The Form Playbook Interview: Hoxton Farms on how to build at the frontier of regulation
Every month we interview a leader in venture, start-ups and regulation for The Form Playbook, our newsletter supporting founders building in markets where policy matters.
This month we caught up with Ed Steele, co-founder of Hoxton Farms. Starting from just a few cells, Hoxton Farms combine cell biology and mathematical modelling to cultivate delicious, cruelty-free and sustainable animal fat. Building a company at this technological frontier also brings unique regulatory scrutiny and go-to-market challenges, so we sat down to discuss the most important actionable insights from this experience. We discussed:
- How the regulatory landscape has evolved since they founded the company
- How to retain the initiative as a founder when interest grows from regulators and governments
- What kinds of questions investors ask about regulatory risk — and what makes a good answer
Ed’s Advice for Founders:
- You want to be the ones shaping your market, not the regulators or government. Lead the conversation and take time to attend events and speak to everyone you can. Warm intros via investors can provide a significant advantage.
- Make sure you understand how policymakers and regulators are making decisions based on their own constraints and incentives. It’s often worthwhile to speak to as many people as you can within the same government department: don’t rely on their own internal communication! This matters to ensure you can make well-informed R&D decisions, understand where and how to go to market, and have strategic discussions with customers.
- Questions about regulatory risk are common to fundraising, and investors’ regulatory understanding varies. Despite the uncertainty, drawing on policymaking precedents about time-to-market and showing how you’re reducing your exposure to risk can help resolve these concerns.
FORM: As with many “frontier” technologies, regulation is a big factor for cultivated meat, both in terms of product and go-to-market — how have you thought about these as you’ve started and scaled the business?
ED STEELE: The regulatory landscape has evolved dramatically since we founded Hoxton Farms. When we first started the company, no cultivated products were approved for sale anywhere in the world. Now cultivated chicken is available in Singapore, tastings are permitted in The Netherlands and Israel and food agencies are working hard on regulation in many different markets. To ensure that we can make well-informed R&D decisions and have strategic discussions with customers, we have pushed for a seat around the table in consultations with regulators. These conversations have been essential for us in understanding where and how we will go to market, which products we will produce and what tools we can use in the lab.
When it comes to fundraising, how have you approached the question of regulation — and what kind of questions and views have you had from investors?
Investors’ regulatory understanding varies significantly. We’ve seen investors pull out of due diligence with concerns that cultivated meat won’t be approved, while others haven’t interrogated the topic at all. The most consistent questions centre on how long it will take for regulators to approve cultivated meat products and where the greatest risk lies. Although there is significant uncertainty, we can draw on regulatory and policymaking precedents from other novel ingredients to address investors’ concerns. Being involved in direct discussions with regulators allows us to provide investors with convincing arguments about how we can reduce our regulatory risk and go to market more quickly.
What does it take for founders to engage well with government and regulators? What do those who have not done this before need to know?
As with most networking, warm introductions are a significant advantage. The team at Form has been invaluable here. It’s often worthwhile to speak to as many people as you can within the same government department: don’t rely on their own internal communication! Penetrating the world of regulation and policy takes patience, a positive outlook and many, many conversations!
What tips would you give to founders thinking about taking on markets where regulation and public policy will shape their market?
1. Make sure you are leading the conversation. You want to be the ones shaping your market, not the regulators or government. Take time to attend events, cultivate relationships, and speak to everyone you can.
2. Understand the regulators’ point of view. Policymakers and regulators making decisions based on their own constraints and incentives — make sure you understand what these are and how they affect your product.
This interview was published on The Form Playbook, our newsletter supporting founders understand, navigate and build where regulation is a driver of success: