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A Company I'd Like to See: Hybrid Animal / Plant-Based Meat

Cell-based meat is a potential solution to the important problems posed by factory farming, but the path to mass adoption will be difficult. As price falls over the coming years, cell-based meat companies will feel pressure to find revenue streams before they can compete with e.g. grass-fed beef.

One commonly discussed path to commercialization is “hybrid products”–partially made from cultured cells, and partially made from plant-based material like soy. Hybrid products would be cheaper than full cell-based meat due to the lower concentration of the most expensive ingredient: animal cells.

This hybrid meat could also potentially carry many of the taste benefits of cell-based meat. Super Meat, in their 2017 patent application, conducted an experiment where they measured the tastiness of plant-based meat with varying amounts of cultured liver cells mixed in. Their results are surprising–there is a substantial jump in tastiness after only 13% cultured cells, suggesting that hybrid products could contain cultured meat as a relatively minor ingredient [1].

However, there isn’t a currently market for plant-based meat with a small percentage of animal cells. Meat extenders exist [2], but extended meat is still mostly animal meat by volume, and is marketed in the same way as conventional meat. There are also some burgers blended with mushroom [3], and some UK companies with other types of blended meat [4]. However, none of these options are widely available, and all have a higher percentage of animal cells than I’m suggesting.

Lack of an existing market will make it difficult for cell-based meat companies to make hybrid products. In CPG and food, defining a new product category has a high risk of failure, even if the idea is great. It’s impossible to say whether consumers would actually eat hybrid meats without testing the idea in the market.

The company I’m advocating would create non-vegetarian hybrid meats with animal meat rather than cell-based meat. The animal meat would make up around 15-20% of the product by volume. The products would be targeted at flexitarian consumers. It would likely be framed as plant-based meat with some animal meat for flavor, which would distinguish it from both vegetarian meat and pure animal meat.

The Mission Case

This idea may seem counterintuitive given that I’d like to completely get rid of factory farms. However, I think there’s a strong mission case for this company. There would be two main goals:

  • Lower animal meat demand in the short term.

  • Establish a market for hybrids products before cell-based meat is ready for commercialization, then eventually transition the animal meat to cultured cells.

This company would take some market share away from plant-based meat, and some market share away from animal-based meat. Roughly speaking, as long as the percentage market share it takes from animal meat is larger than the percentage volume of the product is animal meat (e.g. 15%), then the company should reduce meat demand in the short term.

In the long term, the goal would be to open up the hybrid meat strategy for cell-based meat companies. It will be much easier for these companies to commercialize hybrid products if there is a pre-existing market to move into. Having these intermediary revenue-generating strategies could be crucial to cell-based meat’s success since there is a big risk that funding will dry up before there is anything substantial to show.

The Business Case

According to Beyond Meat’s S1 document, 93% of their customers are meat eaters [5]. Plant-based meat companies like Beyond Meat have proven that there’s a substantial segment of “flexitarians” who try to reduce their meat consumption, but not eliminate it.

If one just considers Beyond Meat as a profit-maximizing business, it might seem strange that their products are vegetarian when most of their consumers aren’t. In a typical industry, this disconnect between a company’s products and consumer base would suggest the company isn’t serving their customers optimally. Of course, Beyond Meat has an underlying mission which leads them to not sell animal meat. However, this disconnect suggests a business opportunity to make meat products specifically targeted at flexitarians. Instead of eating vegetarian 85% of the time, flexitarians could eat meat that’s 85% vegetarian.

If Super Meat’s study is correct (I haven’t personally confirmed this), then hybrid products have the potential to taste better than current plant-based meats. Super Meat hypothesizes that hybrid meats taste better because of heme—the same secret ingredient that Impossible Foods uses in their burgers. Impossible Foods uses costly microbial fermentation to create its heme-containing proteins. However, animal meat is a much more abundant and cheap source of heme.

Differences From the Better Meat Co.

The Better Meat Co. is an exciting startup making plant-based meat enhancers. Their strategy is similar in spirit to this company’s, since both can reduce meat consumption in the short term. However, there are some important differences:

  • Better Meat Co.’s customers are meat businesses, while the hybrid meat company would try to define a new product category by selling direct to consumer. Better Meat Co. aims to appeal to normal meat eaters, while this company would aim to appeal to flexitarians.

  • The meat that Better Meat Co. enhances is primarily animal-based by volume, whereas the hybrid meat company’s products would be primarily plant-based by volume. In other words, for Better Meat Co., plant-based material is an ingredient, but for this company, animal meat is the ingredient.

  • Better Meat Co.’s goals is to create meat that’s indistinguishable from or better than 100% meat. This likely isn’t possible with a hybrid meat approach. Instead, the goal would be to improve the taste of plant-based meats.

Risks

In order for the hybrid meat company to be good for the mission in the short term, it must take market share away from conventional meat. However, if the company primarily competes with plant-based companies like Impossible Foods and Beyond Meat, it could actually increase meat consumption in the short term and cause harm.

Another risk is that cell-based meat companies decide not to commercialize hybrid products at all. In this case, there wouldn’t be substantial long-term mission benefits for hybrid meats.

A final worry is that marketing this product could reinforce the notion that animal meat is necessary for meat products to taste good, which could hurt plant-based meat in the short term.

Overall, I would like to see this company exist. There would be a lot of research needed to confirm it’s a good idea–in particular, replicating Super Meat’s experiment. Normal companies are at worst neutral if they fail, but this company could actively cause harm. Therefore, it’s worth being cautious. As the company is developing, if it becomes clear that these risks are materializing, the founders should be prepared to abandon the idea.


Even though I think the company is a good idea, I likely won’t work on it myself because I would find it personally difficult to source and sell animal meat. If you’re interested in working on this company, feel free to get in touch and I’ll connect you with others who have also reached out.

Footnotes

[1] Based on conversations I’ve had, it’s unlikely that meat with such a small percentage of animal cells would stand up to in blind taste tests with 100% meat.

[2] Based on my conversations, meat extenders are less common than people tend to think, even for low quality meat.

[3] For example, Sonic currently has a 25% mushroom-blended burger, and Kimbal Musk was working on a 50% blended burger.

[4] See here, here and here. Thanks to Paul Shapiro for bringing these to my attention.

[5] This statistic is just for consumers at Kroger, but it likely generalizes.

Robert Yaman6 Comments