By Paul Cuatrecasas on Monday 28 March 2022
Shiok Meats co-founder and CEO Sandhya Sriram gives Future Food Finance the lowdown on Shiok Meats, its future plans and addresses recent criticism of cultured meat.
Shiok Meats, the world’s first cultured crustacean meat company, is looking to disrupt the seafood market by bringing its cultured shrimp and lobster products to market at scale.
To date, it has raised $30m and in this interview with Future Food Finance, co-founder and CEO Sandhya Sriram talks about the company’s beginnings (and what piqued Sriram’s interest in cultured meat); its plans ahead; its acquisition of Gaia Foods; and she also addresses some of the criticism that cultured meat has recently faced.
Paul Cuatrecasas: What inspired you and your co-founder in 2018 to start the company? What was that nugget of inspiration, the spark that really got you going to do it?
Sandhya Sriram: So basically I'm a stem cell scientist by training, education, and have always been sort of plugged into biotech stem cells for the longest that I've known, right from my undergrad, master's, PhD, and so on.
But in 2014, as I was working as a stem cell biologist in Singapore, I started up my first company, which was a science news website called Biotech in Asia.
And why I bring this up is, as part of that was the first [cultivated] hamburger that was made by doctor Mark Post the same year.
And I came across it and sort of got obsessed with the technology, given the fact that I'm a stem cell scientist, and I've always worried about the environment and the planet and factory farming, hence, I'm a vegetarian by choice.
So I sort of got super excited about it. And as running this new startup, I decided to interview Mark. At that point, Memphis Meats and Finless Foods had just come up. So obsessively started, you know, following these people, interviewing them sort of reading about the industry, what went into it.
And I think in 2016 I said ‘OK, I want to get into the business of cultivated meat. I don't know if I should do it on my own, should I work in a company that does it and stuff like that’.
So I was sort of figuring out my footing, and I quit being a scientist and took a business development in biotech.
I wanted to learn the business side of science. So I learned everything from finance, HR, policy, IP, budgeting and all of that, and in 2018 that was my time to sort of make that final decision.
And I said ‘OK, I'm going put my foot down and start this cultivated seafood and meats company that I've always been wanting to build. Maybe it's the right time, it's been four years of this industry being there. I think at that point, there were about 30 companies doing it.
But none in Singapore, none in Southeast Asia. And I said ‘that's a bit surprising, maybe I should be the first one’. And that's how we started Shiok Meats.
â€¨PC: So that is very interesting because you had studied the entire industry in terms of meat and seafood, as you said, starting out with Mark Post, but when you started Shiok Meats with seafood, was it just seafood? Or did you have a particular species in mind? What was your thinking from day one?
SS: Definitely narrowed down on crustaceans and shrimp to start off with, and how we narrowed that down was literally looking at what was already out there. And we saw cultivated meat companies at that point between red meat and white meat predominantly, and BlueNalu had just come up.
So they were doing fish finless. And that's all on the seafood side. So we said what's unique in seafood that specific to Asia?
And we always wanted to cater to the Asian market where 60 per cent of the world's population lives. And just a simple Google search showed that crustaceans are the most produced and most consumed in this part of the world. And among crustaceans is shrimp. And it's a $150 billion market.
And personally, I think I've always been intrigued by crustaceans, I don't know why I think they just look beautiful. I guess it's because of that, but also started looking at the bad practices that were happening in that industry, the concerns of us consuming so much that the demand, you know, the supply-demand gap was there.
And it's highly produced in a very high protein product. And so that really intrigued us. This was on the market product side, right.
But coming to the actual scientific aspect of things, it was a bit scary because nobody else was doing crustaceans. There was no crustacean stem cell line that we could just buy and start doing work with.
There were hardly any academic papers on stem cells from crustaceans. So we were starting basic research, we were probably seven or eight years away from the market, you know, and we were like, sort of gearing up for that.
But I think with the skill that Ka Yi (Shiok co-founder) and I have, we were quickly able to isolate some of the stem cells and get to a point where we had a proof of concept and a dish prepared in about seven months of starting the company.
So that gave us confidence on the crustacean side of things. And we said ‘now we can definitely move ahead with crustaceans’.
And by then we were the first company in the world to do crustaceans. It's an interesting market, investors are interested in it so why not, you know, move ahead in that direction?
PC: And I know that in August, you launched or announced the world's first cultivated crabmeat. How did you get away with being able to announce that you were doing tastings without being regulated?
