Answering Climate Change with a Meaty Disruption

A San Francisco-based startup cooks up a juicy new solution to eliminate animal agriculture emissions.

A Beefy Opportunity

Raising livestock accounts for 18% of the global greenhouse gas emissions – from methane, primarily, but also from animal feed production and land use[1]. Animal agriculture takes up ⅔ of the world’s water supply[2]. Producing meat is a huge stressor on the planet, yet consumers continue to demand it. The leading meat and poultry processing companies in the U.S. had ~$160B in sales in 2015[3]. This growing conflict between the meat industry and global climate concerns presents a huge opportunity for new and old players to find efficiency and resolve the conflict.

An Udderly New Solution

Many companies are attempting to capitalize on climate change’s livestock emissions problem. While some companies are trying to shift focus to plant-based foods, one company has come up with a creative solution without compromising the end result: Memphis Meats is growing meat in a lab. Well, kind of. After R&D, meat cells are actually grown and cultured in a way that resembles how beer is brewed in a brewery. By growing actual meat cells outside the body of an animal, Memphis Meats has eliminated much of the environmental cost of traditional animal agriculture: no cow, no pig, no feed, no emissions. What I think is extra cool about clean meat is that it helps solve several major food problems simultaneously: creating a sustainable source of meat, getting ahead of the world’s increasing demand for food, which is predicted to at least double by 2050[4], and eliminating animal welfare concerns associated with traditional animal feedlot practices.

In a Prime Position

Few organizations are currently developing meat production alternatives quite like Memphis Meats. In fact, SuperMeat may be one of the only other companies producing cultured meat[5]. In any case, when the opposition/opportunity size is the traditional meat industry, competition doesn’t seems to be a huge concern. Memphis Meats products are still in R&D, but media coverage has been optimistic about the results. Huffington Post at least thinks the Memphis Meats meatball looks “pretty damn tasty”[6]. The company is gearing up to raise their series A next year and require investor funding to continue R&D and go to market. The goal: be available in grocery stores by 2021[7].

Next Mooves

As consumers increasingly realize the impacts of climate change and how much of that is caused by the meat industry, demands for solutions will increase accordingly. Memphis Meats stands to gain considerably in this movement. To fully realize those gains, I would recommend they focus on (1) pushing consumers into the movement and educating them and (2) satisfying the demand when it arrives.

I think it’s important for Memphis Meats to participate more actively in the conversation around sustainable agriculture. They should have a bigger online presence and invest in inbound marketing to increase consumer awareness of both the problem and the existence of alternatives. They also need to manage their messaging about clean meat. From the perspective of the end product, cultured meat is arguably the closest alternative to meat produced via traditional agriculture. By that logic, it should be the easiest to convert current consumers to compared with plant-based products, but it can flop if not managed properly. Because, perception. Lab-grown meat is weird! Can I get a well-marbled slab of it? Are you playing god by doing this? What are the inputs to growing these meat cells and how are they actually more efficient than the crops we grow to feed animals? If they haven’t already done so, the company should prepare to objection handle and reach out to consumers beyond the one cool YouTube video they’ve produced[8].

In parallel, I think Memphis Meats should prioritize plans to scale quickly to meet customer demand and truly make a difference in emissions generated by animal agriculture. To that end, partnering with grocery chains or even with meat companies themselves could be effective. A company like Tyson Foods may have the infrastructure, relationships with distribution, capital that Memphis Meats needs to scale its operations. To date, regulation has been arguably ineffective in incentivizing the meat industry to change its practices to reduce emissions[9], but that may not be the case long-term. Furthermore, meat processing companies are only considering half measures to reduce emissions such as changing the diet of cows to reduce methane. Memphis Meats’ radically different approach may make it all the more attractive to these companies. Obviously there would be significant risks with such a partnership that the company would need to weigh against the benefits.

I believe in the mission of Memphis Meats, and I’m hopeful they’ll be able to manage perception and scale in order to capture the opportunity climate change has presented. Go Memphis Meats!!

