a tipping point may emerge, triggering a surge in growth as equalizing forces take hold, leading to rapid advancements in manufacturing, regulatory approval, and improved production methods, ultimately driving down costs, increasing public acceptance, and making the product more accessible.
Will authorities’ funding be enough for a successful rescue?
Before tackling technical glitches, corporations must first address their financial challenges in order to successfully resolve the former. According to Nick Cooney, a managing associate at Lever VC, funding for the “class” has plummeted over the past year, primarily due to the widespread decline in venture capital investments. “While other sectors have seen a decline, this particular industry has continued to grow.”
While AI poses significant challenges for venture capitalists, they currently shy away from investing in tech startups requiring substantial upfront capital expenditures, lacking significant revenue or earnings, and struggling to demonstrate viability.
“Venture capitalists’ pivot from focusing on growth to prioritizing profit has had a devastating impact on the market,” said Alex Frederick, a senior knowledge analyst at PitchBook. It’s challenging to demonstrate value when you lack a tangible offering to showcase, he admits.
According to PitchBook, cultivated meat fundraising has experienced a significant decline in recent years, with figures indicating a double-digit drop. As of early 2024, the initial quarter’s pace suggests a slowdown in funding akin to that seen in 2023, with only 12 proposals received thus far. Additional deals worth around twenty are currently in negotiation, according to him.
As of January 2024, data from PitchBook indicates that roughly 200 cultured meat companies have emerged globally. However, due to most cultivated meat companies being startups, if they fail to maintain access to additional venture capital, they often risk exiting the market or being acquired. The market currently finds itself at a precarious stage, according to Tuft’s Kaplan, with no clear indication as to when this status quo might shift or which players will ultimately emerge victorious.
Startups may find a viable solution by outsourcing cell manufacturing, instead of each individual company investing $100 million to $200 million in building their own facilities, suggests Frederick. While enterprise capitalists have historically supported this approach, they’ve also invested in companies such as Ark Biotech, exemplifying their enthusiasm for this strategy.
Kaplan highlights an alternative financing option: if governments are willing to step in and provide support. Singapore has taken a pioneering step by becoming the first country to approve cultured meat for human consumption. It’s dedicated. As Kaplan, a renowned expert at Tufts, suggests, we may witness more countries taking part in the observation process.
“In a world grappling with meal safety concerns, the question arises as to how much investment the federal government should allocate to address these issues.” “As the federal government has invested heavily in battery technology and semiconductors, it will be equally crucial that they commit similar resources to cultivating meat alternatives if we are to successfully drive innovation.”
He has cause to hope. The entrepreneur behind Mosa Meat’s record-breaking $300,000 burger argues that most major companies today could replicate this same patty for just $20.
At first glance, the cost appears steep – roughly equivalent to a McDonald’s Large Mac. Yet, in just a decade, the price plummeted by four orders of magnitude, largely due to modest government backing, according to him.
‘Huge’ engineering hurdles
Despite financial ease, the industry still struggles to figure out its approach. Upside Meals . .
So does competitor Eat Simply. According to founder Josh Tetrick, his company has already produced 10 times the volume of cultivated meat than the entire industry’s remaining output combined. “While acknowledging the point, he candidly told TechCrunch, ‘That’s hardly any meat.'” To put it into perspective, the volume is measured in mere thousands of kilograms, illustrating its minuscule scale, as only a select few companies possess regulatory clearance.
Two companies, Eat Simply and Upside Meals, have secured regulatory approval to market lab-grown meat products to consumers, with Eat Simply becoming the first to introduce them in Singapore and later in the US. Tetrick’s strategy involves focusing on developing methods to produce vast quantities of high-quality meat at a cost comparable to, or even lower than, that of conventional livestock farming. While acknowledging that significant engineering and technological barriers must first be addressed.
As an illustration, his company is focused on increasing cellular densities, specifically cultivating edible cells at a higher rate per unit volume. The primary objective for manufacturers is to maximize the output of meat per bioreactor unit?
There exist various approaches to assessing cell density, each with its unique methodology and advantages. Researchers employ either batch strategies, involving the simultaneous processing of a large quantity of cells and nutrients, or steady-state strategies, characterized by a continuous flow of inputs and outputs. Cells are stirred when incorporating modern cell feeds; others lower the cells and revolve the partition walls of the reactor.
The ongoing debate about which applied science will prove most beneficial remains an open question in the scientific community. Believer Meats, a pioneering cultivated meat producer, has demonstrated its innovative prowess by achieving cell densities exceeding 100 billion cells per litre through its proprietary suspension culture process – a feat that significantly surpasses industry standards by a remarkable 17 times. This significant increase in yield, ranging from 2% to 36%, demonstrates a substantial improvement in the quantity of edible meat obtained per run.
Expensive cell meals
Passing the reactor engineering, another significant challenge lies in balancing both the engineering and pricing of the cell process mediums? Occasionally, food presents a blend of essential components, including energy sources such as glucose, which may comprise amino acids, salts, vitamins, water, and other vital elements.
