From Trend to Transformational Shift: How 2019 paved the way for the 2020s to be the decade of protein revolution

2019 was a big year for food technology, and an even bigger one for alternative proteins. Many notable developments over the year accelerated a shift towards alternative protein adoption. Moving into the 2020s, the scene has been set for a protein revolution to take hold, and the new decade could bear witness to a step change in how we feed the world.

Just some of 2019’s key developments included…

Alternative proteins gaining mainstream acceptance. The latest data shows double-digit growth across plantbased categories, in contrast to low single-digit growth or stagnation in many conventional meat categories. This shift is driven by an increasingly mainstream consumer – flexitarians and other meat “reducers” who are aiming to incorporate more plantbased options into their diet. Against this backdrop, several analyses this year have predicted the growth of the market in the next decade. Conservative predictions are for alternative proteins to mimic the growth in plant-based milks over the past decade and to reach 10% of the total market in 2030, while more radical forecasts predict the collapse of the entire cattle industry in the same period.

Excitement around the space led to heightened interest from venture capital. A growing number of investors want to grab a piece of this hot category. From plantbased start-ups to cultivated meat, a plethora of new companies entered the space this year and announced successful seed funding, while many existing companies expanded their investor support to raise larger rounds. For cultivated meat specifically, over $80M of publicly disclosed investments fuelled development in 2019, including Series A rounds for Aleph Farms and Future Meat Technologies. 2020 is set to be a remarkable year for cultivated meat, with more potentially game-changing news on funding for the space, technological breakthroughs and scale-up to come early next year.

The next generation of alternative proteins is arriving. 2019 saw not only multiple new companies enter the space – but also bore witness to serious advancements in technology. From 3D printing to discovery and optimisation of novel proteins, the next generation of start-ups and technologies are upping their game. On the plantbased side, companies are exploring ingredients beyond soy and pea and are advancing biomimicry. In cultivated meat, meaningful strides were made this year, with public demonstrations of multiple products and paths to market beginning to emerge.

Public markets demonstrated they were ready for alternative proteins. The first pure-play plant protein opportunity, Beyond Meat, listed on Nasdaq in May in a blockbuster IPO and was one of the most successful of 2019. The company’s listing price of $25 per share surged 163% during the first day of trading and settled at around $75 per share at the end of 2019. Beyond Meat’s performance was in stark contrast to the many long-awaited IPOs from a host of tech unicorns which proved in reality to be flops – from Uber to Peloton and Slack, and of course WeWork’s abandoned attempt. Institutional investors’ awareness of risk and opportunity in the sector also increased, as evidenced by rapidly increasing support for the FAIRR initiative, with membership now over $20 trillion of combined assets.

Big food ramped up attempts to keep pace, and incumbents increased focus on ESG and sustainability. The largest food industry players, from Unilever to Tesco, took meaningful steps to innovate and keep pace with the developments led by start-ups and powered by VC, realising that the need for them to innovate is greater than ever. Other developments indicating a broader shift towards sustainability from the private sector included the Business Roundtable redefining the purpose of a corporation away from longheld principles of shareholder primacy to one that serves the needs of all stakeholders, including the community and the environment.

Urgency for a protein shift only intensified. Climate change manifested itself in the most catastrophic wildfires on record in multiple regions, from California to Siberia, and with Australia in a state of emergency as we end the year. Against this backdrop, COP25’s talks proved disappointing in terms of tangible progress, reinforcing the need for action from the private sector in the absence of governmental leadership. African swine fever continued to ravage pig populations, most fiercely in China. Hundreds of millions of pigs have been killed in response to the disease which is spread globally, impacting markets and incentivising businesses to look for alternatives. Elsewhere, deforestation and ecological devastation in Brazil meant more scrutiny for beef producers.

As the alternative protein sector gathers pace, it is also facing challenges. Product formulators must step up their game on nutrition, with some of the most popular products starting to receive push-back on health claims and a growing backlash against companies who cannot demonstrate their clean label credentials. With health a major driver of adoption, this is a factor that companies cannot afford to ignore. The emerging alternative protein industry also faces ongoing challenges this year on the regulatory front, specifically in terms of labelling, where key battlegrounds are emerging. In the US, nearly 30 states have introduced legislation to ban terms such as “beef” or “meat” for alternative proteins. Companies have also faced challenges in scale-up, with some sector leaders including Impossible Foods and Oatly struggling to meet demand. Concerns around the potential energy intensity of cultivated meat have also started to emerge, an issue which the sector also needs address in order to live up to its reputation as lower impact.

So 2019 was a big year. But what can we expect in 2020 and beyond? The signs suggest that the fourth agricultural revolution is truly underway for protein production. The question now is just how quickly this revolution will take hold and transform the world’s largest industry.