The lab-grown meat industry is facing significant challenges despite receiving $1.6 billion in venture capital funding. Since Mosa Meat introduced the first lab-grown hamburger in 2013, costing over $300,000, approximately 200 startups worldwide have aspired to replace traditional meat with cell-cultured alternatives. However, in 2024, the industry faces severe setbacks, causing multiple startups to scale back or shut down.
The goal of producing about 30 million pounds of lab-grown meat annually starkly contrasts with the over 100 billion pounds of traditional meat produced each year. Better Meat CEO Paul Shapiro, who authored “Clean Meat” in 2018, considers it “unrealistic” for cultivated meat to appear in grocery stores or fast-food menus in the 2020s. Shapiro emphasizes that even if the technology and funding were ready, building the necessary factories would take years, and the current funding environment is unsupportive.
Several companies have already faced financial difficulties. New Age Eats closed in early 2023 after failing to secure funds for its pilot facility. Upside Foods laid off workers and halted plans for a new facility. Aleph Farms let go of 30% of its staff in June due to capital-raising challenges. SCiFi Foods also shut down in June, with CEO Joshua March citing the inability to raise the required funds.
David Kaplan, a professor of biomedical engineering at Tufts University, notes that the biotech field, including lab-grown meat, is struggling due to economic downturns and cautious investors. Startups in this industry aim to address the projected need for 60% more food by 2050, driven by the expected global population of nearly 10 billion. Lab-grown meat offers a potential solution without the environmental impact of traditional meat production.
Despite initial promise, the industry still grapples with major obstacles. Companies produce meat from animal cells in bioreactors, but large-scale production and cost efficiency remain elusive. Regulatory approval is also scarce, with few companies meeting the necessary standards.
Venture capital funding has sharply declined, with $1.6 billion raised in 2021 and 2022, dropping to around $20 million by mid-2024. Lever VC managing partner Nick Cooney notes a significant reduction in investment due to the high upfront costs and uncertain profitability of lab-grown meat ventures. PitchBook data indicates a continuing decline in funding, with only 12 deals logged in the first quarter of 2024 and about 20 more potential deals in the pipeline.
To survive, some startups consider outsourcing cell manufacturing or seeking government funding. Countries like Singapore and Israel have already committed substantial funds to alternative protein research. Kaplan believes more governments will need to invest in cultivated meat to ensure its success.
Engineering hurdles persist, with companies like Eat Just and Believer Meats working to improve cell densities and reduce production costs. The cost of cell growth media and the construction of bioreactors are significant barriers, with cultivated meat currently far more expensive to produce than traditional meat.
Public perception is another challenge. Terms like “Frankenfood” and “lab-grown meat” hinder consumer acceptance. Founders like Wildtype’s Justin Kolbeck and Upside Foods’ Amy Chen emphasize the need for transparency, education, and regulatory clarity to build consumer trust.
The industry remains hopeful. Upside Foods’ Chen believes regulatory approval processes will improve, and consumers will eventually embrace cultivated meat. Lever VC’s Cooney points to portfolio companies achieving price reductions and production improvements. Eat Just’s approach in Singapore involves launching products with a mix of cultivated and plant-based proteins to drive down costs and build consumer familiarity.
Despite the hurdles, the lab-grown meat industry continues to push forward, seeking to overcome financial, technical, and regulatory challenges to revolutionize the food system.