SS: So in Singapore, we are allowed to do that. We do inform the Singapore food agency or the regulators if you have any tastings, as long as it's not for commercial use.
And it is clearly mentioned that it's a prototype tasting or a showcase. They are okay with it. Also, we handpick the people that are tasting it, it's not given to the general public, it's not served at any random restaurant just like that to anybody.
It's an actual closed-door event and properly done. The tasters per se, are most probably either our investors, potential investors, partners or, you know, collaborators that we're working with. So, in Singapore, it hasn't been a problem to date.
PC: You know, Singapore clearly is the jurisdiction that is most likely to be first, especially given your locale. What can you talk at all about the view on timing, how long it might be before you can get approval?
SS: So 2018 August, when we started to, there was no talk about cultivated seafood or meats in Singapore or Southeast Asia literally.
And I still remember when I was pitching to the Western investors, like from the US or Europe, they were like, why Singapore?
Why aren't you moving to Silicon Valley or New York? And I sort of stood my ground on it. And I said ‘I want to be in Asia. I want to sort of be a pioneer and bring up this whole ecosystem’. And then seven months, the day we launched, we showcased our first shrimp dumpling.
I think the day after, the Singapore government announced the 30by30 mandate; and I was like ‘wow, this is perfect timing’. You know, we had no clue Singapore is going to do that. We had no clue they were looking at food tech.
We had I mean, the only thing that I knew of Singapore doing something in food tech was, you know, sort of bringing up urban farming or vertical farming. They were a couple of farms and Temasek the sovereign wealth fund is invested in just and in Memphis Meats. That's all we knew about. But I think they put the mandate very well together, it was timely because honestly, we import 90 percent of our food.
And it's scary for me as a Singapore resident when I think about that. And when I go into a supermarket, and I know my milk is from Australia, my eggs are from Brazil and my vegetables are from China and sort of scares me a little bit. I'm like, okay, we are dependent too much on other countries for things.
And I think Covid strengthened that scare a little bit with the fact that they were huge logistic issues. And I always think regionally and locally. I think it is the right time, the right place that has propelled us to the point where we want to be in terms of infrastructure, funding, support, ecosystem building. Singapore is doing an amazing job.
And we're very happy to be in Singapore. After that announcement, investors were like; now we know why you're in Singapore. And they never questioned why we were here after that.
PC: So to be clear on the current status of the company, it looks like the company has raised $30m?
SS: We raised $30 million; we are 34 employees. And we have just scaled up to a mid-scale production in terms of the technology side of things. We're moving on from the lab scale to the mid-scale. But it's still an R&D facility, the mid-scale. We are trying to prove that it's beyond the benchtop bioreactors.
PC: I understand you're looking at a Series B for Q1 this year. And is that mainly supporting the move to midscale and beyond in terms of bioreactors?
SS: No, we have enough funding to get to the pilot plants, which is beyond the midscale plant. This is the commercial pilot plant that will be able to produce a couple of 100 kilograms a month, which will be ready by quarter 1, 2023. And by then, we should be able to get our regulatory approval in Singapore.
The money that we currently have takes us to that for the money that we're raising next year. Series B is more for expansion of manufacturing growth.
And you might have seen that recently, we acquired a cultivated red meat company called Gaia Foods, it's of course, to fund them as well, and expand our product portfolio at some point.
PC: What's the reasoning behind the acquisition of Gaia Foods?
SS: It comes from a personal aspect as well. I have, over the years, become a mentor advisor to a lot of food tech startups, biotech startups, and it comes from a good intention of trying to help founders find the right footing.
And I think we are always looking at companies that are extremely strong on the technology side of things. But companies founded by two scientists don't always flourish on the business side.
It's sort of like stepping in and trying to help them with something that I have learned over time, and something that we have been extremely good at, which is business development, fundraising, the business, you know, marketing and branding side of things.
And we always have wanted to diversify our product portfolio. But we didn't want to do it from scratch. We didn't want to start a beef company. We didn't want to start a beef department or a pork department. At some point, this industry is becoming too is going to become too large, and consolidation needs to happen.
It was an excellent strategic time for us to do that to expand our core product portfolio. Also, Gaia Foods works on structured protein; it’s not minced on the technical side of things. We are very excited about using their technology to make structured shrimp crab lobster as well.
PC: The Counter article references Hubbard’s research and doesn't reference too much seafood. There's a bit there I think about Wild Type. What is your take on that, at least on some things such as the size of the bioreactors required to produce at scale to get the cost cheap enough?
