‘Beyond stupid’: Investors slam lab-grown meat restrictions – and billions in livestock subsidies

Last week, Euractiv reported that EU lawmakers were exploring a legal way to block lab-grown meat companies from calling their products “meaty” labels such as “sausage” or “burger.”

If successful, the move would follow an EU proposal, approved in October, to ban such labels on plant-based products. The ban, first put forward by French conservative MEP Céline Imart in July, argues that consumers might be misled or confused by names that evoke meat when the product contains no animal components.

Felix Leonardt, managing partner at Oyster Bay Venture Capital, thinks the move to extend the ban from plant-based proteins to lab-grown ones would be “beyond stupid.”

“The EU should focus on stuff where it can actually protect and help its citizens, like defence or creating a deep capital market that can actually support innovation… and lots of other good things,” he tells Impact Loop in a text message.

However, Leonardt doesn’t think a ban would not significantly hinder the growth of the alt-protein sector.

“I think the whole naming debate actually matters a lot less than most people make it out to,” he says. “Alternative proteins will succeed or not succeed based on economics. Obviously marketing and storytelling are a part of it, but in effect people just want a cheap product that tastes really good. If alternative protein can deliver that, then people are going to buy it.”

Lab-grown backlash

The EU’s potential crackdown on meaty labels for lab-grown or “cultivated meat” would be the latest in a string of regulatory hurdles for the nascent industry.

Europe has been slow to pass laws governing cultivated protein, forcing some startups to scale in countries where laws are more lax, such as Singapore or the US. Sales of lab-grown meat remain illegal in the bloc, and even tastings are highly restricted. Italy and Hungary have banned the sale of cultivated meat entirely.

Harry Briggs, partner at Astanor Ventures, previously told Impact Loop that the long and "fragmented" approval processes for novel foods are holding cultivated meat and the broader foodtech sector back.

“European [food] regulations mostly slow innovation,” says Briggs, who’s spent decades in venture capital, including as partner at Balderton Capital and Omers Ventures, before joining Astanor last year.

Meanwhile, as cultivated meat struggles to gain traction in the EU, the continent continues to pour subsidies into livestock.

‘A legacy system’

Last week, a landmark report made headlines for one key finding: that beef and lamb receive 580 times more in EU subsidies than high-protein legumes such as beans, lentils, and peas.

Adrian Friederich, head of investment at FoodLabs, called the subsidies a symptom of the bloc’s “legacy system.”

“The current EU subsidy landscape is geared toward traditional livestock and is in need of an update,” Friederich tells Impact Loop via email. “Subsidies should be in line with scientific consensus and generate a level playing field…any deviation, as we’re seeing here, should be adjusted.”

To counter the effect of pro-meat subsidies, Friederich thinks that alt-protein sector should focus its efforts on providing quality products and good prices.

“We believe that long-term market leadership isn't won through subsidies alone, but through innovation that is scaled successfully to unlock superior products,” he says, adding that as early-stage investor Foodlabs remains focused on “technological advancement” and “shifting consumer demand” as the main levers of change.