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Roadmap to the Cellular Agriculture Era


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How would recent surge of public interest in cell-based meat play out for the industry? Hype cycle? Price parity? Disruption? What will we see when cell-based meat enters mainstream? Monopoly mega-corporation? Home meat breweries? Generally speaking, when?

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Roadmap to the Cellular Agriculture Era

  1. 1. The roadmap to the cell-ag era
  2. 2. Scenarios of cell-ag entering mainstream Time Cost-benefit (Customer satisfaction divided by the price) conventional meatPrice Parity(PP) PPNow Vertical integration Horizontal specialization Scenario 1 “Before PP” Scenario 2 Scenario 3 cell-based meat Will the cost-benefit (incl. taste, texture, and cost) of cell-based meat ever exceed conventional meat? What would the business model surrounding cell-based meat be like if price parity (PP) is exceeded? Scenario 1: Before PP Scenario 2: Vertical integration Scenario 3: Horizontal specialization
  3. 3. Scenario1:Before PP ・The cell-based meat hype may peak 2021〜2022 ・Initial products would be limited to nuggets, foie gras etc., and generally fail (overblown) expectations. ・Would get through the worst in 2030s, but the share would be 0.1% ・But the PP will eventually be met as technologies advance. ・Companies need strategies to go over the trough of disillusionment “Hype cycle” https://en.wikipedia. org/wiki/Hype_cycle PP Met
  4. 4. When the PP nears in (late 2020’s) Animal welfare organizations would serve as the “canary” - Seeing more posts like “Let’s everybody eat XXX (specific cell-based product brands)” on socials networks, is the sign of PP closing in. Meat industry lobbying is already resisting - The main arena would be in marketing, categorization, and food safety and labeling regulations. - Bold forward moves will be found in regions with little meat industry lobbies like Singapore. Pro and anti lobbies fight across “The Chasm” by sending messages that target “Early Adopters”.
  5. 5. PP Reached = Disruption Renewable energy: What used to be “naive nonsense by environmentalists” in the 80’s - now the top national prioritiesGlobal protein market capitalization: $2T Photography: Fujifilm and Kodak ・The cost-benefit of cell-based meat will gradually increase to the PP. ・PP is reached earlier in beef than chicken and in Japan than in the US. ・A disruption occurs when the PP is met. Surrounding industries like processing, packaging etc. will also be affected. ・Unexpected entrants to the market, i.e. Nvidia (computer parts) entering automotive industry with autonomous vehicles.
  6. 6. Disruption sequence and entry barrier from the start Foie gras $55/kg Tuna $28/kg Seashells $23/kg Crab (edible part) $40/kg Pork, chicken $2/kg Beef $4/kg Japan $22/kg Price parity reached by unit prices, “disruption” occurs accordingly (As all products would be based on the same technology, entry from the middle i.e. tuna may prove difficult.) Hong Kong $17/kg Singapore $12/kg Germany $11/kg USA $11/kg Beef consumer prices (2019)
  7. 7. Scenario 2: “Vertical integration” ・2 to 3 cell-ag companies per country (like automotive industries) ・Capital intensive industry with big advantage in economy of scale ・Foxconn-style “cell culture foundries” may break vertical integration ↑Transport of amino acids to cell-ag plant with big tankers ←Littoral petrochemical plants are replaced by cell-ag plants
  8. 8. ・Equipments and ingredients are commodities, like restaurant industry ・Millions including in China, India and Africa culture meat ・Open source cultured meat, Nonproprietary recipe, DIY cell culture vats Scenario 3: “Horizontal Specialization”
  9. 9. Scenario between 2 and 3(i.e. Beer industry) Ohwaki Engineering CO.From hp of Sapporo Beer ・Local and private brewery brands alongside big brands ・Big brands leverage on the economies of scale ・Small brands target local and niche markets ・The required capital for market entry generally decreases with advancing technology (i.e. AI & automotive), and the scene eventually shift to Scenario 3? PicoBrew : Beer brewing machine for home-use Mass brand companies Local brewery Home brewery
  10. 10. ・The size of capital for market entry at the point of price parity decides which scenario to occur. ・Actions of animal welfare organizations and regions like Singapore would hint the nearing price parity. ・Other cell-ag (fur, timber, seafood etc.) products may follow the same path. Size of capital for market entry time PP not reached Vertical integration Horizontal specialization Cell culture & cooking not distinguished Democratization Reach PP in scenario 2 Reach PP in scenario 3 Likely scenario from 2030s How would cell-ag enter mainstream?