SS: I agree with the article to an extent where it questions whether this industry is scalable, and this question is constantly on our minds, right? And I'm being very practical here. I've always been practical. I've never promised that we will take 25 percent of the conventional shrimp industry in the next ten years; I know that's not happening.
I'm being very practical about this; this industry will make it, we will reach scale. But it will take a while; it’s not happening in the next five years, it's not happening in seven years, it's probably happening in the long term, it's not the near term, it's not midterm, it's longer.
I genuinely believe we can reach it, but it will take a while. And I think the valid question of how expensive the infrastructure and the Capex is and will we ever reach, you know, breakeven profitability and the price point? It is a very, very good question, and it's on my mind all the time. I hope we start getting cheaper infrastructure for this industry.
And that will happen by the sheer volume that we buy from these companies, the bioreactor companies, the media companies; it will not go down at the scale that we are at right now.
The economies of scale can only come in when companies like us reach the 100,000-liter scale; it will be multiple 10,000-liter bioreactors.
But if I'm placing an order to a bioreactor operator, and I'm saying, the manufacturer, ‘sorry,’ and I'm saying ‘I need 10 x 10,000-liter bioreactors’, that's when he gives me a special pricing, right? If I'm buying one from him, he's not going to give me a discount on it, maybe like a five per cent discount.
So it's going to be economies of scale, it's going to be where 10 of us go to this one provider, a couple of providers and tell them we need all of this equipment for our mass scale, then you will see the prices going down, then you will see economies of scale.
That's when you talk start talking about price parity. I have another point to add since we are going to be mass-produced. Let’s say in 10 years, are we aiming for $1 a chicken per pound. Or should we be aiming at maybe $5 per pound, because in 10 years, chicken is not going to be $1; it is going to be more expensive.
So should we be aiming for something that's priced today at an inexpensive price? Or should we be aiming for something that would be in 10 years?
And that makes more sense for us to aim at because we are never probably never reaching the dollar one per kilogram? You know, with inflation with? Yeah, wherever we are.
PC: What about the article’s argument about cleanliness and that cold these cultures have no immune system?
And the facilities have to be pharma-grade because you can't let any bacteria or viruses in. Would that apply in the same way to seafood to the shrimp and crab that you're making as meats, or is there a different dynamic?
SS: Right, we use almost zero per cent antibiotics at this point at the laboratory scale, yes, very, very low percentage, but eventually, we want to get rid of it.
But that doesn't mean we'll never use antibiotics because there is a chance of large-scale contamination in any food production facility, a lot more with cultured meat because of what we are doing.
But that means we start looking at natural antibiotics. And in our case, we are looking at extracts from algae and seaweed and fungi and whatever is edible and food grade and natural for that process.
It is coming to the final product and whether it can be contaminated. Of course, it can be. Any fish you leave outside will make you sick if it’s not managed well in the frozen seafood logistics supply chain.
And we have to be even more careful because we are working with an extremely clean atmosphere and taking it into an atmosphere that may not be as clean when it goes into the logistics supply chain side of things.
The other question that I always have and my team is looking into is, when you take meat from an animal, it comes with the microbiota with your microbiome of the animal, which is the micronutrients per se, we make it in such a pure, clean manner that we don't have that in our meats.
So, one of the debates going on within the industry is whether we could add these externally, whether we could add these microbiomes, sort of microbes externally, that helped get the taste maybe sometimes the texture that you need the smell most of the scent comes from the microbe you know the good bacteria on the beat itself or the seafood, and also the micronutrients.
So we have been questioning this quite a bit. And I would say we are looking at the food-tech nutrition side of things.
PC: And what about the supply of amino acids that are required, both the cost of them and the actual volume required? Do you see that as a challenge? Are you looking to produce as much as it is for me?
SS: Oh, definitely yes. So now we are asking for a kilogram from a company at some point; I’m going to ask them hundreds of kilograms, hundreds of 1000s of kilograms.
And if this company is not able to supply that to me, it will be an issue for me because I can't make the meats without it.
Some of the ways we have tried to mitigate this are to work with companies that we know can supply to us, like more prominent companies with a track record of great supply chains.
And the other thing that we are doing within Shiok Meats is trying to make different combinations of the cell culture media and maybe use one for the first five years.
But let's say there's an issue with one of the ingredients in terms of supply, then we go on to plan B, the second cell culture media that we've proven to work.
And we can use that, and it's a diversified supply ingredient. So that way, you mitigate your risk. Maybe the second media will not yield you the same amount of meat, but you know what, you need to make meat, at least the production is not entirely stopped, and you're able to meet the demand.
