Lab-produced meat could also be one of the stranger sectors for startup innovation. But in terms of funding and hype trajectory, this is as typical because it gets.
The boom in space investments coincided more or less with the peak of the boom. Cultured meat corporations earned greater than $1.6 billion in 2021 and 2022, in keeping with a Crunchbase evaluation. Leading names comparable to Dishes a plus, Believing meat AND Good Meat they used over a billion between them.
This generous streak of funding has coincided with a period of heavy investment in plant-based meat and dairy substitutes. Largest private funding recipient, fake meat unicorn Impossible dishesraised almost $2 billion. And rival Apart from meat after its 2019 initial public offering, it was a stock market darling for about two years.
However, like most startup sectors, the alt protein space is not attracting investors prefer it once did. While funding has not completely dried up, it has declined significantly.
Big rounds are falling
Nowadays, we not see rounds numbering in the a whole bunch of hundreds of thousands in space. More broadly, cellular meat and plant-based protein corporations have declined in each frequency and size.
To illustrate this, we calculated $20 million or more in funding to corporations in the alternative meat and dairy industry from 2019 to present:
This 12 months, by far the largest round took place in Boulder, Colorado Meat, which creates cutlets and steaks from mycelium. Raised $100 million in a C-1 round led by Grosvenor Food and AgTechbringing total funding since its inception in 2016 to just about $375 million.
The next largest financing went to a company based in Barcelona Heura’s foodproducer of plant-based meat and fish, which earned $40 million in February’s Series B. Its range includes vegan variants of popular Spanish dishes comparable to ham and chorizo.
We also saw two big rounds last week. Based in London Thisa maker of plant-based chicken and pork substitutes, raised $25 million in Series C financing. And Somerville, Massachusetts Delicate foodwhich produces plant-based versions of meats comparable to chicken cutlets and pulled pork, raised $11 million in a Series A round led by Partners of the Rhapsody enterprise.
It’s price noting that none of the largest funding rounds went to startups focused on cultured meat or meat grown in a lab from animal cells. But it’s difficult to pinpoint a single cause for the slowdown, as startups in the industry have faced a variety of hurdles – including technical issues, questions about likely consumer adoption repulse from politicians and regulators.
Plus, bringing it to market is an expensive proposition. One recent example that did not work out was a company based in the San Francisco Bay Area SCiFi foodWhich closed shop after raising near $40 million in known financing. The company sought to mix plant-based and cultured meat to create a cheaper alternative to the burger.
Option overload
Given the sheer variety of funded alternative protein startups (yes, there are many), we will expect greater difficulty in securing continued funding and ultimately the company’s closure. While this is the case in most startup sectors, the interest in alternative proteins signifies that these failures are more likely to be more visible than in other industries.
Cultured meat in particular appears to be being cut excessively. While this will likely still be a laudable goal, given the ethical and environmental issues associated with animal agriculture, the economics is not going to be easy.
Fortunately, even with the start-up field clearing out, consumers craving plant-based meats still have loads of options to decide on from, including imitations of all major cuts of meat and seafood, in addition to more processed favorites like lunch meats, bacon and sausage .