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QZ&A

Aleph Farms wants to grow you a steak

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By Chase Purdy
Rehovot, IsraelPublished Last updated This article is more than 2 years old.

A new kind of meat will soon enter global markets.

It’s not a fancy plant-based product, made from soy or potatoes or black beans. Rather, it’s made from the cells of animals, grown in industrial bioreactors into fat and muscle tissue to create what, on a molecular level, is real meat. The process is allegedly better for the planet than traditional farming, involves no animal slaughter, and circumvents the need to use medically important antibiotics for livestock.

More than two dozen companies around the world are building technologies to create this new kind of meat—often called cell-cultured meat—with nine of them leading the way. And at least three of those leading companies are in Israel.

In total, investors have put more than $73 million into cell-cultured meat technology since it emerged as a potentially-viable commercial industry in 2015. The vast majority of that investment, $50 million, was made in 2018 alone, indicating that overall interest in cultured meat is rapidly growing.

The money hasn’t just come from wealthy vegans, sunny-eyed billionaires such as Bill Gates, and the typical community of Silicon Valley venture capital firms, either. The list of investors also include global meat industry players such as Cargill, Tyson Foods, and PHW Group—some of whom have stopped calling themselves “meat companies” and have shifted to using the term “protein companies.”

 

In mid-May, Israel-based Aleph Farms announced it raised close to $12 million in Series A funding from a blend of investors that included, perhaps most notably, Cargill. That firm is a massive American company, with an annual revenue just shy of $115 billion. It’s also the world’s number-three meat producer after Tyson Foods and Brazilian meat conglomerate JBS.

What makes Aleph Farms particularly interesting to companies like Cargill is that it isn’t just making cell-cultured meat—it’s working on cell-cultured steak.

While most cell-cultured meat companies focus on ground meat products like hamburgers, chicken nuggets, and ground sausages, it’s much more difficult to get cells to grow in a way that forms a full cut of meat, such as a steak or chicken breast. In this, Aleph Farms is an industry pioneer. Quartz sat down with the company’s CEO, Didier Toubia, at the new headquarters just south of Tel Aviv, Israel in Rehovot to have a conversation about the state of the company and the direction in which it’s going.

Quartz: What can Aleph Farms do today that it couldn’t do a year ago?

Didier Toubia: When we did the first phase of our development at the end of last year, we actually completed the proof of concept on our capabilities for growing a steak, which is unique to Aleph Farms. We published our first prototype of a meat cut, which is made of various cell types growing together. We are using a scaffold for our tissue engineering—we’re the first company to use a scaffold in our product. We’re still refining the scaffold and developing our own serum-free medium.

We expect to complete those aspects of our development in two years, toward the end of 2020. Then afterward it may take about two years to move that product to actual production. We might have some limited launches in-between in limited quantities or in one restaurant.

Timetables can, of course, always change, but four years sounds pretty short for what you are proposing.

Yeah, still it will not be a full-scale, global launch in four years. Again, we are working on building up on our first production capabilities. I assume it will not be a very large-scale start.

When you say your proof of concept is currently composed of various cell types, what does that mean?

It’s various beef cells. Meat is not just made from muscle fibers, but also blood vessels, fat, and connective tissue holding all the muscle and the meat together.

You have a mocked-up label that says “slaughter-free steaks, real bovine meat.” It’s a little more long-winded and nuanced than some of the other terms I hear being kicked around…

Everyone is using different terms. We don’t use ‘clean meat.’ Some are using ‘cell-based’—which no one likes. I like ‘slaughter-free.’ It’s factual. There are two ways to produce meat, with slaughtering animals and without slaughtering animals, so it’s very clear. You know with “cell-based” meat, if you don’t know the field then you don’t understand what it means. Even with “clean meat” you don’t know what it means. Is it meat that has been washed? You have to know what it is about to understand the term. Slaughter-free is pretty bulletproof in understanding what it means, and it conveys the key difference.

When you think about exporting really good ideas internationally, it can be really difficult. How easy do you think it will be to take your technology and appeal to the US, Europe, and China. Do you think you’ll focus on the US first? China?

It’s a good question. Currently we’re building our go-to-market strategy. Hopefully by the end of this year we’ll make a decision on where we’d like to focus first. We’re currently still looking at different geographies and opportunities. So, we don’t know yet.

Walk me through if you went to the US or China first, what would the pros and cons be?

If we go to the US, the pro is that marketing will probably be easier because there’s more openness and awareness around this issue, especially on the West Coast. It looks like there is a real effort by the regulatory authorities to clear cultured meat and make it happen. In China regulation might be difficult.

