Investing in Israeli Plant-Based FoodTech

This fascinating podcast discusses the pros and cons of plant-based alternative proteins compared to cell-cultivated protein replacements. Issues discussed include:

• What are the capital requirements of plant-based alternative proteins compared to cell-cultivated protein replacements?
• How do the incremental production costs compare?
• How do the regulatory pathways compare?
• Do plant-based proteins have a significantly larger addressable market given that vegetarians may be more favorable to plant-based proteins versus cell-cultivated protein?
• What is the shelf-life of plant-based proteins?
• What does “clean labeling” mean and what is its significance?
• To what extent can different crops be mixed and matched in producing plant-based protein?
• How feasible is countertop 3D printing of plant-based meat alternatives over the next several years?

Chanan Schneider also introduced us to promising Israeli foodtech companies such as Phytolon, SavorEat, TIPA, TripleW, ansa, and Egg’n’up.

Chanan Schneider, CEO, Millennium FoodTech

Chanan Schneider is an entrepreneur, CEO, and experienced investor in start-ups. Since 2020, Chanan founded, built and managed the Food-Tech Incubator in Kiryat Shmona, partnering with Tempo, Tnuva, OurCrowd, and the U.S. VC Fund Finistere. Chanan founded IndaMed and managed companies such as Beta-O2 and Nitiloop.

Investing

Food Technology

Millennium Food-Tech

Speaker 1    05:54

So that’s OK that that’s a very thorough answer. Before we get into plant based technologies, maybe we can talk for a few moments about the importance of food technology in view of the world shortage of food. There’s something like 30 or 40 countries that are at the starvation line and there’s riots in Sri Lanka and maybe Egypt. So this is a very serious thing. That’s not all because of the war in in in the Ukraine. There’s a movement all over the world to disallow farmers from using nitrogen based fertilizer and making their work much more difficult as protests in the Netherlands and and elsewhere, so maybe you can amplify that yeah so it’s a great point, David, and you got right into the point. So the the population of the world are growing up and the resources are going down there. In some way because of climate changes, in some way because of a population or sorry. Building, you know, building of more cities and more places etcetera. Now when you’re looking at that and you need to feed the world, you are thinking about why should I put resources that are 11 times more in the raising cattle instead of having something which is plant based, sorry yeah so so This is why. All the big food companies are looking for new technologies and new product that are going that are trying to solve the issue of feeding the population. Now there is A and and taking that into the plant base session that we would like to have is you know that when beyond meat came up basically they have invented the category and now we are inventing inside the category. Meaning when beyond meat came to the to to to the knowledge of the people, they came up and said why? Why should we use or consume plant based product which are really not tasty and not look like a real meat? Because let’s face it, we had plant based opportunities even before beyond meat and before impossible for then others. Why didn’t we? Why didn’t that? You know, I took more than 5 to 7 % of the consumption. This is because beyond me, maybe what was the first one who came up and said we are targeting not the vegetarian and not the the vegan, we are targeting the flexitarian, the ones who want to reduce the meat consumption and not to eliminate it altogether. So beyond me came up and said we are going to bring to the consumer a product that looks like meat, tastes like meat and basically will give you the experience of meat. And they’ve invented together with impossible, they’ve invented the category of blend based meat, which is similar to meat now, the companies and by the way Israel, that which is a small, very small market. It’s about 200 a quarter of a billion dollar consumption of plant based meat last year in 2021 So we see that the that now the consumers are looking for that solutions and that solutions are are coming up and being more and more with nutrition values as opposed to the first product and more and more. Basically similar to the meat that they are replacing.

Speaker 1    10:02

Ok, so that’s an interesting issue. Plant based meat is acceptable to vegetarians whereas a cell cultivated protein is not, because cells initially come from an animal, is that is that right?

Speaker 2    10:17

This is right to the vegetarian and and and and the. And the vegetarian, I like persons which are who are about 5 to 7 % of the world population. But I think that the plant base and culture may need to be based. Substitute are looking to get the flexitarians and not the vegan and not the the vegetarian world. On the opposite side they want to go to the mass market and we believe that the mass market needs. A better feeding solution than cotton as I mentioned before to print the cotton cost about 11 times more to get a plant based hamburger for example.

Speaker 1    11:07

Ok, yeah. Are are plant based meat alternatives more acceptable in terms of Jewish and Muslim law, kosher and halal? Or are is the law the same for both plant and cultivated meat?

Speaker 2    11:26

Give religious guy I never thought about this question. It’s a good point but I don’t think so. Meaning you see that people are are are looking at the issues of eating meat at a different angles. One angle of course is halal and kosher but I think the bigger angle is why should we kill animals or the the issue of climate issues meaning. If you look at the if you take all the cattle around the world, this is the number one a pollution. Of the world of the climate, so people are concerned about pollution or climate issues, people are concerned about killing animals and people are concerned about eating healthier. If you take all these issues you see why people are trying to reduce their meat consumption and to have more and more plant based consumption or cultured meat. I think that people are willing to accept or wants to accept cultured meat. In if if if you know you will show them that it’s much better for them so it give you the. Ability to say it’s a myth we want to eat meat. Some of them. On the other hand, I’m not killing animals and I’m not disruption the Earth’s climate.

Speaker 1    12:58

So maybe you can take a few minutes and explain how how one goes about producing a plant based meat alternative.

Speaker 2    13:08

So you mean how they produce that in terms of how to produce the petty or what is the idea behind producing that?

Speaker 1    13:18

Yeah so starting off with the plant, how do you turn a plant into a meat alternative?

Speaker 2    13:24

Ok. So you you take the product, what you want to do is to have the same texture and taste as they need. So you you are trying to do to use materials that are natural materials, binders and colors etcetera that are natural. Natural in in their essence in order to establish the the plant based meat now you need to have protein, you need to have fibres and you need and you want to you want to have all the amino acids and all the good things that the meat will give you and not and not having the bad things such as cholesterols and others that they meet will give will will bring you. Now a lot of companies already done that. They are taking people protein or they’re taking chickpea protein or other sources of protein and we saw that that many, many companies already succeeded in introducing to the market plant based processed meat. What we don’t see yet, we don’t see the cut meaning the premium product, the stakes, the one the things now. If you allow me to give you my personal view here, I think that the. Plant based meat will will take and will take the market of the processed meat such as hamburger, burgers such as kebab, such as other processed food patties etcetera. While the culture of meat will take the market off the premium product, the stakes, the cut etcetera this is. In terms of cost effectiveness and in terms of what the consumer wants to see.