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    27 min read

    [S2:Ep #3] Next gen proteins in the mainstream

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    What makes a legit problem-solver in the next gen proteins space? Watch passionate entrepreneurs sharing their intel on this flavorful discussion hosted by Tommaso Di Bartolo, founding partner of Awesm Ventures: Navneet Deora, food engineer with a PhD from Indian Institute of & IT, Tony Martens, Co-Founder of Plantible Foods, and Elaine Simon, expert and influencer in the food industry in various categories in retail grocery and manufacturing, answer.

    Virtual Coffee: A Curated panel of industry fellows to discuss how to future-proof traditional markets

     

    In Season 2, recognized world-class Researchers, Scientists, Faculty Members, Senior Executives, Experts, Chefs, Investors and Entrepreneurs from around the globe, engage in strategic exchange of views and share startling intel on viable transformative innovation in Agriculture, Food and Beverage, zooming in the next gen proteins space. 

    With Special participation of

     

     

    [Industry Fellows] Virtual Coffee: S2:E3 

    avatar-10 

    avatar-11 

    Elaine Simon 

    Navneet Deora
    Tony Martens
    Elaine Simon
    Chief Technology Officer / Future of Food / Alternative Protein
    Co-Founder Plantible Foods - We're hiring
    KeHE Fresh at KeHE Distributors
     

     

    Host

    TOMMASO-AVATAR
     
    Serial entrepreneur w/ 2 exits, author, advisor, faculty, investor.
     
    http:///tommasodibartolo.com 
    Tommaso Di Bartolo
     
     

     

    Key points: 

    • Demand and supply in the next gen protein market
    • Scaling up!
    • How Covid affected the market of next gen proteins


     

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    Episode's 🔖 Transcription



    Tommaso: Virtual Coffee is here in our second season episode three, talking about alternative protein and we have an amazing line up jury and industry fellows joining us as panelists today to discuss this topic. 

    Navneet, and I would like to start with you. From your perspective as a researcher and advisor, what does the future hold for innovation in terms of benefits in alternative proteins? What are your thoughts? 
     


    Navneet
    : As you already told this alternative protein space is expanding, so my thought process right now, we are maybe from a commercial point of view, we're looking at soil tea as an alternative source of protein, which could be sustainable. But once the demand picks up slowly there would be enough requirement of more and more protein. 

     

    “So right now in this space, there is a gap of demand and supply, so they are not able to meet the demand of the consumer. As the alternative protein space increases with time, that's another five years, we would need to generate different ways and means in which we can have more plant based protein and that will drive innovation for the next five years.” 

     

    Let's say I was just speaking briefly about  protein from the year,  protein from seaweeds and technologies that can basically provide the right source of protein and meet the demands and how can we structurally need the protein which resembles meat. Of course the demand for this industry space increases.

     

    Definitely the innovation channel would agree that we need to find different ways and venues in which we try to work out different sources of protein. P and sawyer are one of them. But apart from that, we need to look at the carriers, the formulation holds the key, basically, and apart from that insight also holds the key. So in those areas we need to work parallely. We need a separate innovation in the area of technology. Right now, let's say globally, we are working in a platform extrusion technology to mass scale product into the actualized form of protein, but we need to devise in another ways that needs to rich the protein in different ways that instead of top down approach and what come up approach, both the approach should basically converse, make it a sustainable point of view. This is something I feel would be important for next five years. 

    Tommaso:  Elaine, question to you: How do the new startups in alternative protein scale their business, but not only here in the States but also abroad, considering this huge increasing demand? What are your thoughts on this, Elaine?
     

     

    Elaine: Well, if you look at the successful companies and protein companies in history, and let's say pork or beef or whatever, most of those companies have a vertical integration, meaning that they're from the grower or the farmer co-op to the finish good.

     

    “If the farmer doesn't know that it needs to be grown, to be made or produced for the source, they are not going to invest the time or the venture capital into developing the source.”

