One of a series of cell-cultured meat startups moving from lab to pilot scale, New Age Meats (founded in 2018) will also use the new funds - which take its cumulative funding to $32m - to double the size of its workforce, said founder Brian Spears, a chemical engineer with a background in industrial automation.
While investors understand that cell-based meat is a longer-term bet than plant-based meat, once you get beyond the seed stage they want to see hard evidence that you have a scalable proposition, said Spears, who is beginning with a hybrid approach.
“I would say certainly much bigger players are interested [in investing in this space] who weren't previously," he told FoodNavigator-USA. "Certainly they are looking for capital returns instead of just being mission focused, and our differentiator is the volume and affordability we can bring to the cultured meat market.
“I kind of think of it as like this armada of ships that has set sail. In the beginning, they were all just like well let's try it. Now that we're in deep water, and almost to market, then bigger and bigger investors are seeing this as a viable opportunity.”
Hybrid approach: 'Why use animal cells to solve a problem that plants have already solved in a much more scalable and affordable manner?'
For the first wave of products at least, it makes sense to include plant proteins in the mix, and not just for cost or scalability reasons, he said.
“We're borrowing the best of what cell-cultured meat has to offer, which is the mimicry of actual animal based meat, right, combined with the other [plant-based] components that require us to build the full finished product. There are multiple plant ingredients that we add and they come in in different stages. But [primarily] the plants provide texture... there's a certain bite that you get as you chew.”
But if plant-based meat has great texture, and right now, at least, is cheaper than cell-cultured meat, why make cell-cultured meat at all?
“If we could recreate all the experience of eating meat with simply plants,” then that would be a fair question, said Spears.
“Unless animal cells are uniquely delivering some of the key sensory aspects of meat, or whatever the consumer values, then they shouldn't be in there. But we think of the cells as factories that really deliver the meat experience.
“In our case we have adapted the cells to deliver that sensory experience really well. A lot of the value people get from meat is in the fatty mouthfeel and in our case the ‘porky’ tastes and smell; we optimize the fat cells to provide a lot of that experience.”
'The plants provide texture'
He added: “The idea that you're going to have a fully cultured meat product, say 100%, that's going to be able to go to go into market at volume and at cost. I think that that's a long way away. It’s not that it’s not viable [per se], it’s just not viable today, and may very well be viable in a few years.
“But we’re very fond of saying, why use animal cells to solve a problem that plants have already solved in a much more scalable and affordable manner, at this point at least?"
'The biggest challenges are on the bioprocess scale up side'
So what still needs to change to bring down the cost of growing animal cells outside of animals, which proponents of the technology say should be inherently more efficient as resources are spent on growing only the cells that make up the meat product rather than maintaining the day-to-day activities of an entire animal’s body?
“The biggest challenges are on the bioprocess scale up side," said Spears, "so that's where I think a lot of new technology has come into play.”
'Some investors become anchored to the idea that there's a certain technology stack or approach to this market that makes the most sense'
So what has the most recent round of conversations with investors told him about how their thinking about this category is evolving?
“This round has taught us quite a bit about how investors think about the space," said Spears. "A lot of companies will have a very strong narrative of why their approach is best, and if an investor has spoken to a few of those companies, then they're going to come from those conversations kind of anchored to the idea that there's a certain technology stack or approach to this market that makes the most sense.
“So oftentimes it can be a frustrating conversation when investors come in wanting you to be that company.”
Quizzed on whether it makes sense to reproduce (albeit more ethically and sustainably) a product that many commentators believe is fundamentally unhealthy (processed meats) rather than encouraging consumers to reduce meat consumption or switch to plant-based alternatives, he said: “Our goal is to show consumers that what they're eating is the meat that they know and love.”
For people that want something different, he said, there is no shortage of alternative options, plant-based or otherwise.
Asked for his response to a recent interview in which Dr Pat Brown, founder of plant-based meat company Impossible Foods, described cell-cultured meat as “complete vaporware” that “will never be done with anything remotely like the economics you need for food,” Spears said: “Our unit economics even at launch are very good because of our unique approach.”
He added: “I think a lot of his argument hinges on, 'Wow, there are so many challenges, and I know, as I've done cell culture before...' and he’s right, there are a lot of challenges.
“But we now have an entire ecosystem of companies [to support the growth of cell-cultured meat]," said Spears.
"We're contacted almost on a weekly basis by another company making growth factors in a new and novel way that dramatically bring down the price, or companies offering dramatically cheaper media prices, or developing new bio reactor technology and bioprocess technology, so we don't have to solve all the problems [in-house].”
'We need the technology to evolve in ways that we don't exactly understand yet'
At last week's Good Food Conference, which coincided with the publication of a lengthy article in The Counter arguing that cell-cultured meat faced "intractable technical challenges at food scale," successive speakers acknowledged that higher-density cell cultures, more efficient use of food-grade media, food-grade equipment in facilities, and significant cost reductions in recombinant protein and growth factor production were needed for this technology to be commercially viable at scale.
However, “extrapolating early models into a definitive stance on scientific or economic viability will cause missed opportunities to invest in paradigm-shifting technologies,” argued GFI VP communications, Sheila Voss.
Friederike Grosse-Holz, director at private equity firm Blue Horizon, which has invested in multiple startups in the alternative protein space, added: "We still need technical advances. We need the technology to evolve in ways that we don't exactly understand yet... and Tyler [Huggins from fungi-fueled alt meat co Meati Foods] referenced it as the black box, and cultivated meat is a black box as well.
"But do we believe it [costs] will come down? Yes. Do we know exactly how? Of course not, because we're jumping off a cliff and building the engine [for the plane we don't know how to fly yet] as we go, right.
"And I think this is how innovation has happened in the decades before... I mean nobody would have been able to tell you in 1905 what a car was going to look like."
Stay tuned for more on the GFI conference on FoodNavigator-USA in the coming days...
*Other backers include SOSV’s IndieBio, TechU Ventures, ff VC, and Siddhi Capital. Hanwha ranks among the largest conglomerates in South Korea.