Tasty slice of funds
Memphis Meats raises $17 million
Memphis Meats, a San Leandro company that is culturing animal muscle cells to create slaughter-free meat, has announced that it has raised $17 million in funding.
In the field of meat alternatives, as much a cause as a market that addresses concerns about sustainable agriculture, climate change and the treatment of animals, news of investment rounds and acquisitions have been as notable for the investors as for the dollar amounts raised.
For Memphis Meats, the private investors include A-listers such as Jack Welch, the former CEO of GE; Richard Branson, founder of the Virgin Group; and Microsoft co-founder Bill Gates. The latter, in particular, has backed a number of alternative-protein companies over the past five years, including Hampton Creek and Impossible Foods.
In this new round of investment, led by venture capital firm DFJ, the biggest eyebrow-raiser was not an individual but global agribusiness giant Cargill.
“This will accelerate our work on moving products to lower costs, developing a production environment and getting a much better handle on the multiple species we’re working on,” said Memphis Meats CEO Uma Valeti. Memphis Meats would not state how much money each investor contributed, nor the terms of the deal.
The company, which was founded in 2015, has already held private proof-ofconcept tastings for beef meatballs, fried chicken and duck a l’orange. Valeti says that the company will continue to refine its work on meat based on these three animals, as well as others he would not yet discuss.
Silicon Valley has responded with market-based enthusiasm to the field of meat alternatives, which promises to change the way the world produces
“This will accelerate our work on moving products to lower costs.” Uma Valeti, Memphis Meats CEO
food and alleviate some of the effects of animal agriculture on water use and greenhouse gases. Many of the companies in the field, including Memphis Meats, are based in the Bay Area because of the proximity to tech talent and investors.
The deal represents multiple firsts, says Bruce Friedrich, executive director of the Good Food Institute and co-founder of New Crop Capital, which participated in this round. “The first investment by a traditional meat industry company, the first investment by one of the big venture capital firms, and the first time people like Bill Gates and Richard Branson have invested in clean meat,” he said. “Clean meat” is the term the field prefers to use to refer to meat made from cultured animal cells.
According to the Plant Based Foods Association, the U.S. market for plant-based meats in 2016 was $606 million, and sales continue to grow. Besides Cargill, other large food companies are increasingly showing interest. Pinnacle Foods, which owns Armour Meats and Birds Eye, acquired plant-based meat company Gardein in 2014. In 2016, Tyson acquired a 5 percent stake in Beyond Meat, which manufactures pea-protein chicken and beef alternatives.
This new round of investment brings Memphis Meats’ total funding to $22 million. The company plans to quadruple its staff (15 people currently list it as an employer on LinkedIn). Valeti emphasized that Cargill will contribute its expertise in meat science to Memphis Meats, while other investors in the round, including SOSV and New Crop Capital, will help improve the company’s processes for culturing meat cells.
Previously, Valeti had estimated that it would take five years for Memphis Meats’ products to reach market, and much longer to produce them at mass-market prices. Valeti said that this round of investment will accelerate that timeline, but would not estimate by how much.