The Weekly Circuit
👋 Good Wednesday morning in the Middle East!
Tel Aviv prides itself as a bastion of vegan cuisine, so it’s not so surprising that the city has spawned a sizable collection of food-tech startups producing plant-based substitutes for meat. As The Circuit finds this week, they’re not daunted by the troubles of industry leader Beyond Meat, which has lost more than 90% of its stock market value over the past three years. Besides companies that are developing non-meat alternatives to farm-grown livestock, we take a look at those pioneering so-called cultivated meat, which is lab-grown from the cells of animals and doesn’t involve their slaughter.
Now that Lebanon and Israel have accepted a U.S.-mediated agreement to resolve their conflict over drilling rights to offshore gas reserves in the Mediterranean, both countries are assessing the potential for profit. Israeli Prime Minister Yair Lapid said yesterday he expects pumping gas from the Karish field to “inject billions” into the economy when it’s exported to a fuel-starved Europe. Lebanon, on the other hand, won’t benefit for at least five or six years from the Qana field as French energy giant Total and Italy’s Eni search for underwater gas deposits.
Oil prices topped the agenda at a meeting in St. Petersburg yesterday between Russian President Vladimir Putin and Sheikh Mohammed bin Zayed Al Nahyan, the UAE president. The Russian leader called attention to Emirati support for last week’s decision by the OPEC+ group to cut oil production by 2 million barrels a day. Now the question arises whether the UAE will also feel the wrath of the Biden administration, which said the U.S. will “reevaluate” the already rocky U.S.-Saudi relationship in light of the oil cut it tried to head off.
Abu Dhabi was in hoops heaven last week as the NBA brought preseason play to the UAE capital. Not hard to spot was 7-foot-1 former superstar Shaquille O’Neal, who shot baskets on an outdoor court near the Etihad Arena, where the Atlanta Hawks swept the two-game series with the Milwaukee Bucks.
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The next issue of the The Weekly Circuit will appear Wednesday, Oct. 19, as the holiday season wraps up. The newsletter will return afterwards to its regular publishing schedule on Mondays.
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FUTURE OF FOOD
Eager Israeli food startups shrug off Beyond Meat’s market woes
When Beyond Meat Inc. went public in May 2019, investor excitement over the sizzle of its plant-based burgers sent the stock soaring, giving the California-based company a market value of almost $14 billion. Three years later, the shares have fallen more than 90%, fueling concern about whether consumer demand for meat alternatives will live up to the expectations they’ve generated, Linda Gradstein reports for The Circuit.
Cultivated meat: In Israel, home to a thriving vegan culinary culture and more than 400 food-tech startups, the prevailing outlook is optimistic. While several Israeli companies are producing plant-based versions of beef, chicken and fish – as well as eggs and dairy products – another frontier of so-called cultivated meat, which is made from lab-grown animal cells, is gaining traction. “Plant-based meat as it is today won’t get people to stop eating meat,” Guy Nevo Michrowski, CEO of Israel’s ProFuse Technology, told The Circuit. “The only thing that will get them to switch is something that really tastes like meat, and that is what is already happening.”
Raising funds: ProFuse raised $2.5 million last month in a funding round led by New York’s Green Circle. Investors included Tnuva, one of Israel’s top two food producers; beverage-maker Tempo; OurCrowd, a Jerusalem-based platform for crowdfunded venture capital investment; and Newport Beach, Calif.-based Finistere Ventures.
Changing calculus: ProFuse’s technology, which nurtures the cells in a nourishing liquid, was developed over six years of research at Israel’s Weizmann Institute of Science. The process can potentially enable the large-scale manufacture of meat in bioreactors at a cost similar to producing farm-grown beef, chicken and pork, Stu Strumwasser, managing director of Green Circle, said last month after the new investment was announced. ProFuse’s method “may substantially accelerate that process and thus fundamentally change the calculus for the commercialization of lab-grown meat,” he said.
Lab-grown steak: Another Israeli company working on cultivated meat is Aleph Farms, which gained fame for producing the world’s first lab-grown steak. With actor Leonardo DiCaprio among its investors, Aleph Farms raised $105 million last year to bring its steaks to market by 2023. The funding round was led by DisruptAD, the venture capital platform of the Abu Dhabi sovereign wealth fund ADQ, and the Growth Fund of Greenwich, Conn.-based L Catterton, the largest global consumer-focused private equity firm.