PC: Because of the acquisition of Gaia Foods, you have an interest now in structured meat. And I don't know of any other cultivated company, there may be one out there, some other culture protein company, but I don't have any of the other ones doing that. And you see that as diversification, not as a distraction?Are you learning from each? Does learning from one to help the other and vice versa? Have you are you finding that already, or not yet?
SS: For us, it's diversification, not distraction, because we have decided to keep the companies operationally independent.
The team, they've met each other, but they don't work with each other on a day to day basis; I am not fully managing their company, they have a business director, that person manages the company, they have a CTO who is the ex co-founder, they are managing their own company, where we come in as a step in and tell them the learnings that we have got from fundraising or business development, or even small things like branding, how your website should look like and what your social media should look like, and stuff like that.
We discuss more on the business side of things, not so much on the R&D. But the R&D, what we are trying to do with them is we have made partnerships with other companies in the past, as you've seen, even in agriculture, for example, on the media side of things, it makes sense for in agriculture to work with Gaia Foods as well.
And I'm looking at how we can get those partnerships up and running fast without the back-and-forth calls and wasting six months on a legal document, which we've already signed with certain companies; we can use the same template and quickly get them up to speed.
Same thing with vendor contracts with equipment that we buy. It's easy, now we know what equipment is required, go to the vendor, tell them ‘give me the same price. Here it is. I need it. And I'm done’.
So what maybe we spent six months earlier to set up our lab space with guys getting done in three months. It's accelerating the path to market on the technical side. As I said, we are so excited that this team has this expert ability to develop a scaffold for seafood or the structured protein for seafood.
And that's where we're interested in, sort of, collaborating on the technical side.
PC: If you've got the expert team and the capability and division and they the creative imagination to adapt to even a different species, is it possible over the next, let's call it the midterm, right over the next five years, that you could also consider moving into a fishery, not necessarily compete directly with a blue nose, tuna, bluefin tuna, or I think Wild Type is going after salmon but some other species? Is that possible? Is it something you can do if it doesn’t distract it?
SS: I never say never. But again, we don't want to do it all on our own. It's, it's better to work with other partners that have done it to a certain extent.
PC: Is there anything that you haven't shared with me? Is there something I've missed that you'd like to mention and talk about?
SS: Because we were talking about midterm and long-term, I think the long-term vision of Shiok Meats is that we, as a consumer, walk into a supermarket, and we're able to see an entire frozen aisle of conventional seafood and a smaller shelf of plant- based and cultivated seafood. I don't think it's fading away completely; it will be there.
But I think that's our ultimate vision as a consumer. You walk into a supermarket, and you have the choice to make between different brands, products, and proteins, whether it is plant- based, cultivated, or conventional. And I hope we as consumers make the right decision. Though I've not been asked, I think it would be impractical to tell you that you have to eat cultivated seafood and meats three times a day every day, right?
So I want consumers to have the diversity and choice to make that informed decision. And I hope that we as a company can give that transparent, you know, access to them as to how we make this product so they can make that informed decision.
And I think that's the ultimate vision for Shiok Meats. Be it red meat, white meat or fish, or whatever it is for the future. And on my plate, I'd like to see an entire array of products from plant- based and cultivated, blended, served together or separately, without harming the planet and having a sustainable food source. And that's what we're after.
PC: Such things like the meats themselves, the bioreactors, the ability to create amino acids or an alternative are all potentially going to advance so exponentially fast that we don't know yet that in two or three or four years, not only will the cost be different, but it may be an entirely different type of, of equipment.
3D printing, for example, is now being used in medicine in ways that weren’t even, you know, imagine five years ago. So I would presume you agree with that?
SS: Agree with that. I think we will become the manufacturing companies, making meats specifically for the alternativ protein industry, not for biopharma. It's happening. It will come up; it’s just a matter of time that it'll come up. Yeah.
PC: And I think it's exciting now that Clara, the Every Company, has announced publicly that ABN Bev BioBrew is producing these gigantic, world's largest ever vats for every protein product.
I mean, that's, that's how these things start, right? You get one company that can do it. Now they don't have the same regulatory requirements that you can do now, and others have. So they can be a little bit faster with these things.
SS: Yeah, and I also honestly believe if the industry is questioning whether this industry will be thriving, that means we have made it we have created, we started the revolution we are being noticed, and honestly be scared if these questions aren't being asked, and they are coming up. I'm glad people are thinking of it. And I'm glad we have some answers for it because we are out of it.