Just twenty years ago, you would have been lucky to walk into a supermarket and find soymilk in its bleak rectangle shelf-stable box. The same was true for a veggie burger—the underwhelming selection of bean or soy patties didn’t offer more than a choice or two, and other than Tofuurkey or Eden Soy, you were basically out of luck.
A lot has changed since then. Plant-based foods have reached an inflection point. There is growth in nearly every plant-based category at the market: meat alternatives, chicken substitutes, sausages made of pea protein, crumbles that masquerade as beef for your pasta sauce or taco filling, tuna from chickpeas and so much more. The pandemic has only accelerated the growth in plant-based foods, as nearly 25 percent of all US consumers have embraced plant-based foods on a regular basis, even as they don’t define themselves as strictly vegan but are instead moving toward a more plant-based diet with healthier flexitarian habits, better for human health and better for the planet. One of the key reasons for the mass acceleration of plant-based products—especially plant-based proteins—is the fast-forward innovations coming out of the lab, otherwise known as food technology.
Now innovators are printing meatless steak with 3D printers and companies are creating foods that will never need animals to sustain human tastes and protein needs. Israeli startup Redefine Meat is working to creating a meatless steak using 3D printing, as the meatless food industry is expected to hit $8 billion in sales in the next five years, according to Business Insider. Recreating the texture of lean meat has been the Holy Grail of these new technologies but Redefine Meat is not the only one trying to do it with 3D printing technology as Novameat, based out of Spain, is also experimenting with this approach. The time is ripe for these new food systems to offer consumers healthier, more planet-friendly choices as pandemic-driven meat shortages and COVID-19 outbreaks in several large meat processing plants made consumers wary of meat supplies and ever more open to tasting alternatives such as Beyond, Impossible and more.
Food Tech is shaping the way we shop, eat, and think about meat and dairy alternatives
This emerging sector of plant-based innovation and production is so significant to the economy that it already represents a multi-billion dollar industry, and in the past year, as traditional dairy companies have foundered and closed, those based in plant-based proteins like Oatly and Miyoko’s Creamery, Califia and Blue Diamond have expanded, as more consumers are turning away from the hormone-laden fat-filled planet and animal unfriendly cow’s milk and opted for vegan-friendly heart-healthy options like almond milk, or milks made from pea, hemp, cashew, and oat proteins. Meanwhile, the market for non-dairy coffee-creamers is exploding, as is consumer demand for non-dairy butter spreads, hard cheeses, eggs, and especially non-dairy ice creams.
This burgeoning plant-based industry category, VegTech (a term I first coined in an interview on the Plantbased Business Hour podcast and Facebook Live show) shows no signs of slowing down. Vegtech companies are food technology companies creating plant-based meat or dairy products. At their core, VegTech companies are hyper-focused on creating foods that are not thought of as just swaps, substitutes or alternatives, but as more desirable, healthier replacements for animal-based foods that are known to cause inflammation, a higher risk of heart disease, diabetes, weight gain and other lifestyle diseases. The defining characteristic of VegTech plant-based options is their ability to be nearly indistinguishable from animal-based natives, but also better for you, or the planet, or animal welfare. This makes them more desirable to consumers concerned with any or all three.
VegTech companies are often built similarly to software companies, with a Chief Technology Officer (CTO) at the helm of product development, and a “build fast and break things” approach. They establish locales in tech-hub cities like Seattle, San Francisco, or the Bay Area and they emulate tech-centric product development cycles while attracting big-tech money.
As more traditional food companies enter the VegTech sector (Nestle is doubling down on the development of its plant-based food in the form of meatless offerings from Stouffers and DiGiorno, as are big food makers like Conagra have bought in by purchasing Gardein which has quadrupled in size in the four years leading up to 2019 and growing its footprint to become the second-largest meat-alternative company after MorningStar). Smaller players are attracting mammoth investments, as the plant-based food evolution—and revolution—is rolling full-steam ahead. VegTech companies are helping usher in a new era of plant-driven foods that appeal to the masses, making your food choices healthier, cheaper, and less damaging to the planet at every new innovation.
For consumers, this food innovation means better tasting products, available in more places—retail, food service, and direct-to-consumer–at a price point that will rival, and eventually be lower than, animal-based products. Humans and the planet have a lot to gain from this emerging sector, as we are just beginning to ascertain the potential of what will be one of the most influential industry sectors in modern history.
