This article was sponsored by CULT Food Science.
As the year comes to an end, 2021 has been another record-breaking year for cellular agriculture investments. Despite the economic impact of the coronavirus pandemic over the last two years, the cellular agriculture food landscape pushed through and achieved many significant milestones.
After the cellular agriculture food field reached the milestone of $1 billion in total investments as of summer 2020, the cellular agriculture field pushed forward and raised approximately $2 billion in investments in 2021 alone. With more than $3 billion now invested in the field, the incredible total highlights how the field is growing globally to address many of the challenges in our global food system.
As new investments continue to flow into the cellular agriculture field, many more people are exploring how to invest and be part of the novel food field. While the first cell-based meat and dairy companies went public in March 2021 and April 2021, respectively, most cellular agriculture food companies remain private.
CULT Food Science is a new investment platform exploring the future of food with cellular agriculture. As of January 17th, CULT Food Science is publicly listed on the Canadian Securities Exchange under the symbol 'CULT'.
Having invested in startups like Biftek, MeliBio, Eat Just, and Novel Farms, CULT Food Science has invested in a wide range of cellular agriculture food companies and aims to support the broader cellular agriculture ecosystem.
According to CULT Food Science CEO Dorian Banks, the team came together to explore the cellular agriculture field following the rise of plant-based meat companies and the growing investments in alternative proteins.
“We started to follow Beyond Meat and Impossible Meat a few years ago, and that led us to explore what the next disruption would be within the food ecosystem. That led us to stumble upon the cellular agriculture field, which we view as the future of food. We started to see some very prominent entrepreneurs and venture capitalists in this space, and, as such, we assembled our diligence team.
“Since then, we started to look at deal flow upwards of 75 different types of investments. This field is truly the disruption to the traditional food industry as we know it. As such, we want to astutely deploy capital and build this fantastic investment platform that is CULT Food Science.”
While the team may have first explored the cellular agriculture field through the success of plant-based meat alternatives, the CULT Food Science team is focused on investing in companies using cellular agriculture to use cell culture technology to produce animal products.
“The future of food, in one word, is exciting. And we look to participate in this revolution."
“We're focused exclusively on cell ag. We do not entertain anything plant-based. We think that plant-based foods have high potential, but we feel it's becoming a saturated marketplace. We also want to be a differentiator for our current and future investors. Therefore, we're only going focus on the future of food with cellular agriculture.”
Through its investments in the field, CULT Food Science aims to develop an investment platform around the novel foodtech field. “We're developing a cellular agriculture platform through aggregating a diversified investment portfolio. We have gained exposure to various cell ag companies, including meat, honey, and certain structuring and growth media companies.
“In short, we're assembling a diversified portfolio, so that investors can gain exposure to all the fantastic new developments through the purchase of our equity. In addition to that, we’re focused on creating a great media engine. We have a fantastic brand and working to amplify our mission on social media.”
By becoming a publicly traded investment platform, CULT Food Science ultimately aims to democratize access to the future of food field for retail investors. “Many of these companies, whether just starting out or with a $250+ million market cap, are very protective of their cap table. They're also looking for a certain check size in order to participate.
“Funding has become incredibly competitive within this space. For your mom and pop on Main Street, they struggle to write their own checks into these companies. CULT Food Science can act as a proxy.
“Through the purchase of our stock, which will be trading on the Canadian Securities Exchange this year, everyone can gain exposure to these companies that we have already done due diligence on. We are already on the cap tables of these companies. As such, we are increasing accessibility and affording everyone the opportunity to participate in the future of food and this fantastic cell ag revolution.”
From investments in Cell Ag Tech in Canada to Mogale Meat in South Africa, CULT Food Science has invested in cellular agriculture startups around the world. Moving forward, Banks shared the investment platform aims to continue investing globally in both new startups and established cellular agriculture companies. “We would love to have an investment in every country and on every continent. And the reason is that food is a global issue.
“Food insecurity impacts people not only in North America, in our own backyard, but on every continent. And we view cellular agriculture really as the future of food, not only from an environmental perspective but from a distribution and availability perspective.
“We think that there are fantastic entrepreneurs in every corner of the world. And as such, we're not limiting our investment portfolio just to North America or just to Europe.”
Banks shared that CULT Food Science’s ultimate goal is to develop the most diversified cellular agriculture portfolio. “We have looked at over 75 different companies as we are very committed to a diversified portfolio. We want exposure to a range of cellular agriculture products, such as dairy, and premium and gourmet products like foie gras and Iberian pork.
“We also want to participate in investment rounds of key players and thought leaders, such as our recent investment in Eat Just.”
From investments in cell culture media startup Biftek to cell-based meat scaffolding startup Novel Farms, it’s notable that several of CULT Food Science’s portfolio companies are working to address critical scaling pain points for the cell-based meat industry. By addressing these challenges through their products and services, these companies can develop a whole ecosystem and value chain around the cellular agriculture field.
"At the end of the day, this is the most exciting thing to happen since formal agriculture way back in the Mesopotamian days."
“We’re very bullish [on supply chain players]. We want exposure to the picks and shovels component of this industry, like the growth media and the scaffolding. We view that all as very important. We're also looking to aggregate companies of various maturity levels and sizes. We want companies that are sub $10 million market cap because of the high amount of leverage.
