Software has clearly eaten the world. Marc Andreessen’s seminal piece was proved out faster than many predicted. Fast forward nearly a decade, it’s becoming clear that now “Biology Is Eating the World.”
Nearly every industry will be upended and rewritten in the coming decade by this innovative and suddenly malleable science. Chemicals, healthcare, cosmetics, agriculture, physical materials, textiles, petroleum, food and beverage, etc. — all have seen amazing strides in innovation in the last five years alone. Daily, academic labs, the Global 2000, and startups are discovering and building thousands of new practical applications of biology, in what we at Refactor Capital now call the field of “applied biology.”
Bio, in fact, is becoming the new chemistry. It’s clearly the “science du jour,” replete with toolkits, languages, and systems, often coupled with the power of computer science. The ability to engineer life by a) inserting, deleting, and editing genes, b) manufacturing proteins, and c) designing all new enzymes (the critical catalysts for all cellular activity) have allowed us to create novel, sustainable, higher-performing, and (at scale) cost-competitive products. This is clearly why we’re seeing a Cambrian explosion in the world of bio today.
Aside from the healthcare and therapeutic applications of biology, we like to divide all other applications into 3 general categories: “Consumer Biology” and “Industrial Biology”. Consumer Biology is the category of products designed for and sold to consumers. Industrial Biology is for enterprise and industrial applications (think chemicals, plastics, food preservatives, flavors & fragrances = F&F, and other B2B products). To be successful, both types of apps will require more platforms to be developed such as Culture Biosciences, Aether, Zymergen, Ginkgo Bioworks, and the ABPDU to support R&D optimization, downstream processing, and scale-up to achieve cost parity and superiority.
In particular, the vast majority of Consumer Bio capital and talent are flowing into the Foods category: meat and dairy in particular. Some are using plant-based techniques to develop alternatives to those foods, others are using cellular agriculture techniques to grow muscle, fat, curd, and other components to create incredibly tasty “clean” products for a world proliferating with both hard-core and part-time vegans (I’m the latter).
Also, beverages like Soylent, Berkeley Brewing Science, Kin Euphorics, etc. have attracted significant founder, investor, and corporate attention as millennials demand sustainable, unique, and tasty alternatives to meal replacements and alcoholic beverages. A couple years ago, Soylent became my daily breakfast as I discovered that my morning metabolism rates are significantly lower than during the course of the day — my body’s way of saying I need fewer calories in the morning.
Textiles are another big Consumer Bio category with companies like Bolt Threads, Modern Meadow, and Checkerspot creating novel physical materials with their unique technologies. Biology is the driving force of these companies’ innovation, creating sustainable, higher quality, safer, and unique in a market desperate for novelty and superior experiences.
Capital intensity can be a real challenge for Consumer Biology companies, frankly for any applied biology company. R&D, lab-scale development, re-agents, bioreactors, research staff, production staff, and more can slow time to market and commercial viability as a startup.
But, that shouldn’t stop founders and investors from deploying their time and capital into this arena given the massive pull by consumers demanding higher-quality and sustainable products. Just like AWS and other cloud services allowed software companies to scale quickly without purchasing their own capital equipment, biology platforms are coming, enabling the renting of resources and expertise for a finite time. That way, founders of Consumer Biology companies can focus on what they know best: creating and selling the very best consumer products around brands that consumers can trust.
In a later post, we’ll discuss Industrial Biology at length, but we first wanted to introduce “Biology Is Eating the World” as a core thesis here at Refactor and why we’re so excited about Consumer Biology, in particular!