Word Count: 791

Endnotes

1Mario Herrero. To reduce greenhouse gases from cows and sheep, we need to look at the big picture, The Conversation, March 21, 2016. http://theconversation.com/to-reduce-greenhouse-gases-from-cows-and-sheep-we-need-to-look-at-the-big-picture-56509

2Eve Wettläufer. We Should Embrace the Clean Meat Revolution, U-Wire, October 5 2016. https://global-factiva-com.ezp-prod1.hul.harvard.edu/ha/default.aspx#./!?&_suid=1478268245692024403430371687795

3Meat & Poultry. n.d. Leading meat and poultry processing companies in the United States in 2015, based on sales (in billion U.S. dollars). Statista. Accessed 3 November, 2016. https://www-statista-com.ezp-prod1.hul.harvard.edu/statistics/264898/major-us-meat-and-poultry-companies-based-on-sales/.

4Maarten Elferink, Florian Schierhorn. Global Demand for Food Is Rising. Can We Meet It? Harvard Business Review, APRIL 07, 2016. https://hbr.org/2016/04/global-demand-for-food-is-rising-can-we-meet-it

5Andrew Tobin. No harm, no fowl: Startup to grow chickenless chicken, Times of Israel, July 13, 2016. http://www.timesofisrael.com/no-harm-no-fowl-startup-to-grow-chickenless-chicken/

6Hilary Hanson. ‘World’s First’ Lab-Grown Meatball Looks Pretty Damn Tasty, Huffington Post, Februrary 2, 2016. http://www.huffingtonpost.com/entry/lab-grown-meatball-memphis-meats_us_56b12317e4b04f9b57d7a9b2

7Jacob Bunge, Patrick McGroarty.Quest Heats Up for Alternatives to Beef, Dow Jones Newswires, November 4 2016. https://global-factiva-com.ezp-prod1.hul.harvard.edu/ha/default.aspx#./!?&_suid=1478268245692024403430371687795

8www.memphismeats.com

9Christopher Hyner, A Leading Cause of Everything: One Industry That Is Destroying Our Planet and Our Ability to Thrive on It, October 23, 2015. https://journals.law.stanford.edu/stanford-environmental-law-journal-elj/blog/leading-cause-everything-one-industry-destroying-our-planet-and-our-ability-thrive-it

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9 thoughts on “Answering Climate Change with a Meaty Disruption

  1. This is a fascinating idea. I would have two main concerns about the concept, however. First, and most importantly, this has to be very cost effective to have any chance of working. Consumers aren’t going to pay double the price for meat just to make it more sustainable. I think it could take many, many years for this to scale to bring costs down to acceptable levels. Second, I am curious about the response of consumers to this meat which could be viewed as “unnatural”.

  2. I think Memphis Meats offers one of the most innovative solutions to mitigate the environmental harm we have experienced as a result of the livestock industry. While I love how the company addresses multiple issues simultaneously (increased demand for food, animal welfare practices, and environmental sustainability), I think their product is antithetical to a major trend we are seeing in today’s market. Ask any professional in the consumer products industry, and they will tell you that consumer demand for natural / non-artificial products has skyrocketed and unlike other trends we have seen in the past, this one is here to stay for the long run. Given this I think Memphis Meats is going to have an extremely difficult time gaining a large enough consumer base to actually have a tangible impact on reducing the carbon footprint of the livestock industry. I believe at best this will be a niche product as the barriers to trial are massive in light of consumers changing preferences towards natural products. I think it’s far more more likely that we will see consumers shift towards plant based diets, which is more consistent with health craze we are seeing.

  3. This is a fascinating post, thanks for sharing. It seems evident that consumption preferences will need to undergo paradigmatic shifts in order for sustainability to truly become the name of the game in the protein industry. I think this is unfortunately likely to happen a little too late – consumers will likely not consider other options until the price of beef has increased so much (because of regulation and lower availability of cattle raising inputs) that it is considered a luxury.

    Memphis Meats would be well served to partner with celebrity chefs that can create interesting recipes and suggested dishes with the product, creating buzz and a sense of novelty. There are companies doing this in the cricket protein space – essentially the use of crickets and other insects to generate consumable protein at a low cost .Even Indra Nooyi of Pepsi is behind this:
    http://www.forbes.com/sites/christinatroitino/2016/10/31/why-pepsis-ceo-believes-that-bugs-are-the-protein-of-the-future/#134e3fc92211

    In addition, Memphis Meats could arguably make meat healthier by reducing fat and carcinogens from its meat.

  4. This is super interesting, thanks for the post! My first thought and concern though is about industry resistance. I did a quick search and came up with three seemingly powerful meat trade and lobbying organizations: the American Meat Institute, the National Meat Association, and the National Cattlemen’s Beef Association. I wonder how far these organizations will allow Memphis Meats to advance without throwing their political influence and lobbying dollars in the way? I will definitely be interested to see how Memphis Meats navigates this environment.

