Billionaires Bill Gates and Richard Branson have an eye for identifying potential breakthrough opportunities and disruptive technologies. After all, they didn’t build their Microsoft Corporation and Virgin Group empires, respectively, without being willing to take some risks and go against the crowd. They have both invested in a startup company known as Memphis Meats which is using technology to reimagine meat production.
About Technology Disruptions
One term that has become increasingly popular is ‘disruptive technology.’ Why is this so important and seemingly attractive? A disruptive technology or disruptive innovation essentially creates a new market and disrupts the current market and its value chains. Change is inevitable and industries that resist change are at risk of being left behind. Disruptive technologies are important because they bring new ideas, new standards, new opportunities, and new benefits.
One of the disruptive technologies in the food industry includes vertical farms. For as long as people have been farming, farms have stretched outwards and taken up a lot of space. Vertical farms do not take up acres and acres of land as they are stacked vertically. There is a lot of technology and innovation that goes into this, and New Jersey-based company, Aerofarm, has built the world’s largest vertical farm. Some of the advantages of this include less land usage, efficient delivery of nutrients through aeroponic chambers, no need for sunlight or soil, 95% less water needed, and a yield that is 130 times that of traditional farming. Other food industry technology disruptions include a pocket-sized scanner by Israeli company Consumer Physics, called SCiO, which can be used to scan food and give the nutritional content. There is also a smart tent powered by solar energy by a Belgian startup called Wakati to extend the shelf life of fresh fruit and vegetables, especially in hot climates. There are also significant strides being made to incorporate leading technology in meat production.
About Memphis Meats and Clean Meat
Clean meat is an alternative term for cultured meat. Instead of the traditional route of slaughtering chickens, ducks, and cows to get chicken, duck meat, and beef, for example, clean meat is grown in-vitro from animal cells. If this industry really takes off, this can be quite a game changer and disruption in traditional farming the future.
Clean meat is not to be mixed up with genetically modified organisms (GMOs). They are completely different in that with clean meat, no genetic engineering is done. That means that there’s no inserting and altering the genetic make-up of the tissues. This fundamental difference is important because of the ongoing debate about the potential complications and risks of consuming food that has been changed genetically. Clean meat is safe in that respect and is considered as ethical meat production. Also, no animals need to be killed. There are no pesticide and tranquillizer chemicals to worry about, so compared with normal meat production, it should actually be safer. Because this is a budding technology, no long-term studies have been done. The cells to be grown can be extracted from birds’ feathers as stem cells, or by extracting myoblast cells from an animal’s muscle tissue. This is done using a biopsy, and this does not harm the animal or cause much discomfort.
Memphis Meats, as a company, is hoping to be a pioneer in making clean meat the new norm. They are based in San Francisco, California, and Uma Valeti serves as the M.D., co-founder and CEO of the startup. The other two founders are Nicholas Genovese and Will Clem, and the company was founded in 2015. They have already experienced success at the research stage in producing clean chicken, clean duck, clean beef, and even the first clean meatball, which they announced last year.
With the global meat industry being a trillion-dollar market and more and more calls being made for organic meat and environmental consciousness in farming, Memphis Meats believe they have a winning value proposition. They can meet a real consumer demand for a sustainable solution, and according to them, they only need a fraction of the land and water needed by traditional cattle and poultry rearing—1% to be precise. Their methods also produce 90% less greenhouse gas emissions which is a major environmental benefit. Memphis Meats are hoping to enter the consumer market in the year 2021.
They seem to have a clear vision of the way forward and they have been bringing in investors to partner with them in this. Some of the key areas they intend to focus on going forward with the additional investments funds include hiring more staff, scaling up their production, and bringing down the cost of producing clean meat. As would be expected, such a new technology-based solution would be pricey to begin with, but Memphis Meats is looking to reduce the cost to match that of convention meat and possibly have it even lower.
Memphis Meats has already received quite a lot of media coverage despite only about three years since being founded by three scientists. Fortune Magazine has covered their lab-grown meatball and the notable investments made by the company. Bloomberg and The Wallstreet Journal have also run pieces about the company.
About the Investment
Bill Gates and Richard Branson are among quite a diverse group of investors and investment firms who have come in on Memphis Meats’ Series A funding round valued at $17 million. This means that the company has now raised a total of $22 million in funding. Some other investors to note who have also jumped in on this exciting opportunity include Suzy and Jack Welch, Cargill, Kimball Musk, Inevitable Ventures, Atomico, New Crop Capital, Fifty Years, KBW Ventures, Kyle Vogt who is the co-Founder of Twitch, and SOSV, to name a few. DFJ, who has also invested in SpaceX, Tesla, and Skype, is also among the list of investors.
Speaking about his investment in Memphis Meats to Bloomberg News, Richard Branson expressed that he was “thrilled” by the opportunity. He believes that the future of Memphis Meats and the clean meat industry is quite bright. He foresees clean meat and plant-based meats being the standard in 30 years or so and with that, the end of animal slaughter. Branson also pointed out that this disruption in the market would not alter the taste of the meat but actually make meat consumption healthier. This is important because, with clean meat, there is more quality control and testing of the final product.
As already alluded to, Memphis Meats is certainly onto something major that could really disrupt the way meat is produced globally in the coming years. A lot has been said and written about the current state and challenges of animal rearing in terms of environmental implications, human health implications, and also issues to do with the treatment of animals. While many people are drifting away from meat consumption for various reasons and opting for vegetarianism and veganism, the market for meat has never been stronger. In fact, the global demand for meat is expected to double in the coming decades.
If clean meat becomes a viable option and the market begins to shift towards it, innovators like Memphis Meats could be well positioned to get a good chunk of the market. They are not without competitors, however. One of the companies in a similar space is Impossible Foods which produces plant-based meat and dairy products. They were founded in 2011 and are also based in California. Another company to mention here is Beyond Meats. This California company has been producing plant-based meat substitutes since 2009, and their products have been available nationwide through Whole Foods since 2013. Mosa Meat is a Dutch company and a direct competitor of Memphis Meats. The startup was founded in 2013, and that year in London, they presented the world’s first lab-grown burger in a news conference. The burger patty was worth $325,000 at that time, but they have since brought the price down to $11.
Memphis Meats CEO, Uma Valeti, has elaborated more on the vision of the company. He says that the challenges facing the current way in which meat is produced can be solved with the right partners working to develop clean meat. He also highlights the three major selling points of the products that Memphis Meats is working on—meat that is more sustainable, more affordable, and finally, more delicious.
Perhaps only time can tell how or whether clean meat can truly change the way meat is produced on a global scale. There are so many questions, and there’s so much potential. What happens to conventional farming in the future? What impact does clean meat have on the reduction of diseases that come from meat consumption and animal rearing? How low can the cost of clean meat really go? So many big names have backed the idea and appreciated the need for using the latest technologies in an industry with as high an impact as food production. This is definitely an exciting space to watch both now and in the near future.