Anthony Chow: “We’re the biggest fish in a very small pond”

In the 1952 science fiction novel The Space Merchants, a sinister corporation feeds the masses with slices from a colossal hunk of genetically engineered meat. During a scene in the 1977 horror film Eraserhead, a man-made chicken spontaneously spurts a horrifying dark goop, sending a disturbed family fleeing from the dining table.

But today, Anthony Chow’s company is betting roughly £27m that the idea of lab-grown meat will, very soon, seem a lot less dystopian. 

Chow is co-founder of Agronomics (ANIC), an Aim-traded investment firm launched in 2019 “with a focus on cellular agriculture and cultivated meat”. Its invested assets, which at the end of last year stood at £26.9m, now include stakes in 16 start-ups. Among them are Singapore-based Shiok Meats, which grows cell-based shrimp; German company LegenDairy, which produces cheese without cows; and VitroLabs, which says it “can make billions of square feet of leather” using the cells from a single animal.

Amid growing awareness of the harm intensive farming does to the environment and animals, interest in alternative ways to feed the planet is growing. Over $270m (£194.11m) was invested in the "cultivated meat sector" last year, nearly 60 per cent more than in the previous four years combined, Agronomics says. But as a listed firm Agronomics’ focus on this area is unique.

“We’re the biggest fish in a very small pond... there is nothing else like this,” he says during a video call, sporting a black baseball cap featuring the logo of Bond Pet Foods, an Agronomics portfolio company that grows chicken meat for dogs. While others are piling money into alternative proteins, he adds, their motivations are largely philanthropic. But Agronomics sees a significant profit opportunity in man-made meat.

The entire sensory profile

The manufacture of animal parts, which to most of the world remains the stuff of science fiction, can be traced as far back as 1912 when Nobel Prize-winning scientist Alexis Carrell set out to prove that cells were “immortal” and removed tissues from the heart of a chicken embryo. Carrell and his assistants later claimed that they continued to grow these cells over 34 years, although doubts have since been cast on their honesty as other scientists have been unable to repeat the experiment.

Just over a century later, the public got its first real glimpse of man-made flesh. In front of a TV audience in 2013, Cornwall chef Richard McGeown fried a blood-red slab of cow meat composed of 20,000 lab-grown muscle fibres before serving it to food critics with a burger bun and salad.

The hamburger, produced with funding from Google co-founder Sergey Brin, cost €250,000 (£218,102) to make. Taste tests suggested the flavour wasn’t worth the price tag. “I was expecting the texture to be more soft,” said food critic Hanni Ruetzler. “It’s close to meat, but it's not that juicy.”

Since then, dozens of start-ups have launched in an attempt to create something that tastes as good and costs the same as the real thing. Mosa Meat, whose co-founder was the scientist behind the €250,000 hamburger, says its patties could soon cost €9 each to produce. Last year, Eat Just became the first company to sell lab-grown meat to consumers after Singapore gave regulatory approval to its chicken nuggets, which then cost up to $50 a piece. Researcher Olivia Fox Cabane has identified at least 60 companies currently working in the space, one of which says it can use 3D printing to make ribeye steaks. Bill Gates, Richard Branson and Softbank (JP:9984) have all thrown their money behind the efforts.

Chow expects man-made meat to achieve “cost parity” with slaughtered meat within a decade, as businesses scale up production. But he is yet to try any himself, as the pandemic has limited his ability to visit companies in person. With lab-grown meat still not approved by regulators outside Singapore, even some of the companies’ founders haven’t been able to taste the fruits of their labour. 

But there are numerous reasons why they are eager to find an alternative to harvesting meat from animals, Chow points out. Every year, up to 2.7 trillion fish and 80bn other animals are slaughtered to feed humans. While morally objectionable to some, the environmental effects of farming on this scale are becoming increasingly hard to ignore. The production of animal products has been estimated to account for nearly a third of the world’s freshwater use, while the food production chain is believed to cause up to 37 per cent of global emissions. Chow adds that many farmed animals are fed antibiotics, which creates resistant infections that can be passed onto humans – a factor that should only influence consumers more after the coronavirus pandemic.