Vegtech Companies at the Helm of Plant-Based Innovation
When you envision VegTech innovation, you might imagine people in lab coats, growing protein in Petri dishes but at least for now, 3D printing notwithstanding, innovations have been more likely to come from old-fashioned trial and error than Eureka discoveries. Josh Nixon, Chief Technology Officer (CTO) at Prime Roots, a Bay-area startup focused on innovation in the plant-based protein space, explains that technology often has to do with ingredient innovation, meaning mixing in new elements. Having a goal of where you want to end up, in terms of taste and texture, and adding new ingredients to reach that goal. Prime Roots is using a berry called Koji to create plant-based meat products that are the right color and texture to satisfy traditional tastes. “Koji has not been used before to create texture and primary protein,” says Nixon. “We’ve taken this 8,000-year-old Japanese superfood and repurposed it.” Nixon says that production looks more like a brewery or a kitchen than a lab, and their innovation looks “more grounded to earth in solving problems this century.”
Nugg is another food company with technologists grounded in this century. Founded by tech entrepreneur Ben Pasternak, who brought in Thierry Saint-Denis, former senior director of research and innovation at Danone, as Nugg’s CTO, Nugg’s keystone product is “chicken” nuggets. Chances are you’ve seen their ads in your Instagram feed. As the “Tesla of chicken,” as the company calls itself, they use “advanced soy protein technology that enables a hyper-realistic simulation of the texture and flavor of an animal-based nugget.” And currently, they are on version 2.0.
Bay area-based Eclipse ice cream prides itself on a non-dairy option that they claim is indistinguishable from dairy ice cream. “While our ice cream was created in a kitchen, not a lab, we’ve discovered a blend of plants and a revolutionary process that allows us to unlock the magic of milk in a plant-based milk,” says Eclipse Foods CEO Aylon Steinhart. “We are able to create indistinguishable dairy products from plants because we’ve discovered microscopic structures called micelles that allow dairy milk to turn from liquid (milk) to semi-solid (cream) to solid (cheese).” Recreating these micelles in their milk enables them to create a plant-based, non-GMO ice cream doppelganger. Their ice creams are also equivalent to dairy products in terms of protein and calcium, but are allergen-free, and have almost no cholesterol or saturated fat found in conventional dairy.
Another major plant-based player in the VegTech space is JUST Inc., known for their JUST Egg product that uses mung bean to recreate the protein, texture, and taste of egg without all the heart-clogging cholesterol or the suffering of caged birds. They manipulate the mung beans to make an exact replica of liquified eggs for scrambling, omelets, and delicious other recipes such as French Toast or vegetable quiches.
And of course, there are household names like Beyond Meat (NASDAQ: BYND), one of the first modern-day VegTech companies, founded in 2009 that has changed the way people think of plant-based meat s (no longer the stuff of tree huggers but of mainstream America, especially when it comes to Dunkin’s Beyond sausage sandwich). Beyond uses technology to transform pea protein into meat-like burgers, meatballs, and more. Their constant innovation is leading to better-tasting beef replacements, a better nutritional profile, and lower cost for the consumer.
Impossible Foods is another major player and perhaps best epitomizes a VegTech company, as their CEO Patrick Brown recently said on Mad Money that the meat industry will be obsolete in 15 years. Their innovation comes in the form of heme, a molecule found in blood that carries oxygen to the cells, and which gives red blood cells their color. Heme is what also gives Impossible meat its realistic smell and look (but turns off some vegans). Using a heme-containing protein that is also found in plants, Impossible Foods makes a burger that looks, tastes, and is in many ways so close to the real thing, that most people in a blind taste test would never guess it’s made of vegetables.
Based in Silicon Valley, Impossible Foods looks more like a traditional tech company than a food company; their latest products, Impossible Sausage and Pork, were introduced a year ago when actual events were still being held, at the Consumer Electronics Show (CES) in January 2020. CES is the country’s largest technology event, not a food expo. Impossible continues to pull in investments, raising $1.3 billion since it was founded a decade ago.
Vegtech Hype vs. Reality: Cellular Agriculture (“Clean Meat”)
Some technology has come under fire for “over claims” that it’s healthy, clean or better for the environment. This is especially true of cellular agriculture (aka “cell ag”) and some companies tout their proteins as “cultured meat” or “clean meat” or “lab-grown meat.” So far, cell ag is still in its infancy. These companies are aiming to make animal-like foods without the animals.
