All-Time Alt-Protein Investment Growth Remains Strong as Market Expands

All-time investments in cultivated, fermentation-derived and plant-based proteins neared $3 billion, $4 billion and $8 billion, respectively, by the end of 2022, The Good Food Institute (GFI) has found in its signature “State of the Industry” reports. 

While alt-protein investments decelerated to $2.9 billion in 2022 alongside a 35% drop in overall global funding, GFI found that growth remains strong over the long term: $14.2 billion has been invested in alt-protein companies over the past decade, with investment almost doubling on average each year. 

According to GFI, alt proteins represent an opportunity to reduce risks and improve the efficiency of meat production while offering consumers a meat-eating experience. The organization is calling on governments around the world to invest $10 billion annually in R&D and commercialization to derive the full benefits of protein diversification.

“Alternative proteins are a scalable solution that, with proper levels of public and private support, can transform our global food system for the better,” said Caroline Bushnell, VP of corporate engagement at GFI, a Washington, D.C.-based 501(c)(3) nonprofit think tank and international network of organizations. “The growth opportunities for this nascent industry are significant. With further investment and continued innovation to improve the taste and affordability of products, the industry will accelerate and be poised to capture sizable market share.”

GFI observed that last year, a number of new companies and brands entered the plant-based marketplace, and companies formed new strategic partnerships and industry alliances. Last November, Upside Foods became the first company to receive the go-ahead from the U.S. Food and Drug Administration (FDA) for its product to be sold in the United States, following regulatory approval from the USDA. GOOD Meat followed suit in March 2023. 

Euromonitor data featured in the reports noted, among other alt-protein growth, that from 2017 to 2022, the global plant-based meat and seafood market increased 118% from $2.8 billion to $6.1 billion, and that 19 new cultivated-meat companies launched in 26 countries, for a total of 156 companies, a 14% increase from 2021. 

Further, the majority of the world’s biggest food companies now have some involvement in the alternative-protein sector through investment, acquisition, partnerships, or developing and manufacturing products themselves, demonstrating the conventional food industry’s confidence in the sector, according to GFI.

The organization also noted that hybrid products — combinations of cultivated meat and fat, plant-based and/or fermentation-derived ingredients — can offer new technologies a quicker path to market, as these types of products can boost access to new ingredients while improving the taste and sensory experience for consumers.

The past year additionally saw various governments begin or increase funding for alt-protein research and development, commercialization, and infrastructure, GFI found.

“Governments around the world are increasingly recognizing the urgent need to support the development of alternative proteins, and are providing unprecedented investment in R&D funding and infrastructure support,” said GFI VP of Policy Jessica Almy. “These investments not only advance technological progress, but also send a clear message that alternative proteins are a critical component of a sustainable food system. While more public investment is needed to meet global climate goals, 2022 showed us that leaders from the Netherlands to South Korea are paying attention and recognize the transformative potential of alternative proteins.” 

GFI’s reports also noted the opening, expansion and announcement of new facilities for companies around the world, indicating a shift toward more sustainable and innovative protein sources; new evidence that further supports the environmental and societal benefits of alternative proteins; and the ongoing growth of the university ecosystem focused on alternative proteins.

The reports were compiled through months of research, fact-checking and insights from such data sources as Pitchbook, SPINS, Circana (formerly NPD and IRI), Euromonitor, Mintel, consumer research studies, GFI analyses, GFI’s Company Database, news articles, and stakeholder input. Individual data points are cited directly within the reports. 

In other alt-protein news, the “The Plant Based Foods State of the Marketplace” report from the Plant Based Foods Association found that plant-based food dollar sales grew 6.6% in 2022 to $8 billion, with unit sales reflecting the 3% decline also seen in total food and beverage and animal-based foods.