     

    So if we're looking at five years from now, there are probably analysts out there above my knowledge level that could analyze what the amount of volume would need to be done. There's a lot of farms, just speaking, not only in the United States but throughout the whole world that are looking for props and forces that they can be sustainable themselves and continue their family growth in history. So I think that we need to start with “what is the end product”. I can help you with the end product, how do we get it to market, but what we would really need to drill down with is where is the source going to come from and who is going to be involved in that and who are the people we need to reach out to, to help make that happen. 

    Tommaso: Do you want to add something to that, Navneet, in order to have distribution, maybe your perspective on that? 
     


    Navneet
    : Of course, the local policies have to be brought with government initiatives. Let's say I sit in India, so of course the government initiative should be the part of minimum government programs as one of the top priorities. We need to scale up Black Lives looking at the future. There has to be landscaping, in terms of which crops with the farmers can grow and which can definitely be of some commercial interest and we need to work basically systematically towards it. It has to be included in the government policies. 

     

    “We need to engage more and more government officials, so that basically the group of farmers are the leaders who work in the farm forming communities, those have to be involved, and have to participate so that they can understand the commercial interest.”

     

    Wherever there are more demands, more and more areas there has to be an export and import policy for different countries that also have to merge together. So let's say India produces X amount of quantity, the highest in the world, so there has to be some kind of a demand supply, so that we can globally meet the demand proteins. It is a synergy of different type processes, but the US government should be an equal participant in our discussion. 

    Tommaso: Now I would like to go back here to our panelists with the second round and this time I would like to start the second round with Elaine. Elaine, the topic of scaling/distribution supply chain is a big challenge. What is the most effective way to get actually alternative protein products into the retail, not only in the US, and maybe also abroad. So, production versus really placement. What are your thoughts on this? 
     

     

    Elaine: Well, obviously distribution comes from need. So, the consumer drives the need for the supply chain in the sense of at the end of the day, where is it being sold or bought. So when we look at the ease of getting things into it, there's a lot of trade shows that are out there, or were out there that drove industry, new items, one that is comes to mind is on the natural and organic show usually typically hold in Atlanta, or in Anaheim in March, would be have a section in within their trade show that would show and display all new products and a few years ago when I attended they had started with showing some of the alternate plan options and so forth. So, if you are targeting like the frozen food or say that you have alternatives that's a freeze dried product, or a dry like cereal type format, that would be an amazing show for you to attend, or what will come up in the future maybe it will be a zoom type roundtable meeting. I'm hearing a lot out there about that, where you as a supplier would attend and do like a conference with Costco, and you would sit at the table with Costco Spiers and present your product virtually through a roundtable format, but then if you look at the meat alternative or the meat section like say that you want to go after a burger, sausage or that type of application, then you'd want to do this, a similar thing within meat alternative meanings and one of those would be ECRM, which is a company that presents roundtable meetings and I'm sure that they're going to becoming more efficient in the zoom type of conferencing and so forth. I do have a conference coming up with one of the ECRM directors, just to get some knowledge as to how the future of that's going to look. 

     

    Tommaso: We've been calculating, especially startups that are big into direct marketing, meaning really from website to consumer, from ecommerce to consumer. What are your thoughts on this?

     

    Elaine: I think that's a struggle somewhat to get the mass amounts or mass volumes out there. If you look at the technology, and maybe we can talk to this as far as the technology, that the average consumer has the ability to.. I know that the virus has driven a lot more people to use their internet and an ordering system, but still the bulk of the amount of food that's consumed in the United States is still done through the grocery store industry or a market, so maybe if you're a small startup, you might want to look at a course or regional markets like within your community to just get started to get some consumer demand for it and then drive your business to that smaller markets, you know food markets, food chains and stuff like that.

     

    Covid and the market

     

    Tommaso: Tony, let me actually start and kick up things with you on an actual question regarding COVID and the impact of COVID. Has COVID impacted your business, your alternative, the meat market? What will come out of this pandemic? What are your thoughts on this?
     

     

    Tony: So first as a company, we took quite a drastic measure. So, actually when the lockdown was announced in California we started to have a two acre facility near San Diego. We bought a couple of beers and we converted some of our meeting rooms into bedrooms so the team has been self isolating in our facility for the past few months so that we can continue our work and can continue our operations. That has helped us to stay sane and also move on with our r&d pipeline as well as our operations. Then if you look at the industry, I don't know to be honest, I think there's a lot of news coming out regarding meat and meat production plants that's not really positive, it just shows that there has been little investment in maintaining, let's say, a worksafe environment.

