Investment in Israeli food tech doubles
The The Israeli food industry continues to expand. Currently, Israel is ranked second in the world for the number of cultured meat companies after the United States and third for the number of investors in the field of alternative proteins.
A recent report from Israel Good Food Institute showed that investment in Israeli food tech startups reached $320 million in the first six months of 2022, a 160% jump from the same period in 2021. Globally, investments in the sector between January and June 2022 reached $1.75 billion. , with Israeli companies attracting some 18% of global investment.
The report says that in the first half of 2022, Israeli plant-based food companies attracted $161 million in investments, or 22% of total global investments in this area. Israeli fermentation-derived protein companies attracted $152 million, or 38% of global global investment and second only to the United States.
Plant-based steak developer Redefine Meat takes the top spot in Israeli food tech investment with $135 million, followed by fermentation-derived dairy producer Remilk with $130 million.
Mermade Foods, based in Jerusalem, is the first company in the world to grow scallops in the laboratory. CEO Daniel Einhorn told Al-Monitor that the company raised $3.3 million in “challenging times” for the global market. He explained that originally Shit Foods, which launched in 2021, was targeting an investment of $2.5 million, but the oversubscription of around 30% shows investor confidence in the unique technology developed by this startup.
Einhorn explained that growing food in a lab is an expensive process due to the high prices of the fresh ingredients the cells are fed with. Mermade Foods, which plans to start commercial production in three years, has developed a method to recycle waste produced by cells using microalgae and then reuse it to nourish cells. This patent-protected method is intended to significantly reduce production costs.
Regarding the choice to focus on scallops, Einhorn said there is a huge market potential worth $8 billion globally for this product.
He added that his startup aims to “save the world from climate catastrophe”, saying the fishing industry and aquaculture are more harmful to our planet than the meat industry. Einhorn stressed that the company’s product will be “cleaner” and healthier than “regular” seafood because it will not include chemicals, antibiotics, microplastics or mercury.
Several well-established Israeli companies and funds are also involved in the growing agribusiness industry. The biggest is the Tnuva Group, Israel’s largest food maker and dairy producer. Earlier this year, Tnuva announced the creation of a new investment fund called Tnuva NEXT to invest in food tech startups.
Tnuva is also a partner in the Fresh Start Food Technology Incubator located in Kiryat Shmona, near the Lebanese border. Opened in 2020, Fresh Start participated in the incubator program set up by the Innovation Authority of Israel. In two years, it has made investments in 10 foodtech start-ups, including ProFuse, which operates in the field of cultured meat, and BlueTree, which has developed technology to reduce the sugar content of fruit juices. .
Speaking to Al-Monitor, Tnuva’s chief innovation officer, Shai Cohen, revealed that since its inception 18 months ago, Tnuva Ventures, the group’s venture capital fund, has made investments of worth $10 million. Tnuva, Cohen said, invests in different aspects of the industry, including research and development and production. He described Israel as a global powerhouse in food technology, particularly in the area of alternative proteins.
Cohen explained that one of the reasons for Israel’s success is its high-tech ecosystem, which includes a strong biotech industry, a strong agrochemical industry and a large medical industry.
This leadership is evident in the numbers. Cohen revealed that there are currently about 340 Israeli food tech companies and an average of 42 companies are created each year. Tnuva predicts that within a decade 15% of the global meat and chicken market will be based on alternative proteins and that by 2030 the global alternative protein market will reach a value of $300 billion. Another major trend predicted by Tnuva is the interest in products with a hybrid content of vegetable proteins and proteins produced by fermentation.
Israeli food tech entrepreneurs point to the industry’s importance in addressing food insecurity, particularly in the Middle East and North Africa, a region that is mostly desert and experiencing rapid population growth.
Naftaly Moser is a regional business consultant in high technology development with 20 years of experience. He believes Israel’s food industry can cement cooperation between Israel and its Arab neighbors.
Speaking to Al-Monitor, Moser noted that parts of the MENA region are already facing food shortages. It is no wonder, he said, that the Negev Forum, created earlier this year with the participation of four Arab countries – Morocco, Egypt, Bahrain and the United Arab Emirates -, as well as ‘Israel and the United States have decided to form a committee on food insecurity.
“Arab countries are obviously aware of Israel’s expertise in this area. Solving global insecurity as a whole may not be feasible, but alleviating food insecurity in our region certainly cannot. only be achieved through cooperation,” he said.