“It's our focus on diversification. It's our focus on removing or lowering those barriers to entry and democratizing access to this industry to the general public.”
From scaling production to regulatory approvals, there are still many challenges that the cellular agriculture field will need to address to come to market. From the investment platform’s point of view, Banks breaks down the two main hurdles as economics and public perception.
“I put [the challenges to come to market] into two main buckets. The first bucket is economics. It needs to be economically viable. You need to be able to go to the store and buy a [cell-cultured] pork chop or a T-bone steak and be relatively cost-competitive. It does not have to be on the same scale as an Alberta, Triple-A steak, but it needs to be relatively competitive so that the consumer can vote [for this field] with their wallet.
“Secondly, regulation aside, it's going to be public perception. It's going to be removing misconceptions, removing this information, and focusing on younger populations that are very open to adopting cell ag types of foods within their diets if you look at the polls.
“So we view it as twofold. For economics, you have to be price aware and price conscious. You also need to work tremendously hard to change public perception, whether it’s through collaborative media campaigns or other channels, and help educate the populous because this is very novel, and most folks feel slightly intimidated. Let’s not allow them to be intimidated anymore.”
"For your mom and pop on Main Street, they struggle to write their own checks into these companies. CULT Food Science can act as a proxy."
Moving forward, Banks predicts that more cooperative initiatives will be essential for the field’s success. “I think collaboration is key. There needs to be industry foundations and groups that are helping educate the public.
“I think healthy competition is important for advancements, especially technological advancements, but when it comes to public perception, this needs to be a wholesome effort by all the leaders in the industry. We’re rowing the boat in the same direction around knowledge and education.”
Through the year, there have been many partnerships between established companies in the food and agriculture industry and cellular agriculture startups. Following the acquisition of Spanish cell-based meat startup BioTech Foods by Brazilian meat giant JBS, Banks believes that acquisitions may be a way for food corporations to be further involved in the field.
“You’re going to see a lot more consolidation. If you read through Tyson’s and Cargill’s financial statements, they’re committing serious research capital towards cellular agriculture.
“There’s going to be a certain land grab - like a massive traditional food player is going to scoop up a large percentage of a leading cellular agriculture player. And the reason why they are going to consolidate is that cellular agriculture is a competitive threat.
“For these traditional food companies, it’s going to be quite impressive if they can find the right cellular agriculture companies that have carved out a defendable niche and will be a complimentary bolt-on for them.”
Beyond food products like meat and dairy, cellular agriculture can make a wide range of animal products, from pet food foods to biomaterials. According to Bank, the CULT Food Science team is also exploring these broader applications of cellular agriculture.
“We certainly are looking at ancillary areas - anything that can protect animals. Keeping in mind that it's our goal to provide the most diversified and well diligence portfolio to our investors, we are looking at other areas like biomaterials.
“For example, we are looking at [cell-cultured] leather. We even started to look at certain alcohol plays. I think we'll be willing to bring anything under our umbrella because there's some very exciting work going on.
“Personally, I would love it if there was a [cell-cultured] shark fin soup company. That's a big marketplace. I understand there are cultural challenges, but anything to protect endangered species we'd be willing to back and diligence.”
“It's our focus on removing or lowering those barriers to entry and democratizing access to this industry to the general public."
At the same time, similar to cell-based food companies, Bank acknowledges there will be similar challenges for biomaterial companies to scale production and come to market. “It’s all going to be a function of capital as is most things.
“I think these textile plays are going to be a function of being economically viable more than anything else. In addition, similar to cellular agriculture foods, it's going to require a concentrated media campaign to help folks understand why it's better [than conventional materials], and why they should be looking to choose something that's from cellular agriculture.”
From the first regulatory approval of cell-based meat at the end of 2020 to more companies entering the field, Banks and the CULT Food Science team is optimistic about the field in its nascency. “The future of food, in one word, is exciting. And we look to participate in this revolution.
“We’re really in the second or the third inning [out of nine] here in the cellular agriculture field. There’s a long [base]ball game to play out. At the end of the day, this is the most exciting thing to happen since formal agriculture way back in the Mesopotamian days.
“The future of food is here. We want to participate. We want to be a leader and, as such, we’re going to continue with our mission.”
Moving forward, CULT Food Science plans to become a publicly-traded entity as of January 17, 2022. The move would allow CULT Food Science to bring on more retail investors as well as return capital to its existing investors.
“Our plans moving forward are we are going to trade on the Canadian Securities Exchange [on January 17th]. That's going to be a monumental event for us. We're very excited.
“Being a public company, we're an open book. Everyone can look at us. I would encourage people to go to our website and our SEDAR profile, to look at our filings.
“Moving forward, we're also going to deploy more growth capital. We're already looking at certain IP streaming and royalty opportunities. We're looking to lock up exclusive intellectual property and partnerships with some of these early-stage companies. These will differentiate us from just a fund or a capital deployment vehicle.
“We’re not just a fund. We’re a platform for the future of food.
“For anyone that would like to stay updated with us, I would direct them to our press releases. They do a great job at encapsulating our investments.”
Photographs by CULT Food Science.
This article was sponsored by CULT Food Science. For more information about CULT Food Science, please visit their website to learn more.
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