     

    Then again, like in the past two months basically, every item in the retail or grocery stores has gone up significantly, so whether it's toilet paper or hand sanitizer. Everything that is shelf stable has gone through the roof and also plant based alternatives. The question of whether that's a sustainable increase, or whether that's just a current spike. Eventually longer term I really believe that we're going to move towards a more sustainable and healthier food supply chain, but I don't know whether their most recent numbers are representative of what it's going to look like in the next six to 12 months. It just shows you how fragile our food supply chain is overall and that there's definitely a need for improving the way we produce food and especially the way we produce protein.

    Tommaso: What is that crisp value proposition, how do you differentiate towards the bigger players? What's your take there? 
     

     

    Tony: I think the overall biggest critique that, let's say, Impossible and Beyond meat have received is due to their ingredient label, so that there are a lot of ingredients on there that people are not familiar with, that some might argue are unhealthy. But then again, they add those ingredients not to make the ingredient label more complicated, but to create a delicious product that people like to eat. I think that's the first barrier to get over and then I think they're successfully doing that. So if you want to be a new anchor in the market, you can create a product that is as tasty as an Impossible Burger and Beyond meat product. That was a cleaner ingredient label, then you definitely have a unique selling proposition.

     

    Elaine: I totally agree with that, Tony. My background is grocery retail and selling within the marketplace and I actually have a format of about six years in the meat industry doing production of foods and we are brought on some other hundreds of lines during that time period. So, at that manufacturing plant we saw the demand for it. I just want to say that you're very positive, you're right on the limited amount of ingredients. People don't trust things they don't understand. If you have to go to Google the ingredients, then you're not probably going to pick it up, especially are millennials and younger than even that, they want to be able to understand what they're eating and totally know, so for instance if you pick up a protein shake and it's got all these different things on it, but it says peas vintage and pineapple. What are you gonna buy? You're gonna buy because it's clean and you can understand the words that are within that. So, a challenge that's really phenomenal if you guys are heading that direction you're right on.

     

    I also want to comment back on the fact that you said you didn't know if alternatives are going to continue to grow. Before COVID happened in February I was in the process of presenting to Safeway and Kroger large extensive opportunities in plant based type items, so using them in solid production. Previous to COVID, I was working within a plant where we did whole meal replacement and process salads, and we were doing innovation on what we could do to add alternative protein to those ingredients. So if I were going to make a taco or Southwestern salad, instead of using beef, if I could find an alternative protein that would fit within that tasty innovative and again of course if I'm making an organic or green salad I don't want something that has all these massive amounts of ingredients that I'm going to add to my label for the consumer, right? If you go out and buy a salad, you want to be able to read everything..

     

    Tony: I agree, sorry, a small correction. So I do believe that plant based meat led light. I personally hate the term alternative, because it's just basically the next generation of products, but let's say that plant based meats, plant based dairy I do believe that there could continue to grow but I just don't know whether the most reason numbers that came out on let's say their sales in the past two to three months are going to be representative of how it's going to continue to grow in the next year, but then it will grow is without a doubt and then going back to the clean label ingredient overview of these plant based food products. It's a little bit of an unfair comparison as well to, let's say, your animal based counterparts, because in the end we feed a cow all kinds of antibiotics, vitamins, minerals, and they have a digestive system that then converts those ingredients into meat. But the meat producer doesn't have to put on the labels of what they've been feeding the cow. 

    Tommaso: Now, Navneet, let's switch gears towards markets and market opportunity from a geographical perspective because you're in India. What's the market like in India for alternative protein next gen food?

     

    Navneet: Maybe I'll talk specifically about the COVID crisis, and it has brought in a shift in thought process, that it does something I would always say keeps this would drive the entire market of plant based protein. Let's say my dietary choices can have a meaningful environmental impact. So that is something that can drive the plant based movement. In India, why there has been enough of a spike in the plant based movement is due to the field, there is a fear basically of the use of animals and transmission of the COVID viruses through animals. So there has been a bigger threat in terms of fear. That's why people are looking at the plant based options. 

