SCiFi Foods Raises $22M With Andreessen Horowitz’s First Investment in Cultivated Meat
SCiFi Foods, a Bay Area-based food tech startup, announced that it has raised a $22 million Series A round led by Andreessen Horowitz (a16z), making it a16z’s first investment in the growing cultivated meat market. The company, formerly known as Artemys Foods, also announced that it will be adding a new board member, Myra Pasek, the General Counsel of IronOx, who will be utilizing her expertise from Tesla and Impossible Foods to help SCiFi Foods bring its novel plant-based and cultivated meat hybrid through regulatory approval to the market.
The new funding raises SCiFi Foods’ total funding to $29 million and will primarily be used to scale R&D efforts, build out the leadership team, and market the company.
The Spoon sat down with CEO and co-founder, Joshua March, to learn more about SCiFi Foods’ new name, a hybrid meat product, and what it looks like to raise funding from one of the most famous venture capital firms during a recession.
What’s the story behind the rebrand?
The original company name had always been a holding name. Over the last year, we spent a lot of time doing research and thinking about our brand strategy and positioning. First, while I’m really excited about our strategy, and I think what we’re doing is pretty unique and will give us the ability to get to market, we know that we’re going to be launching a brand in a very noisy old meat market. We knew that if we wanted to be able to have a shot of building a truly defining brand, we needed to do something that was really distinctive, and very different to anything else that was out there today.
We also knew that in the cultivated meat space, one of the biggest concerns that consumers will have is that it’s too scientific. The vast majority of average consumers are calling it lab grown meat. A lot of the attacks from the meat lobby, also go off on it for being lab grown meat. We think it’s really important to confront that head on, not by trying to hide the science, but by being really authentic, transparent, and bold about it.
Besides the branding, how does the technology of SCiFi Foods stand out from other types of cultivated meats, alternative proteins, and other meat hybrids?
It’s the combination of plant based and cultivated meat. What we found was that cultivated meat was having incredible effects on flavor, creating a much more beefy flavor and aroma than any plant based trial. Fundamentally, the most important thing is to create incredibly tasty products. And by taking a blended approach, it massively simplifies our ability to bring a product to market because we don’t need to do more tissue engineering, 3d printing scaffolding, and other complex technologies that are required if you’re trying to create 100% cultivated meat, which no one today actually knows how to do at scale cheaply.
Our approach allows us to create really transformational products, but also allows us to actually get to market from an equal timeframe with costs that are actually closer to conventional meat. Taste and cost define the market size for meat alternatives.
Besides taste and cost, another challenge can be regulatory approval. How does having a hybrid product help you navigate the uncertain regulatory landscape today?
If anything, it helps. The FDA and the USDA have a pretty clear regulatory framework on how to bring cultivated meat to market. Because our approach means that we don’t have scaffolding and tissue engineering, that reduces the amount of things that we need to take through regulatory approval.
What are your plans to scale your product and bring it to market?
Over the next couple of years, we’re planning on building out a pilot facility and going through the regulatory approval process. Once we’ve gone through that process, and we’ve had the facility approved, then the plan will be to do a small scale commercial launch.
Do you think consumer willingness will change between now and when you’re ready for commercial launch?
The major trends of more people, recognizing the huge environmental cost, especially with beef, is only getting bigger. People are also getting more comfortable with technology being used in the development of food. Younger generation of consumers feel those things even more strongly.
Even with transparency around technology, there’s still questions about the development and environmental impacts of cultivated meat. How is SciFi Foods targeting those questions?
We’ve done a lot of work, understanding those impacts. We’re very confident that the climate impacts of our products is a fraction of the climate impacts of eating conventionally.
Beef is the least efficient of all meats in terms of calories in calories out is 3-10% efficiency, it’s a small percentage; fundamentally growing cells in a bioreactor in terms of energy in and energy out is 97% efficiency, so drastically different. And with beef, up to 80% of deforestation in the Amazon, can be traced back to the cattle industry, either pasture land or as to grow crops, that animal feed. All the methane emissions that come up like 30% of methane emissions in the US come from cattle, one of the most potent greenhouse gas emissions.
And when you look at the emissions of complicated means, it’s basically no land use changes, minimal water, no methane emissions, you do have energy usage for powering the bioreactors. That’s less than the emissions from a cow. And, if you count that for renewable energy, then the climate impact becomes zero.
Is there a reason why SciFi Foods is targeting cultivated beef first, rather than dairy, chicken, or other meat products?
There’s a number of reasons for focusing on beef. It does have the biggest climate impacts. It’s also one of the biggest markets. It’s also the most expensive. The highest demand for meat alternatives is also beef. And yet, in the cultivated meat space, most cultivated meat companies are going after chicken, which is complex. And the reason for doing so is basically that it’s scientifically easier to manufacture chicken cells.
What makes a16z a great partner for funding at this stage?
a16z is one of the best investors in the world and a key part of their model is that they’re not just financial investors, but they also bring a lot of support, in terms of, help with HR, recruiting, the best practices, introductions to other investors, and various different areas. I’ve worked with a lot of VCs over my career, and they definitely have the best set of support functions and ways of helping founders and entrepreneurs that I’ve ever seen.
A lot of a16z’s track record has been with technology and they just announced a new crypto fund. What specifically are you looking for in terms of help with foodtech?
It’s worth noting that they have a very substantial bio fund, which led our investments. And that fund is completely focused on the intersection of biotech and synthetic biology. In many ways we combine those things. Yes, we do consumer food and food tech, but we’re also doing synthetic biology and biotech and sitting at that intersection. They have a huge amount of experience, and connections with VCs, and executives, scientists, and advisers in a lot of the real scientific work that we need to do to bring our product to market.
A lot of private funding lately hasn’t been very active and it’s been hard for startup founders to raise. What has navigating that landscape and raising a round been like for you?
The market is very volatile right now. There’s always capital looking for really great companies that have a very differentiated approach and the ability to drive a significant IP advantage and who can have a defensible advantage. Fundamentally, that’s what an investor needs in order to be able to pack a company that can have a big impact on the world, but also have a great financial return.