Farmers know that growing a seed in the right soil under optimal climatic conditions is key to a successful harvest. As farmers for the future, the seeds we are currently sowing are cellular agriculture startups. Plants have endosperms and cotyledons to nourish them as seedlings; the cell ag industry has passionate investors. Yet without a suitable environment, cash from investors, like nutrients from the endosperm, cannot unlock full growth potential.
Although investment alone is not enough to get cell ag products onto consumer plates, it certainly helps. Cultivated meat companies around the world raked in 49 investment deals totalling US$366M during 2020. This represents 72% of all-time investment capital (commencing in 2016 when the first US$6M was raised) and is a 487% increase from 2019.
Globally, fermentation technologies covering both precision fermentation (using microorganisms to make specific molecules) and biomass fermentation (growing large quantities of edible microorganisms) attracted US$587M in 2020—more than double the amount raised in 2019. Despite the lion’s share of this capital going to U.S. companies, investment in Australian businesses has gathered momentum and this funding trend has continued into 2021.
With just shy of ten startups, the Australian cell ag ecosystem may be in its infancy but together these companies come close to covering the full spectrum of globally available cell ag products. Meat from diverse species (including kangaroo, tortoise, and lamb), animal fats, dairy proteins for milk and cheese, human breastmilk, scaffolds for cultivating whole cuts and non-woven materials, and serum-free media all feature in Australia’s repertoire. The only notable absence is seafood. The technologies underpinning these products are also well-balanced between fermentation and cell-culture techniques, ensuring diverse approaches are employed in the Australian pursuit of alternative proteins.
For all the impressive gains in the Australian cell ag space over the past 18 months, there is one ugly truth that cannot be ignored: the deficit of female founders and CEOs. Esha Saxena, co-founder of Me&Ma, and Bianca Lê, Founder and Director of Cellular Agriculture Australia, are the only women who hold such titles. Australia’s Old Boys’ network is notorious and gender imbalances in the country’s workforce are well-known—the World Economic Forum’s 2021 Global Gender Gap Report ranked Australia 70th for female participation and opportunity in the economy. But a benefit of the Australian cell ag community being so young is that the opportunity still exists to shape it into one in which people of all genders with good ideas are empowered to step up, take charge, and drive innovation.
David Bucca, Founder & CEO of Change Foods, a US-Australian animal-free dairy startup, heralded fermentation “the third pillar of alternative proteins” alongside cultivated and plant-based alternatives. This growing appreciation for the power of fermentation is evident in Australia’s cell ag ecosystem—both in the capital invested in the technology and in the fact that more than half of its nine startups utilise fermentation.
Precision fermentation gave us the first commercially available cell ag product when in 2019 Perfect Day launched its animal-free ice cream in the US and then made their fermentation-derived dairy proteins more widely available in 2020 via inclusion in ice cream from other brands. Similarly, precision fermentation will likely underpin the first cell ag products approved in Australia as the technologies are already well- established and understood. Furthermore, the science is very similar to that already used to make insulin for diabetics and rennet for cheese-making. (Approving the commercial sale of cultivated animal tissues is an entirely different beast.)
Australia also has a thriving plant-based industry. Current plant-based meat, fish, dairy, and egg options largely fail to meet consumer taste, sensory, and functional expectations. However, this means they make the perfect blank canvas on which fermentation products can shine—a small amount of strategically-designed bioidentical lipid and/or protein can make the eating experience of plant-based foods indistinguishable from that of animal products. As such, consumers’ first impressions of cell ag will likely be based on precision fermentation, so gaining consumer trust in these products is a critical first step in ensuring widespread acceptance of cellular agriculture.
All G Foods closed an AU$15.5M seed round to develop dairy proteins as well as other functional components to enhance their plant-based meat products. Animal-free lipids were given an AU$14.4M boost through Nourish Ingredients’ seed funding. A further AU$7.1M was raised in the animal-free dairy space, with Eden Brew attracting AU$4M to create lactose-free, cholesterol-friendly milk, and Change Foods bringing their total funding to AU$3.1M with an additional 2.1M to produce cheese.
Many of the founders, CEOs, and CTOs of Australia’s cell ag startups have strong ties to universities and research organisations. Junior Te’o of Change Foods was previously an Associate Professor at the Queensland University of Technology. Eden Brew’s Jim Fader has roots in CSIRO (the Australian Government’s scientific and industrial research agency). Similarly, James Petrie, Ben Leita, Anna El Tahchy, and Surinder Singh of Nourish Ingredients were previously based at CSIRO. Both Eden Brew and Nourish Ingredients are backed by Main Sequence, the venture capital firm created by CSIRO.
Cass Materials is another Australian cell ag startup capitalising on the power of fermentation but with a slightly different goal in mind. Specifically, the company focuses on biomass fermentation—the process of generating high volumes of a desired product by harnessing the naturally fast growth of microorganisms—to produce scaffolds made from bacterial nanocellulose for whole cut cultivated meat. This product addresses the major issue of enabling the homogenous mass of cells that make up most current cultivated meat products to grow into the defined shapes consumers expect from premium meat cuts. In addition, their non-woven materials have industrial and medical applications.