     

    One of the primary factors is this, but if you need to sustainably grow this as a business, then there has to be a fundamental change in the thought process, and that you can break by an awareness campaign. So once we have a very good product that is something that sits parallely we should have an awareness campaign that will radically change the thought process. So we can change the food habits of thought processes to an entire community or entire families of students so that's how we can transform this industry. We run the walk the story is doing basically in my area. I'm really fascinated and the way in which it is impacting the environment and everything I think this becomes an inspiration to others, really happy to see his work. 

     

    Questions from the audience

     

    Tommaso: Now we switch to start collecting two or three questions depending on how much time we have left from the audience and we see here the first one coming in already. So right away for you, Tony. We have Lisa from UC Berkeley. Would you agree that to some extent plant based proteins require blending to provide a complete nutritional profile? is a question to Tony.

     

    Tony: If you look at what is currently available, yes. But then again, let's say, that's why we're trying to differentiate, if you look at the food supply chain and have been like this today for over 1000s of years. And the reason but we've just decided on specific crops because they were easy to grow and easy to harvest. And to do that, look at what we're trying to request from these crops today whether it's soybeans or wheat or rice. I mean, they were never designed or chosen to be used as protein sources for plant based meat or plant based dairy, but they just happened to be available in bulk. I think there are substantial plant based proteins out there in nature that haven't been commercialized yet, that do have the nutritional values that animal based proteins can offer you, but they just need to be explored and commercialized. So, yes to what's currently available, but no in general to plant based proteins or plant based ingredients.  

    Tommaso: We have another question here for Navneet. This one is coming from San Jose. Louie asks: what are sustainable proteins? Can sustainable food production scale to feed the world? Navneet, can it scale to feed the world?  What is it actually?

     

    Navneet: We only focus on proteins. We can't be eating proteins throughout our day life so we need to basically have a food system that can bring in a whole lot of nutrition that has a balanced carbohydrate protein, apart from all the micronutrients that can be balanced but any three of the agree agriculture revolution can basically limit the use of water as a lower impact factor in terms of economic activities.

     

    Tommaso: Tony, what are your thoughts on this?

     

    Tony: Now I think it's absolutely scalable because if I would say it wouldn't be scalable, then what am I doing today? I think the problem with building new, more sustainable supply chains is that it doesn't happen overnight. And it's a little bit of the chicken and the egg, so it looks very selfishly if you think about it, it first comes down to developing a product that consumers actually want. So whether it's a protein, whether it's a fiber, whether it's a fat. It's something that needs to appeal to consumers. And if it doesn't appeal to consumers that you can still build something but then there's just no market for it. 

     

    Then find your target market and figure out how you're going to expand your production capacity, but that's going to take time because will require substantial investments in infrastructure and hardware, which from if you're looking at a pure and investor perspective, isn't always as appealing as a consumer product, because the time to bring it out scale it up is much longer. It can be riskier, but the payoff down the road can be much larger. I do think it's scalable, it depends on what kind of technology you use obviously I think there's a lot of technology being developed right now, that might have a longer route to market to be scalable than others, but I think overall, if you have a product that appeals to people, and you're able to sell it, then there should always be a way to scale your production process.

     

    Tommaso: I see one last question maybe for Elaine has coming in and as the last one before we really wrap up things. This is from the East Coast, and is coming from Boston. Sophia is asking if in 30 years we will no longer need to kill any animals and old meat will either be clean or plant based? Why are plant based or healthier? Thoughts on this we can circulate to ask questions. 