  5. I found this discussion paper fascinating – particularly given the potential ethical conflict you alluded to i.e. is Memphis Meats playing God? Genetically modified / lab-grown products are subject of extensive public debate however if you run the numbers for population growth vs food supply, supply simply falls short. This challenge is exacerbated by the fact that the current food trend is emphasizing organically grown products, which typically have lower yields (this point was also made in MPDHBS2018). Ultimately I think there is a balance to be struck between “traditionally” sourced food and lab-grown produce. Like you, I see this as a highly pressing issue and would like to see Memphis Meats play a larger role in this discussion. Great work!

  6. As a many-year vegetarian (for a combination of ethical / environmental / animal rights reasons), I find these types of innovations extremely exciting. As Nicole brought up, I’m fairly skeptical of the assumption that the big names in the meat industry will have an incentive to partner with Memphis Meats for the foreseeable future. Their current model is highly profitable and has thus far flexed its lobbying might to avoid a tremendous amount of needed regulation. Furthermore, an acceptance of Memphis is basically an admission that their normal model is problematic, probably not a concept they want to promote.

    My other concern, as others have brought up, is customer perception. Even beyond the issue of “artificiality”, I’m worried about driving consumer demand toward this concept and away from traditional meat sources in general. For years, we have had access to large volumes of written, photographic, and video evidence of the horrors of factory meat farming in the US, and the vast majority of people seem not to care. I hope you are right, and that adding on the environmental impact will sway people in ways that the traditional dialogue couldn’t, and it seems that much of their marketing efforts should focus here, as you have said.

    Thank you so much for bringing this company to our attention, and for highlighting the meat industry’s huge impact on climate change.

  7. Totally agree with your point in educating consumers on the energy input required to produce meat. Beyond Meat is a flagship company in this space (Bill Gates among other prominent investors) and while they are commercial, they have faced significant headwinds in penetrating the consumer market, though a recent placement into Whole Foods’ burger shelf should help improve sales.

    Ironically, the traditional meat company partnership has materialized to an extent within Beyond Meat, as Tyson Foods (!) acquired a 5% minority stake. http://www.nytimes.com/2016/10/11/business/tyson-foods-a-meat-leader-invests-in-protein-alternatives.html?_r=0 301 Inc., the venture arm of General Mills, also invested in Beyond Meat, which is another interesting investor case. Perhaps General Mills is confident that synthetic meat can win over enough consumers from traditional meat to change fundamentals and reduce livestock, thereby reducing grain demand and lowering raw material costs.

    I believe this was alluded to above, but lab-based foods fall into a grey area of food and safety regulation (the murky waters of GMO), and in some countries, this will be a larger obstacle than in others. I believe one way to navigate this uncertainty is to partner early with your target market’s regulatory body and establish a fluid working relationship, as Beyond Meat and others have done in the synthetic meat world.

  8. After reading many books on the benefits of plant based diets – both for my body and the planet – I decided to go vegan in 2013. The environmental arguments are convincing: In a world with so much hunger, why do we waste so much energy growing crops to feed livestock to then feed humans, instead of just feeding humans the crops directly? I once heard a stat that, in the US, every calorie from a meat source requires about 25 calories from plant sources further up the chain.

    After about two years as a vegan, I decided to return to a more traditional diet that included meat, eggs, and dairy. I personally found it too difficult to consume the calories and nutrients I needed to support my lifestyle in a time-efficient manner while eating as a vegan. I made this decision knowing that going back to eating these foods would increase my burden on the environment.

    Similarly, I would not be eager to eat this product even though it would clearly be better for the environment than traditionally raised livestock. Human and animal biology are so complex that I suspect laboratory created meats will suffer from unintended consequences. For example, we now know that eating just muscle meats, instead of the whole animal as traditional cultures do, can result in amino acid imbalances in the body.

  9. Hi RT! Thanks so much, it was great to read about Memphis Meats and its quest to becoming a “greener” or more sustainable alternative to meat. In order to accelerate growth, one other market dimension that the company may consider is ethical / moral / religious vegetarians. That the meat is grown outside the animal’s body leaves open to interpretation its origin and meaning as “meat”. The company should use this opportunity to collaborate with leading ethicists, religious leaders, and morality scholars to foster healthy public arguments about the “non-meat” nature of this product.

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