While heralded as a technology that will revolutionize food and eliminate environmentally-destructive animal agriculture, no cell ag products have reached the market, yet. Questions remain, including the high costs of development, regulatory and health concerns, plus people’s psychological acceptance of lab-created meatless meat. A study from the University of Sydney and Curtin University found that 72 percent of Generation Z (anyone born between 1995 and 2002) would not be interested in eating lab-grown meat, even if it means eliminating the need to slaughter animals. Despite this, big money is being poured into cell ag.
One cell ag company, Memphis Meat, which has attracted high-profile investors like Bill Gates, Richard Branson and giants Cargill and Tyson Foods, has “cautioned the industry around releasing a product too soon, stressing the need to make it right, or risk tarnishing the image of the industry for years,” according to an interview with MarketWatch. The company has though demonstrated their proof of concept, making cultured chicken nuggets and beef meatballs, as well as duck tissue ini the lab. BlueNalu in San Diego, Calif, has also shown it can make fish meat from fish cells (obtained by swabbing skin tissue). The living cells are isolated and placed into a solution to proliferate. The end product is a fleshy substance that is biologically identical to meat. The company demo’ed its bluefin tuna fish meat last year.
A question remains as to whether or not cultured-meat is considered vegan by those who eschew animal products; it might depend on how cells are obtained. While no animals are slaughtered to make lab-grown meat or dairy created in large drums in a lab, the cells needed to make the “meat” product still need to come from animals. The health concerns are still relevant if that meat or dairy contains saturated fat known to increase risk of heart disease.
The bottom line is, we are still a ways away from cellular agriculture-derived foods that are bound to be lining the shelves at the grocery store or being served at your local sushi joint.
Fermentation, the Next Plant-Based Frontier
Fermentation is a lesser-known, but highly important, pillar of plant-based food innovation. Fermentation uses microbial species to produce or transform a food product or ingredient. Fermentation can be harnessed in a lab to produce cultivated meat, eggs, and dairy, or as a primary protein source.
Fermentation technology is already delivering next-gen sustainable and efficiently-produced plant-based meat and dairy products with more on the way. Fermentation companies raised 435 million in 2020, according to the Good Food Institute, which was about one-third of what plant-based meat, egg, and dairy companies brought in.
The fermentation industry’s darling is now non-animal dairy company Perfect Day, which raised $300 million in a Series C. Perfect Day uses microflora (a microorganism such as bacteria, yeast, or in their case, fungi) to make proteins based on starter cells from animal proteins. They use fermentation tanks to grow flora and develop milk proteins that serve as the basis of their dairy products like ice cream and cheese. “We use fermentation to make the foods people love while delivering the same taste, texture, and nutrition as conventional dairy without the environmental, food safety, or welfare concerns,” says Perfect Day CEO and Co-founder Ryan Pandya. “But that’s just the start. By working with food and dairy companies to bring a new category of animal-free products to market, we’re building a next-generation supply chain to provide more nutritious, scalable options globally.”
Fermentation shows promise for the potential of greater scale, at a lower cost, with improved efficiency, and enhanced sustainability, the company argues. “The opportunity landscape for technology development is completely untapped in this area,” says Good Food Institute (GFI) Associate Director of Science and Technology Dr. Liz Specht. “Many alternative protein products of the future will harness the plethora of protein production methods now available, with the option of leveraging combinations of proteins derived from plants, animal cell culture, and microbial fermentation.”
Plant-Based Food at Scale. VegTech Does Three Things Better Than Anyone Else
What the current product-in-market VegTech companies have done well—and continue to improve on—is tackling the three factors critical to ushering in plant-based food adoption: Availability, price, and taste. As these companies scale, availability will continue to increase, the prices will continue to go down and taste will continue to get better. The question remains, however: Are plant-based meats better for you than the real thing? Dr. Kim Williams, Head of the Cardiology Department at Rush Medical Center in Chicago, and Past President of the American College of Cardiology weighs in with a warning about sodium content, saturated fat, and overall habit-forming patterns. Essentially, he nets out that they are great “gateway” foods that work to convince consumers that they can live without relying on a diet of meat and dairy, but ultimately a whole-food plant-based approach, free of all oils and additives, is still best when considering your health.