Believer Meats ceased activities at their Wilson County, NC. plant during mid-December.
The company has deep technological roots in Israel with Dr. Yaakov Nahmias, Professor of Biomedical Engineering at the Hebrew University, serving as the founder and motivator. The company attracted initial VC funding approaching $350 million by 2021. Investors included Archer-Daniels-Midland, Tyson Foods, S2G Investments, Neto Group, the Jeff Bezos Earth Fund and others in the entertainment industry. Believer Meats along with competitors recently received a “no questions” authorization from the Food and Drug Administration with respect to the safety of their technology.
With a budget exceeding $125 million for the Wilson production complex and a market valuation of $600 million Believer Meats generated considerable buzz in the alt-meat space despite a succession of failures among competitors including Eat Just, Upside Foods, Meati and Beyond Meat. The final blow to Believer Meats was the defection of a major backer creating a cash crunch exemplified by the $34 million lawsuit filed by Gray Construction the prime contractor for the 200,000 square foot facility.
Industry observers attribute the failure of the company to aggressive implementation of technology that was not proven for the projected scale of production. Success with 200-liter reactors was not realized with vessels in the 10,000-liter range. Initial production for the plant was projected at 21 million pounds with the possibility of doubling output to reduce the high fixed costs incurred. Believer Meats projected that with scale, theoretically achievable in the Wilson plant, the shelf price of their chicken product could be reduced to approximately $7 per lb. Workers at the facility noted that during the commissioning process, there were considerable problems with equipment preventing initiation of production.
Despite the technical issues encountered by Believer and its competitors, there is considerable doubt as to the demand for lab-cultured meat. In addition, a number of beef-producing states have enacted legislation banning production or sale of laboratory-derived meat products. Other states have imposed strict labeling requirements that would have dampened consumer acceptance in the event of commercial quantities of product becoming available.
There was no outward indications of the perilous financial state of Believer Meats leading to precipitous termination during pre-production commissioning. For weeks management issued self-adulatory comments on progress and persisted with rosy predictions of consumer demand.
The failure of Believer Meats cannot be regarded as a temporary speed bump for alt-meat production. The loss of investment capital will serve as a warning to VC companies willing to place bets on long-shot enterprises that have projected an aurora of sustainability, environmental protection and the possibility of a radical change in production of protein.