But the reason most people haven’t changed their diet is simple: they like the taste of animal products. In recent years, numerous plant-based meat imitations have arrived on supermarket shelves and one of the biggest producers, Beyond Meat (US:BYND), has been a hit with investors since going public. But most consumers haven’t got on board: vegan alternatives grabbed only $800m of US sales in 2018-2019, compared with $74bn for meat, according to The Good Food Institute.

Even Chow, who is dedicating his working life to backing alternatives to slaughtered meat, has not managed to cut it out of his diet.

“I’m broadly representative of the majority of the population," he says. "I’m definitely trying hard to reduce my meat consumption but I find it very, very hard. The entire sensory profile, the taste, the texture. I just think that [the vegan alternatives] leave things to be desired.”

But while plant-based burgers haven’t persuaded him to stop eating animal products, he says confidently that he will switch to lab-grown meat once it is available.

The rising tide

It remains unclear how many people would join him. Lab-grown meat could eventually taste just like it came from a slaughtered animal, but the flavour alone will not reassure all consumers. A survey by researchers at The Good Food Institute found that less than a third of US respondents were “very likely” to buy it – although this compared to more than 56 per cent in China and India. 

One study has also cast doubt on the popular opinion that switching to man-made meat and avoiding the need to rear livestock would be better for the environment. In 2019, researchers at the Oxford Martin School said that the energy used to produce this meat could actually be worse for global warming, if it did not come from sustainable sources.

Lab-grown meat won’t even face the consumer test until it is ticked off by regulators. The US has established a framework for how these products will get approval and Chow expects some to go on sale in that country by the end of the year. He anticipates this will happen in the European Union by 2023.

Agronomics does not have a diversified portfolio of investments, although it also has stakes in LiveKindly, a plant-based food producer, and Solar Foods, which says it can produce protein “out of thin air” by mixing carbon dioxide with nutrients. Agronomics is mostly making a big bet on a single trend.

“If you have a strong view that [cell agriculture] is never getting to scale, then this is not the investment vehicle for you,” says Chow.

But he is not a stranger to banking money on experimental science. For almost 14 years, he has worked alongside fellow Agronomics founder Jim Mellon seeking opportunities in the biotech sector. In 2017, they set up Juvenescence, a firm that invests in therapies for extending human life. Mellon, a multi-millionaire who now sits on Agronomics’ board, earned his fortune making precocious bets on uranium and the Russian stock market. More recently, he has made headlines for bankrolling the Brexit campaign from his base in the Isle of Man where Agronomics is headquartered.

Agronomics is already convincing a lot of investors that the future is in lab-grown meat: its shares are up 147 per cent over the past year alone, giving it a market capitalisation of about £90m. But it is difficult to know how Agronomics' investments should be valued at such an early stage in their development.

Some, if not all, of its portfolio companies are multi-billion dollar businesses in the making, Chow believes. He is counting on these start-ups eventually being acquired by meat-processing giants such as Tyson Foods (US:TSN) and Cargill, who have the capacity to produce lab-grown products at scale. These firms, aware of changing consumer attitudes, are certainly looking for new opportunities: both have already supplied early-stage financing for Memphis Meats, a cell-based meat start-up.

Winston Churchill once predicted that humans would “escape the absurdity of growing a whole chicken in order to eat the breast or wing, by growing these parts separately under a suitable medium”. Writing in 1931, he suggested that this would happen by the 1980s. More recently, consultancy AT Kearney has set a target for man-made meat to grab 35 per cent of the market by 2040.

For some, the change is inevitable, whenever it comes.

“The reality is, with meat consumption where it is today, we are not able to feed the world’s population sustainably," says Chow. The industry "needs to make it easier for consumers by [giving] them the same thing they’ve been used to eating. We see [Agronomics] as a bet on the rising tide of cellular agriculture.”