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Asia Pacific alt-protein funding almost doubled last year, but region trails on fermentation: GFI

March 2, 2022

Funding for Asia-Pacific startups working on plant-based proteins, cultivated meat, and protein fermentation increased by 92% last year, according to figures released today by GFI APAC – the Good Food Institute‘s regional chapter.

Total funding across all three subsectors in Asia Pacific hit $312 million in 2021 – almost double 2020’s $165 million total.

That’s compared to 60% growth in alt-protein funding worldwide, from a global total of $3.2 billion in 2020 to $5 billion last year – showing that Asia Pacific has one of the fastest-growing meat-replacement startup scenes.

But the region is falling behind when it comes to mission-critical fermentation technologies, said GFI APAC acting managing director Mirte Gosker.

Image credit: GFI APAC

Less than 10% of the region’s total alt-protein funding last year went to this subsector, compared to 26% in Europe and a whopping 46% in North America.

This is important because fermentation has the potential “to almost single-handedly resolve the global protein deficit,” the nonprofit states.

“Put simply, Asia has a lot of catching up to do,” Gosker told AFN. “Even within [Asia Pacific’s] $30 million of fermentation-enabled protein investments, Australia-based companies constitute the bulk of that – inn particular, All G Foods raised $16 million, Nourish Ingredients raised $11 million, and Eden Brew raised another $3 million.”

Could North America become ‘minority player’?

GFI’s analysis — which is based on data from PitchBook — indicates that, counting all three subsectors, Asia Pacific now lays claim to a larger share of global alt-protein funding than ever before.

North America continues to dominate, with two-thirds of total funding going to its startups. Asia Pacific secured 6% of global funding, up from 5% in 2020 and just 1% back in 2015.

But it still falls behind Europe — which took 10% — the Middle East, which was thrust into second place on 11% thanks to a couple of cultivated meat mega-rounds in Israel.

Aleph Farms$105 million Series B round in July — which saw participation from investors including L Catterton, Cargill, BRF, and Thai Union — and Future Meat‘s $347 million Series B in December, which was co-led by ADM, ensured that Europe dropped to third place; marking the first time since GFI began its analyses in 2010 that it has not placed second behind North America.

Image credit: GFI APAC

However, GFI APAC makes the point that Europe saw an increase in liquidity events for “mature companies” last year, such as the $13 billion IPO of plant-based milk brand Oatly. When such events are included in the calculus, Europe’s alt-protein funding total for 2021 hits $2.5 billion, putting it firmly in second place.

Nevertheless, Asia Pacific alt-protein funding is on a rapid upward trend, according to GFI APAC’s analysis – which notes that the region has already witnessed a handful of substantial deals in the first two months on 2022, including $100 million rounds for plant-based protein producers Next Gen Foods and Starfield, which are based in Singapore and China, respectively.

In a statement, GFI APAC suggests that there’s a “distinct possibility” that, by as soon as next year, North America could become a “minority player” in alt-protein funding; as Asia Pacific, the Middle East, and Latin America — which matched Asia’s 11% share in 2021, driven mainly by multiple rounds involving plant-based brands NotCo and Fazenda Futuro — take a majority of investment dollars between them.

But this can happen only if investors “dramatically ramp up support for plant-based, fermentation, and cultivated meat manufacturing infrastructure, which is critical for nurturing sector growth,” the statement said.

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