Australia also boasts established companies realising their potential to expand into the cell ag industry. Agritechnology is Australia’s answer to scale-up obstacles with over 30 years’ specialist fermentation expertise and the capabilities to assist startups to overcome R&D challenges before achieving in-house commercial-scale.
Only two full stack cultivated meat companies have been established in Australia. Vow aims to develop the best tasting meat products, whether that be from species we currently consume on a regular basis or from entirely novel sources. Magic Valley is currently focused on creating cultivated lamb. For vegan founder Paul Bevan, lamb was the obvious first product for his company given how young lambs are when they are sent to the abattoir. Supporting the country’s cultivated meat ambitions is Heuros, a serum-free media and bioreactor startup. Their aim is to produce media without the use of genetically engineering to create recombinant proteins, while also facilitating scale up with custom bioreactors.
It’s especially encouraging to see more niche products such as human breastmilk finding their way into the Australian cell ag space at a relatively early stage. Me&Ma launched in 2021 with the mission of cultivating stem cells as well as using fermentation technologies to produce breastmilk with the optimal nutritional profile for human babies.
A unique combination of factors positions Australia to excel in the cell ag space: 1) a well-regulated food industry, 2) an international reputation for high-quality meat, 3) biotech research excellence, and 4) the quirks of geography.
Being first to authorise the sale of cultivated meat, might give Singapore (and soon Qatar) a head start in dominating the market. Despite that, Australia’s highly regarded food regulatory protocols and international reputation for safe, high-quality food will place the country at a significant advantage when the time comes to start exporting cell ag products.
Official commentary on cultivated meat from the food regulation agency Food Standards Australia and New Zealand (FSANZ) states that their current regulatory frameworks are “equipped to deal with new types of foods, including foods produced by new technologies”. Cultivated meat is not for sale in Australia simply because FSANZ has "not yet been approached by a food business seeking regulatory approval”—not because regulatory standards are prohibitive to its commercialisation. The body believes that these products “would be captured within existing standards”, indicating that gaining regulatory approval in Australia is unlikely to be a significant barrier for cell ag companies.
FSANZ has also recently supported the use of terms typically associated with animal products, such as ‘burger’, ’bacon’, and ‘milk’, on packaging for plant-based alternatives. This move likely heralds an approach to labelling cell-based meats that allows products to be branded with the same names as their animal-derived, bioidentical counterparts. This sets Australia apart from the United States and European Union where volatile debate over naming conventions has ensued (e.g., Senate Bill 2922 which passed in Mississippi to prohibit cultivated, plant-based, and insect-based meats being labelled as meat products, and Amendment 171 which was shut down but not without first costing the alternative dairy industry precious time and resources to fight it).
A drought-prone agricultural nation with concerns over water use is an excellent setting for cell ag to flourish. Australia has established itself as a beef export powerhouse. However, 2020 saw the country knocked from its perch as the world’s most valuable exporter, with the 2019 Australian drought largely to blame. In recent years, climate change has led to devastating water scarcity, leaving ranchers vulnerable to reductions in cattle herd size.
Extended periods of low rainfall are likely to be a permanent feature in Australia. As a food production technology that is largely uncoupled from environmental conditions, cellular agriculture is well-positioned to thrive in the country. The opportunity to capitalise on the nation’s standing as a highly regarded meat supplier, along with its desire to maintain this position in the face of climate stress, uniquely places Australia to transition from a leading supplier of traditionally farmed animal products to a leader in the cell ag space.
Connections to the conventional farming industry have also been important in the establishment of Eden Brew. Norco, Australia’s oldest dairy cooperative, is a key financial backer of the startup. This partnership enables Eden Brew’s integration into the current dairy network, allowing development of trade relationships to be fast-tracked.
Australia has a strong history of excellence in stem cell and regenerative medicine research and a habit of putting this knowledge to use in biotechnology, frequently placing in the top five counties in various global rankings of these areas. Currently, most of this stem cell and regenerative medicine knowledge is not focused on developing cultivated meat, but some experts are starting to shift from academia into the cell ag industry. For example, Dr Luis Malaver-Ortega, a cattle stem cell pioneer based at Monash University, co-founded Me&Ma with the aim of developing human breastmilk for babies. Cultivated lamb company, Magic Valley, has also attracted two of academia’s top induced pluripotent stem cell (iPSC) experts. The startup’s Chief Scientific Officer, Professor Paul Verma of the University of Adelaide, was involved in producing the first international reports on cattle and reprogrammed sheep iPSCs, and the Lead Scientist, Dr Jun Liu of AgriBio, La Trobe University, generated the first human iPSC line in Australia and is internationally recognised as an expert in livestock iPSC.
