Last week, Memphis Meats announced that they raised an enormous $161 million in their Series B funding round. Founded in 2015, Memphis Meats is one of the first startups to use cellular agriculture to produce cell-based meat. Cellular agriculture is the field of producing animal products, like meat, directly from cell cultures instead of raising animals for the same products. By growing animal cells that directly become meat, Memphis Meats can make the same meat that comes from animals. Without requiring the animal.
Founded by Uma Valeti and Nicholas Genovese, Memphis Meats provides a more sustainable and less-resource intensive way to produce meat. Based in Berkeley, California, Memphis Meats was the first cell-based meat startup to go through IndieBio, a leading life science accelerator in San Francisco, where many other cellular agriculture startups emerged.
Memphis Meats' cell-based meatball
Memphis Meats’ Series B financing was co-led by SoftBank Group, Temasek, and Norwest. The funding round also featured investors from Memphis Meats’ previous Series A round, including Bill Gate, Richard Branson, Fifty Years Ventures, Kimbal Musk, Threshold Ventures (formerly DFJ), and meat corporations Tyson Foods and Cargill.
The funding round brings Memphis Meats’ total funding to over $180 million. In 2017, Memphis Meats raised $17 million in Series A funding.
Memphis Meats is the first cell-based meat company to raise a Series B. It is also the largest round by any cellular agriculture food company. The previous largest round, Perfect Day’s $140 million Series C, was announced in December 2019. Memphis Meats’ funding round also doubles all the investments that have been made to date in all the cell-based meat companies.
It’s interesting to see that three new investors co-led Memphis Meats’ Series B. While the first investment in cellular agriculture for SoftBank and Norwest, Temasek had previously co-led Perfect Day’s Series B and Series C rounds.
Memphis Meats' cell-based chicken
The investments by SoftBank (Japan) and Temasek (Singapore) signals that Memphis Meats may expand into Asia with their support. Temasek’s investment further highlights Singapore’s interest in the cellular agriculture field. As one of the lead investors in Impossible Foods and Perfect Day, Temasek is making Singapore the Asian hub for all these future of food companies.
It’s also noticeable to see the continued investments and support of meat industry players in Memphis Meats’ investment rounds. Since Tyson Foods and Cargill first invested in Memphis Meats, they continue to show interest in the field as well as plant-based alternatives. Tyson Foods also invested in Beyond Meats (divested before its IPO), plant-based seafood New Wave Foods, and Israeli cell-based meat company Future Meat Technologies. Cargill has also invested in Aleph Farms’ Series A round in May 2019.
Following Beyond Meat’s IPO in May 2019, many meat players, including Tyson, launched their own plant-based lines, such as Raised and Roots. Unlike the Beyond or Impossible burgers, Tyson’s products are a hybrid blend of meat and plant-based protein, and not entirely plant-based based.
Since Memphis Meats was founded in 2015, the company has become a leader in the nascent industry, especially when it comes to the regulatory front.
After showcasing the first ever cell-cultured meatball in 2016 and cell-cultured poultry in 2017, Memphis Meats has taken the lead to find a regulatory pathway forward for cell-based meat. Regulation is one of the major obstacles ahead of cellular agriculture companies, and, for the longest time, it remained unclear who would regulate the field in the United States.
Traditionally, the US Department of Agriculture (USDA) regulates and oversees animal products like meat, milk, and eggs. But what if those animal products come from cell cultures, a field that the Food and Drug Agency (FDA) would have oversight over?
In August 2018, Memphis Meats co-wrote a letter with the North American Meat Institute proposing a regulatory system moving forward for the field. This was the first time that a cellular agriculture company and a meat industry player came together to support a regulatory pathway that could appeal to both fields. The joint letter proposed a pathway in which both the USDA and FDA would regulate cell-based meat. The letter was also the first time Memphis Meats referred to their product as ‘cell-based meat’ and not cultured or clean meat.
Memphis Meats' cell-based duck meat
Since then, in March 2019, US regulators have established a basic regulatory framework in which both the FDA and USDA will jointly regulate cell-based meat. As Memphis Meats’ letter proposed, the FDA would be responsible for ensuring cell-based meats undergo pre-market safety tests while the USDA would oversee cell-based meat production facilities.
In addition, at the inaugural Good Food Conference in September 2018, several cellular agriculture meat companies announced that they will also adopt the term cell-based meat moving forward to garner more support and cooperation from conventional meat producers and regulators.
The following year, in August 2019, Memphis Meats was one of 5 cell-based meat startups to launch the Alliance for Meat, Poultry and Seafood Innovation (AMPS Innovation) regulatory coalition. AMPS Innovation’s goal is to advocate for a clear regulatory pathway to market for cell-based meat companies as well as to engage and educate consumers and stakeholders about their new industry. Considering the fight for the word meat at the state-level in the United States, it’s not surprising that cell-based meat companies believe that they need a coalition to advocate on behalf of the new field.
And now, Memphis Meats aims to be one of the first cell-based meat companies to set up a pilot plant to show that the future of food can be done.
Memphis Meats announced that they plan to use the new funds to develop a cell-based meat pilot plant around the Bay Area. Pilot plant development is an important step for validating how the company’s production process will look like before scaling up to a larger facility. Memphis Meats also shared that their pilot plant will be designed in a manner where it can produce various types of meats, like cell-based beef and poultry.
Considering how Memphis Meats has engaged regulators up to this point, the company will likely work and communicate with the relevant stakeholders as they develop and design their pilot plant. Emphasizing how their process can produce cell-based meat in a safe and scalable manner.
Based on how closely they work with regulators in designing the pilot plant, it’s possible that Memphis Meats’ production process may set the standards for what regulators will expect from other cell-based meat companies if they want to set up their own pilot plants and, eventually, large scale production facilities.
Interestingly, Memphis Meats’ pilot plant would not be the first cell-based meat pilot plant in the United States. The company JUST recently shared that they developed the first pilot plant in mid-2019 but did not announce the development. In October 2019, Future Meat Technologies announced they plan to set up their cultured meat pilot plant near Tel Aviv and aim to have it operational this year.
After a remarkable 2019 for cell-based meat startups, from the first cell-based meat grown in outer space to a record number of funding rounds, Memphis Meats’ funding round highlights that 2020 will be an even bigger year for the field as it continues to grow. By doubling all the investments in the field to date.
While Memphis Meats has not announced what their first product to market would be, Memphis Meats’ previous showcases of their meatball and poultry suggest that one of those (or both) would be one of their first products. Interestingly, Memphis Meats’ website also suggests that the company is looking into producing cell-based seafood as well.
Memphis Meats also has not announced when they will release their first product. The company stated they will likely aim to initially launch their first cell-based meat product at high-end restaurants first that will help them address the cost issues as they scale production.