The expense to deliver this content at scale, coupled with a substantial investment of tens of thousands of dollars, proves to be quite costly for constructing such a facility. According to a study conducted by the Division of Agricultural Economics at Oklahoma State University, it was found that producing 1 kilogram of cell-cultured meat would cost approximately $63. Compared to the price of $6.17 per kilogram for beef?
Wild-type, a pioneer in sustainable aquaculture, is revolutionizing the production of farmed salmon by cultivating it using cutting-edge technology and innovative methods. Since its inception as a solitary cell, the company has refrained from reverting back to its animal form, having instead opted to focus on expanding its cellular makeup over the past five years, according to co-founder Aryé Elfenbein. With this new insight, scientists have been able to optimally nourish cellular growth, resulting in a substantial increase in cell density.
“We’ve significantly enhanced the yield of that course over time by identifying the optimal vitamins for cell growth,” Elfenbein explained. “Raw fish is inherently complex, with multiple aromas and components that we aimed to simplify into a cohesive, defined product from the outset.”
Scientists are exploring innovative approaches to obtain cells without harming animals. MarineXcell is pioneering the creation of embryonic stem-like cells, known as induced pluripotent stem cells (iPSCs), from crustaceans such as lobsters, shrimp, and crabs by harnessing advanced nuclear reprogramming technologies.
The Israeli-based company claims that its expertise, led by Chief Scientific Officer Yossi Buganim, enables cell growth to accelerate twice as quickly as adult stem cells, while also preserving the ability to differentiate and maintain cellular progress over time – even under suboptimal conditions? Buganim’s laboratory has already leveraged its expertise in bovine cell manipulation and is now applying similar techniques to the study of crustaceans, further expanding its scope.
Collaborating effectively with the federal government requires a thoughtful and strategic approach.
Founders claim that a scarcity of regulatory insurance policies is hindering industry progress, in addition.
According to Wildtype co-founder Justin Kolbeck, the main reason many companies have yet to launch their products is… Customers are keenly observing their progress as they navigate a prolonged, multi-year regulatory review process. It is crucial that meal regulators meticulously examine every aspect of our products, guaranteeing that only the safest options reach the market.
Nobody thinks meal security is a space where you can cut corners – indeed, Wildtype’s conversations with the U.S. The Food and Drug Administration has been a collaborative partner in “constructive and iterative” regulatory processes with industry stakeholders for many years, according to Kolbeck. Despite this, the corporation has engaged in discussions with potentially massive clients interested in purchasing their products immediately. And Kolbeck, the head of the FDA’s Center for Devices and Radiological Health, has a clear timeline: Wildtype’s regulatory approval is expected in 2023.
According to Chen at Upside, significant strides are being taken towards realizing their objectives. Regulators now possess a heightened comprehension of cultivated meat, accompanied by elevated levels of informed security and regulatory scrutiny.
Once we secured primary FDA approval, the industry’s concerns about the product’s credibility and safety were largely assuaged. The question of whether this innovation would ever gain accreditation had been effectively answered. Now, our next-generation products will follow the same regulatory pathway, but that’s a matter of timing, not uncertainty.
Public notion
After securing regulatory approval, both Upside Foods and Eat Simply launched their lab-grown chicken products at various restaurants. Despite this, Chen from Upside and Tetrick from Eat Simply agree that these pilots will not stop until they’ve scaled new heights.
One significant challenge they identified was the lingering perception that plant-based alternatives are less appealing due to their labels, such as “Frankenfood,” “fake meat” or “lab-grown” meat, which can be off-putting despite being technically accurate. Florida has
“For consumers, a major challenge lies in understanding how our assistance can make them fall in love with our cultured meat product, comprehend its unique value proposition, and grasp what benefits they’ll derive from trying it.”
Kaplan, a prominent voice at Tufts, suggests that supplementary education, increased industry transparency, and peer-reviewed research from esteemed institutions can collectively contribute to a positive outcome.
Chen anticipates that the sphere will undergo significant transformations over the next two years, likely exhibiting a vastly distinct nature by then. The entrepreneur is confident that her cultured meat product will soon tantalize palates across various regions, predicting that many people will take their first bite and declare it “absolutely delicious.”
Lever’s Vice President of Venture Capital, Cooney, notes that tangible advancements are underway. Lever’s portfolio company Intelligent Carnivore, a cultured meat firm, has secured funding of $9 million in a recent round. “With a focus on cost reductions, the company has identified a way to manufacture substantial pilot quantities at a relatively low capital expenditure,” Cooney noted.
While executing its core strategy globally, Eat Simply has been focusing on introducing its cultivated meat products to the retail market in Singapore during this interim period. The product is a blend of 3% cultivated meat and 97% plant-based proteins.
Tetrick concedes that the current figure is significantly lower than the 60%+ milestone achieved by Eat Simply when it first launched in 2020. Notwithstanding this, Jones is convinced that producing meat at a mere 3% will significantly reduce costs, ultimately enabling the company to build more customer experience and awareness around cultivated meat.
He intends to gradually increase this 3% by 3-5 years, concurrently focusing on cost-effective infrastructure development, optimizing cellular densities, and reducing media costs.
Tetrick downplayed any notion that there’s a mystical quality to the process, saying simply: “We must diligently complete the required tasks across various realms in order to achieve our goals.”