Further promotion of cellular agriculture in Australia will hopefully inspire more leaders in stem cell and medtech research to apply their knowledge and skills towards innovating food technologies. This would require both individuals making the leap between academia and industry as well as academic labs with relevant research infrastructure shifting their focus from medicine to cell ag. The four Australian labs presently carrying out cell ag research (one based at each of the following institutions: The University of Melbourne, University of New South Wales, Queensland University of Technology, and the University of the Sunshine Coast) span biotech, veterinary and agricultural, and chemical engineering.
Healthy competition and collaboration contribute to developing the highest quality goods. For this reason, California, USA, which hosts some of the biggest names in cell ag and alternative protein, would appear the ideal location to establish a startup. What could be better than slotting right into a rich, pre-existing cell ag infrastructure and forging symbiotic partnerships to bolster your company?
“Not being in the [Silicon] Valley, it forces you to look at the problem differently, right? Because you may not have the same ready access to either talent or facilities around you. And it makes you look for homegrown solutions that are even more innovative in some cases. … We could move to the States, but I think there are advantages to taking just a bit of a lateral approach to the problem”, says James Petrie, CEO and co-founder of Canberra-based Nourish Ingredients.
Being geographically separated from the saturated tech hubs forces Australian companies to think outside of the box. Diversity of thought is our best chance at finding optimal solutions to current challenges in cell ag. We need companies that are willing to risk trying wild ‘out-there’ approaches both to what they make and how they make it. Recently, Australian startups have exemplified the distinct creativity that can arise outside of an established innovation hub.
Vow is a unique cultured meat company. Globally, it is the only player in the space developing cuts from diverse exotic and wild animals. The startup is on a mission to develop the best tasting food and understands that the animals that humans have domesticated aren’t necessarily the most delicious. Their open-minded approach of wanting not just to recreate the carnivorous dining experience, but invent an entirely new, more delicious and more sustainable category of food sets them apart from every other cultured meat company that has the goal of replicating the taste and texture of currently available animal products.
Nourish Ingredients shares a similar vision. Synthetic biology is at the foundation of their technology, giving the company limitless creative potential. Like Vow, their approach means that they are not locked by the constraints of pre-existing biology and are free to explore, invent, and discover the best flavours and textures achievable in a lipid molecule.
The shared philosophy of these two Australian companies was the perfect opportunity for a first of its kind partnership: the coming together of a cultivated meat startup and a fermentation startup. The expertise required to create the best animal-free protein is different to that required to develop the best animal-free fats. That’s why the combination of these two companies with their shared philosophies but different technological approaches is the ideal marriage. Tim Noakesmith, founder and CCO of Vow claims, “We’re obsessed with food, not purists on technology”.
Typically, cultivated meat companies looking to address the issue of fat in their products turn to animal adipocyte cell lines. Australia lacks a company specialising in mammalian, avian, and/or fish lipids from dedicated cell lines, but this empty niche in the cell ag ecosystem was an opportunity to create something even better. Nourish Ingredients is the country's fat specialist, and their use of fermentation coupled with synthetic biology, rather than non-GMO cell culture, enables the production of a more diverse range of fats that can be grown more cost effectively. In fact, the future of food will most likely be hybrid, combining different types of alternative fats and proteins into the most delicious foods. As consumers, we can get excited for entirely new categories of food: products that do not merely replicate meat, but rather supersede our sensory expectations.
Of course, the aim is not to keep the Australian cell ag status quo such that key products are absent from the scene, but for the moment this certainly is not a disadvantage to other Australian startups.
Ensuring that Australia’s cell ag industry continues to attract the talent and funding required to develop world-class products is a key focus for the non-profits supporting the industry. In particular, pushing for more government funding will ensure that scientific advances in cell ag are not entirely locked up in the IP of private companies—a recipe for slow growth fuelled by insular thinking.
For this reason, Cellular Agriculture Australia aims to facilitate growth of the field in the country by promoting and accelerating research, collaboration, competition and innovation across the cellular agriculture sector. At the end of their first full year as a registered charity, they are achieving these core goals through:
This work is largely supported by a committed team of volunteers giving presentations to university and high school students, creating engaging content to raise public awareness about the field, and getting conversations started about the future of the world’s food systems.
Australia’s cell ag industry has made excellent headway, but this is just the beginning of one of the most exciting stories of our generation.
Ruth Purcell is PhD student at the University of Melbourne. She is a consultant for Nourish Ingredients, where she formally worked as a synthetic biologist. In her spare time she volunteers with Cellular Agriculture Australia, writing and giving presentations about the cell ag industry and the science driving the field.
Cellular Agriculture Australia, a non-profit with the goal of connecting companies, investors, academics, and students in the field, has mapped out the key players in the cell ag ecosystem.
Read the original article at https://www.cell.ag/blog/cellular-agriculture-australia-right-place-right-time-right-tech
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