Gulf interest: The United Arab Emirates and Bahrain, which import the vast majority of their food, have been developing partnerships with Israeli food-tech companies since the 2020 Abraham Accords normalized relations between Israel and the two Gulf states. Aleph Farms and DisruptAD have discussed building a manufacturing facility in Abu Dhabi to produce cultivated meat products and sell them across the Gulf.
Read the full story here.
Flying Cars: The UAE’s annual Gitex exhibition, one of the world’s biggest tech conferences, opened in Dubai on Monday with flying cars, self-driving taxis and more than 100,000 people expected to attend.
Arms Sales: Israel’s defense companies have come out big winners from the Abraham Accords, according to the Wall Street Journal, signing major arms deals with the United Arab Emirates, Bahrain and Morocco.
Seizing Assets: The UAE seized $1.3 billion in assets over a one-year period in its fight against money laundering and financing of terrorism.
Metaverse Lessons: Dubai launched an academy to teach digital business skills and help startups operate in the metaverse.
Boycott Buster: As part of an effort to increase pressure on the Arab League over its boycott of Israel, the U.S. Department of Commerce plans to tighten penalties for and increase enforcement of preexisting anti-boycott laws.
Finnish Stake: Finland’s Nordic Capital invested $300 million in Israel’s Equashield Medical, acquiring a 25% stake that values the company at $1.3 billion.
Green Finance: Saudi Arabia’s Public Investment Fund raised $3 billion through a “green bond” to finance investments in renewable energy, as well as construction and transportation projects that adhere to environmental principles.
Health Provider: UAE hospital operator Burjeel Holdings raised $300 million in an IPO on the Abu Dhabi Securities Exchange.
London Lemonade: Israeli digital insurance company Lemonade, which trades on the New York Stock Exchange, started operations in the UK.
Top Startups: Companies focused on cybersecurity, robotics and funeral planning are among the year’s top Israeli startups, according to Wired.
On the Circuit
Shaquille O’Neal, the former NBA star center, said he’s looking to buy property in the UAE. O’Neal was in Abu Dhabi as an ambassador for the basketball league, which held a preseason tournament in the emirate. The Atlanta Hawks swept the Milwaukee Bucks in the two-game series.
Zvi Marom, CEO of Israel’s BATM Advanced Communications, said he will step down after 30 years of leading the company. CFO Moti Nagar will succeed him.
Keren Terner was named chief operating officer of Israel’s Vintage Investment Partners. Terner was previously director-general of the Israeli Finance Ministry.
Ahead on the Circuit
Oct. 18-20, Eilat, Israel: “Sea the Future.” First annual conference on sustainable aquaculture in Israel and food from arid climates. Herods Boutique Hotel.
Oct. 25-27, Riyadh, Saudi Arabia: Future Investment Initiative. Conference bringing together CEOs, policymakers, investors to discuss the future of international investment and the global economy. King Abdulaziz International Conference Center.
Nov. 17-18, Abu Dhabi, UAE: The Milken Institute Middle East and Africa Summit. Experts gather to ponder prospects for the region in the realms of business and geopolitics. Rosewood Hotel.
Dec. 6-8: Manama, Bahrain: Arab International Cybersecurity Summit. Cybersecurity experts, business and government leaders discuss risks and opportunities in the digital world. Exhibition World Bahrain.
Hakuna Matata: Disney’s “Lion King” musical added an extra five performances to its monthlong booking at Etihad Arena in Abu Dhabi, which starts Nov. 18. Ticket demand exceeded expectations for the show, whose touring cast will perform for the first time in the UAE.
No Worries: Israel’s annual Haifa Film Festival opened Saturday night with a showing of U.S. director Olivia Wilde’s “Don’t Worry Darling” and will close Oct. 17 with Israeli director Shemi Zarhin’s “Silent.” The festival includes films from Iran, Egypt and Tunisia, and will welcome a delegation of women filmmakers from Morocco.