     

    Elaine: Just to clarify the question again. So, in the future, no protein from animal sources, correct? I believe that's a possibility. I think there is a future for that and just back to like what Tony is saying there's the infrastructure that's spending we need to be set within the world itself and in place within the farmers, and the knowledge of growing and producing items and if we can, I guess, approach this as a community as a future of people that want sustainability within the food source, we need to turn to the farmer. We need to turn to the grower and the producer and ask them to be a part of this because without them that's never going to happen. Is there enough space of land in the world? What about the oceans? You know seaweed and those types of things. How many consumable sources are those? So, I think as you look at universities and colleges and schools that are looking at innovation and the world's future for food coalition they all need to be brought into a summit group of individuals with the knowledge to look at what it needs but what we need to do within the next 30 years.

    Tommaso: Awesome. Anyone would like to add something to it in 30 years?

     

    Tony: Yeah, sure. I think it's definitely possible, so once again it comes down, I think a good CPG has three critical factors, which is stakes, price and access. So we can create plant based foods that are better tasting healthier and more affordable and more accessible than animal based counterparts. It's definitely feasible and I think this will need to be driven by consumers, by investors, by companies, by entrepreneurs, but also by the government. 

     

    It's because the animal based food sector is heavily subsidized and allowing them to offer foods at a very low cost, clearly their working environments are horrible which leads to employees being incredibly prone to diseases, making it cheaper to produce whereas the new entrants in the market, they're under a microscope,  they need to show that their food is safe, they need to be healthy, they need to be clean and everything, whereas with that traditional food supply chain nobody really cares because it's been there for ages. But if we can overcome those barriers, then definitely I see a huge opportunity for people to create more delicious and more affordable products because in the end, you know, you can actually decide how you're going to create the product, so it gives you the opportunity to design it in such a way that it's healthier better tasting, and hopefully also down the road more affordable to their animal base kind of.


    Source of inspiration

    Tommaso: Ladies and gentlemen, industry fellows, panelists, but it goes into the topic of innovation and inspiration of innovation. Maybe we would like to start with ladies first. Elaine, what's your source of inspiration? Could be a blog, a podcast. Where did you learn about how to innovate? Maybe a very quick answer and the name of what is it?

     

    Elaine: Actually, most of my innovation comes from looking at the Internet, and looking at what top recipes are being enjoyed by restaurants. So, I would look at the restaurant industry and see what's happening there. All chefs in the world can create an unbelievable amount of products and how do you take that recipe and make it something that's sustainable.

    Tommaso: Navneet, what's your service of innovation?

     

    Navneet: So, I'm in the area of food. So I personally believe dietary choices have a meaningful environmental impact. That is what I see on my daily basis, and that drives me to do something meaningful in life. And if I can do it through the medium of food that is something that I basically look forward to, each and every day.

     

    Tommaso: Awesome. Is there any specific source that you read, that you're inspired by and you want to share with the audience? If not, that's okay. 

     

    Navneet: Of course. I follow the basic patterns globally, what's happening in Impossible Food and Beyond Meat. If the founders of all those evolution basically I read more about it. I try to understand the thought process and that gives me inspiration to walk around.

    Tommaso: Awesome. Tony, what's your inspiration for innovation?

     

    Tony: So I tried to read a couple books per year and they can be completely industry unrelated, so from different industries. So entrepreneurs, politicians, whatsoever and how they tried to innovate in their specific sector because I just want to understand the way they think, the way they approach stuff and then I can see how I can apply it to my own environment. 

    Tommaso: What’s your most recently read?

     

    Tony: I recently finished a book that's called “how to fail at almost everything and still win big” by Scott Adams. Highly recommended. It's a great read, and now I am reading a book by Chris Voss, it's called “never split the difference”. So he was a former FBI hostage negotiator, so he takes you through all his negotiations and his experience. I am halfway through, but it's amazing, so I also big recommend it. 

     

    Tommaso: Elaine, Navneet and Tony thanks for being here. We just had an insight about innovation and what sources they inspire and based on innovation inspiration I would like to finish with my raise, with my sensor, with my motto that I learned to craft throughout the years as an intrapreneur, who switched eventually table and went into investments in academia, which is the following:

     

    Tommaso: “Never forget where you come from, it keeps you humble. But where you come from, cannot limit you where you want to go.”

     

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    And this series is brought you by:

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    SiliconVal.ly: The Innovation institute focused on helping future-proof corporations in traditional industries. http://www.siliconval.ly .

     

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