This article is a teaser for the Scottish Mortgage UPSIDE Foods podcast. Uma Valeti, UPSIDE Foods’ founder, talks to Lawrence Burns about his plans to put cultivated meat on the public’s plates.
As with any investment, capital is at risk.
Some images stick in your imagination and shape who you become.
Dr Uma Valeti is UPSIDE Foods’ co-founder and chief executive. He recalls an early moment that propelled him towards creating a company that makes meat without the need for animal slaughter.
Aged 12, he attended a neighbour’s birthday party in South India. The front of the house was full of people eating and dancing. At the back, Valeti stumbled upon others killing chickens and goats to feed those at the event.
“There’s intense happiness in the front of the house celebrating a birthday. And there’s a profound amount of sadness and suffering in the back of the house, where it was a death day for the animal,” he told Scottish Mortgage deputy manager Lawrence Burns on the Trust’s Invest in Progress podcast.
Meat is central to most of the world’s cultures, traditions and daily meals. But it is becoming ever more unsustainable. Some 70 billion animals are raised yearly to feed humanity, and demand is expected to double by 2050.
“We’ll have to think about finding space for 150 billion animals, the feed to feed them, the greenhouse gas emissions, and the water pollution that comes from having that many lives every year to feed humanity,” explains Valeti.
It’s a dilemma for many consumers. They like the taste of meat but want transparency, humanity, and sustainability in food production, leading to some reducing or eliminating meat from their diet.
Valeti relates. As a medical student, he became a vegan.
“I said, ‘I love this product, but I’m going to stop eating meat.’ And every single day after that, I kept missing the taste of meat. I would say, ‘Oh, I’d love to have this on my table’, but didn’t know how to achieve that.”
Perhaps Valeti would have resigned himself to a restricted diet were it not for an idea he had when working as a cardiologist.
“We were taking stem cells from humans,” he explains. “And we injected them into their hearts when they came in with a heart attack or cardiac arrest. And that’s where this idea came from: could I think about growing meat from animal cells directly?”
Valeti makes it clear that his firm makes ‘real’ meat that is genetically identical to what’s on millions of people’s plates. The difference is that UPSIDE cultivates it, ‘growing’ its meat in a laboratory from the highest quality animal cells.
“What we do is we identify the highest quality cells and provide them with the nutrients that the cells need to grow. And we provide that in a very clean, controlled environment,” says Valeti.
“The cells are doubling and doubling and doubling. And ultimately, after two to four weeks, we have enough meat that’s formed because the cells are essentially the building blocks of meat. We shape it into a product that a consumer is used to seeing. It could be a chicken breast, chop, burger, sausage, or steak.”
UPSIDE Foods is not alone in pursuing this idea. But unlike plant-based alternatives to meat, there are significant barriers to producing cultivated meat.
He believes his company is at an advantage, “I think about it as four legs of a stool or a table, the taste, the team, the technology and our track record.”
His claim that UPSIDE’s meat “nails the taste and texture” of meat is corroborated by those who have tried it. And that’s not surprising given the team is drawn from “some of the best in each of the fields, so the biology, the chemistry, manufacturing, and food science and chefs.”
The technology that the team has built is “species agnostic”, meaning that if it works for poultry, it will work for beef and so on.
But that’s not to suggest that it is easy. He refers to the resilience that his team have formed in getting this far, “When people come together with a singular purpose, and they’ve seen that payoff, that builds a level of confidence and that builds a level of resilience.”
It seems to be working. In late 2022, UPSIDE became the first cultivated meat company to receive confirmation from the US Food and Drug Administration that its chicken meat is safe for consumption.
It’s an important early milestone on the path to disrupting a $2tn industry. The next step is to get the US Department of Agriculture’s (USDA) approval.
That will allow UPSIDE’s meat to go on the menus of select high-end restaurants with world-famous chefs. It will be up to them to sell the vision of cultivated meat.
UPSIDE Foods’ co-founder and chief executive Uma Valeti tells Scottish Mortgage’s deputy manager Lawrence Burns how his firm developed a way to create meat without needing farmed livestock.
Listen to the podcast here.
Valeti acknowledges that consumers will need to be educated and convinced. But he believes concerns about animal welfare and the environmental impact of farming livestock at scale play to UPSIDE’s favour.
“We have multiple species we are working on,” he says. “We’ve shown that the science works [for chickens]. We’ve shown that we can grow real animal cells into meat that tastes good. And we’ve shown that we can do it in a safe way. The path ahead involves us trying to make this scalable, bring it in a cost that is affordable, and also show people that it is worth investing in it on a large scale.”
“In the next 50 years, if cultivated meat captures about a third of the market, it’ll have a meaningful impact on animal welfare and a huge impact on the opportunity to save human lives.”
Scottish Mortgage’s investment in UPSIDE typifies the Trust’s approach, backing a company that has developed a disruptive innovation beyond the concept stage and now has a chance to grow rapidly by creating transformational change.
If UPSIDE succeeds, the potential for growth and societal benefits are enormous.
Claire Shaw is a Portfolio Director and plays a prominent role in servicing Scottish Mortgage’s UK shareholder base. Before joining in 2019, she spent over a decade as a fund manager with a focus on managing European equity portfolios for a global client base. With a background in analysing companies and communicating investment ideas, Claire is also responsible for creating engaging content that makes the Scottish Mortgage portfolio accessible to all its shareholders. Beyond that, she works closely with the managers, meeting with portfolio companies and conducting in-depth portfolio discussions with shareholders.
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