On the other hand, I think the lobbies in the US are very strong, and you’ll probably have to work with large companies to go to market and to have enough critical strength and weight. And the US [market] is mainly hamburgers and we don’t do hamburgers. We do meat slices. And food culture in Asia is very fitted to our thin-slice meat.

In Asia—I believe especially in China—the governments want to implement cultured meat technologies, so it could be very big very fast. They might want to push cultured meat for food security purposes, which would allow them to make more meat inside of China instead of importing beef from abroad.

You’re in a new location; how is the company growing?

We just hired three people and we’re in the process of hiring three more. This is one of the reasons we moved to the new location. Half of the space is dedicated to the labs. We have five.

One of the key differences between the Silicon Valley companies and the Israeli companies is that the government actually helps nurture Israeli startups with grants. At this stage are you still getting government support?

We got some grants through The Kitchen Hub, which is an incubator which co-founded the company with me. Recently we don’t have grants anymore, we might apply for more traditional grants in the future.

In the future, are you looking at branding an official product under the Aleph Farms label, or are you looking at licensing your technology to meat companies to make the product on their own?

We’re open to partnerships with the different food companies. We’d like to keep some control over the product and probably won’t just license out the technology. Companies can co-brand products together. It would probably be a partnership.

There are two movements in cultured meat world: One relies on partnering with large meat companies to create meat and scale up the food technology fast. The other is more decentralized and works with farmers, who might produce the meat in a more localized way. Is that on your mind?

I think it should be both. Start with the large companies—they have a lot of marketing power and educational power. That’s more standard because it’s a completely new industry. It would be very challenging to succeed on our own. There are pros and cons to partnering with big meat companies, but at the end of the day we have to make sure we succeed in our mission and we have to do what’s needed to be successful.

And then with the farmers, all of those big companies are working with them. So I don’t think it’s an either/or. I believe that the production can be decentralized and on farmers’ sites. Farmers can be part of the revolution. We’re providing additional tools and options to produce more meat of good quality and solve some of the issues of the meat industry.

Do you think Israel is the future of food?

I think Israel is developing some of the most important solutions for the future of food. I think there are also interesting things going on in other parts of the world, obviously. But I think Israel is building a really competitive edge with agriculture food technologies.

What about Aleph Farms makes it special in this still very small cell-cultured meat space?

I think the first unique aspect is our ability to grow meat cuts, not just animal protein or cells, but to grow real slices of complex muscle tissue. That’s really our claim to fame, I think we’re a couple years ahead of the competition. That being said, it also positions Aleph Farms as a more premium-product company. Also there are only probably three companies in the world working primarily with beef.

When you’re talking about premium, it wasn’t that long ago that news broke that one of your competitors, San Francisco-based JUST, is partnering with a kobe beef farm in Japan. What were your thoughts about that?

I think it was mainly a PR thing. What makes kobe unique is the fat. I don’t think growing muscle fibers from Waygu beef or Angus beef makes a difference. When it grows in vitro outside the animal in the same growth medium and the same growth conditions, you’ll get more or less the same outcome at the end of the day. Doing hamburgers from those cells makes even less difference.

What about growing the fat tissue, though?

I don’t know if they intend to grow fat from Waygu beef. Maybe they’re working on that. Again, it’s nice, but I’m not sure to the extent that it gives them an actual and real competitive edge over other companies. I think growing fat is not a big issue. I mean, we do that and other companies do that.

People are starting to ask, is this food technology actually better for the planet? We don’t have any life-cycle analyses from any of the cultured meat start-ups. Do you think this poses some problems for the industry?

We plan next year to begin working with partners in Europe to study the sustainability of cultured meat. Most of the the studies that have been published so far are based on some theoretical processes and they show an advantage to cultured meat. What is clear is that cultured meat will use less land and water. It’s also reducing the use of antibiotics. We can also reduce the occurrence of food-borne illnesses just because don’t have the slaughtering phase. We solve all of the animal welfare issues. In terms of carbon footprint, though, we do still have to validate it.

The success of Aleph Farms is owed, in some degree, to the Israeli government itself, which supported the founding of The Kitchen Hub, an incubator of startups with big ideas. The incubator is part of the Israel Innovation Authority, which has a startup division headed by Anya Elday.

Elday says she recognizes that one of the biggest hurdles for cell-cultured meat companies are the regulatory ones. Given that the government goes out of its way to support startups within Israel, she said her department will likely work closely with other government ministries to help resolve some of those issues by the time companies such as Aleph Farms are ready to get to at least the Israeli the market.

“I really, really hope that we’re smart enough to be there, because we should be,” she said.