A bio-revolution will be the next industrial revolution. Given that the results of the first industrial revolution caused the main pollution problems that we now face, it has to be. But, in addition to the solutions, we must feed and heal a growing population in an efficient and long-term manner.
The bio-revolution has already started. Medicine is one of the primary sectors where biotechnology is already dominant; the messenger RNA vaccination that millions of people have received to protect them from Covid-19 was science fantasy until a few years ago.
However, the bioeconomy of the future will be made up of more than only medicine. Manufacturing, agriculture, energy, chemicals, and materials will all be included. There are two forces at work here that are pushing for a revolution. The first and most obvious driver is environmental preservation, which pervades every aspect of our life, from the clothes we wear to the plastic bottles found on practically every beach. The second issue is that an expanding population requires a reliable and affordable food supply.
In all of these areas, the focus was on the entrepreneurs who are bringing inventions to life. They aren’t, however, working in a vacuum. Pharmaceuticals, manufacturing, chemicals, food, and energy companies are all investing billions in their own research and development, as well as cooperating with startups.
Biomanufacturing will be the bioeconomy’s counterpart of new manufacturing methods, which were the foundation of the initial industrial revolution. Biology has the ability to self-assemble, self-repair, and self-replicate, according to the hypothesis. Biology, fortunately, runs on ‘digital’ code in the form of DNA. This implies we can read and write it to programme cells similarly to how computers are programmed.
This is made possible by the convergence of a massive increase in computer power with developments in biotechnology, such as our ability to read, write, and modify genomes. It may appear easy at first, but the idea is valid, and the consequences for moving away from petrochemical dependence are huge.
Our material world is currently made up of about a half-dozen petroleum-based building components. Nature, on the other hand, supplies a considerably more abundant and intrinsically sustainable supply. As a result, a number of businesses have built technology platforms that combine molecular biology, data science, automation, and genomics to identify useful compounds that already exist in nature and use them to create goods. Microbes in a fermentation tank replace typical concrete and steel chemical factories in biomanufacturing.
Zymergen, a biotech company based in the United States, has produced a biofabricated material with the high transparency, temperature resistance, and mechanical qualities required by manufacturers of digital displays. The fashion industry, which is the world’s third-largest manufacturing sector and accounts for 10% of global carbon emissions, will be a major focus. Bolt Threads’ fungi-based replacement to leather, AMSilk’s spider silk shoes manufactured by bacterial fermentation, and AlgaLife’s algae-based textiles are among the companies working to change this.
Meanwhile, Deep Branch, a British-Dutch company, is using gas fermentation to turn CO2 into single-cell protein animal feed, and food industry behemoths Cargill and Tyson are investing in cultivated meat, which is grown from animal cells without the use of animals, by backing companies like Future Israeli firm Meat Technologies and US-based Memphis Meats.
Biotechnology is the future, and investors can no longer disregard the value this industry will create over the next few decades.
Biotech innovation is essentially research and development prior to a commercially viable venture. Driving massive market shifts, on the other hand, may necessitate business model innovation and a rethinking of the value chain in order to avoid shifting the bottleneck from one location to another.
Cell and gene therapy, for example, maybe delivered as a single, high-cost treatment rather than a lifetime supply of medications. This significant shift in delivery necessitates new pricing structures, which may need to be based on the outcome rather than the treatment cost. It’s possible that cultured meat will need to be priced differently. The vast development costs must be recouped in some way, thus de-risking this type of innovation must be considered from the start.
Limited partners with a high-risk tolerance are gradually stepping forward as specialists. My Octopus Ventures colleagues and I both have biochemistry backgrounds, so we can better appreciate the scientific problems entrepreneurs have in bridging the gap between R&D and building a minimal viable product. Patient capital isn’t a new notion, but it’s been pushed to new heights with biotechnology, where not just the time scale but also the risk profiles are intimidating.
Investors in the mainstream are beginning to pay more attention to their portfolio’s ethical and social impact, pushed by the market and reflecting a fundamental shift in investment culture. There’s still a long way to go, but a more focused collection of expertise is influencing decision-making at the highest levels.