A new peer-reviewed study has examined what venture capitalists prioritize when investing in cellular agriculture startups.
The study was conducted by Fabian Baumann, Senior Strategy Associate at precision fermentation startup Formo, and Prof. Dr. Marc Mehlhorn of TH Köln. It is published in the journal Entrepreneurial Business and Economics Review.
The aim of the research was to discover what makes cellular agriculture startups stand out during the initial venture capital screening phase. By questioning 44 investors in the field, the authors uncovered three factors:
- Scalability — Startups must be able to grow quickly and affordably.
- Entrepreneurial spirit — Teams must show drive and resourcefulness.
- Product/tech value-add — The innovation must clearly solve a problem or create a step change.
“Interesting starting point for further research”
Unlike in most sectors, scalability and product value came before team criteria. For founders, attitude and vision were found to matter more than experience. These insights could inform how startups pitch, increasing their likelihood of success.
Based on the results, the research suggests that policymakers should build open-access R&D and enable infrastructure that lowers scaling risk.
Investments in cultivated meat and fermented products fell in 2023, making it even more important that startups seeking funding tailor their proposals as effectively as possible.
“This research is the first to explore cellular agriculture investors’ investment criteria when screening early-stage ventures in the cellular agriculture domain,” said the study. “Our findings differ from those previously identified for non-specific industries, but as this is one of the first studies on investment criteria in cellular agriculture, it provides an interesting starting point for future research.”
