Unlocking investment in future food – an IP-led approach

A lot can be said about the fundraising environment at any given time, but for startups it is often tough. Although beginning to recover, the landscape is still far from
the high-water mark of 2022, where US$922 million was invested in alternative proteins in the USA alone. Investors are likely to remain cautious on alt protein in the interim, especially in light of recent high-profile closures at SciFi Foods and Meati, and startups seeking to attract investment will need to focus on the fundamentals.

For early-stage companies without proven technologies, this means IP. According to a report produced by the European Patent Office and EU IPO, startups that file
patents are six times more likely to attract VC funding than those without. However, in a competitive investment environment, it is rarely enough to simply develop an IP portfolio. To stand out, it needs to be embedded in the commercial package, and vice versa.

For IP, as in other areas, this is best achieved with a three-step approach: build a strong strategy, implement it, and communicate it.

When building an IP strategy, it pays to think commercially. Too often, strategies are developed in a vacuum without really considering how the pursuit of IP rights fits into a company’s overall goals.

Rather, any serious attempt to strengthen IP has to start with an understanding of the business and its goals, so it can be tailored toward achieving them. In particular, the raise timelines are vital factors as these provide deadlines for securing filings or concluding heads of terms. To be commercial, strategy needs to not only protect your ideas but consider third-party IP. Understanding who your IP threats are (those with patents that cover your products and processes) and how these overlap with commercial threats (who compete for the same market) helps de-risk the investment in a holistic sense.

Having a robust portfolio backed up by a holistic strategy is a key indicator of an investment’s quality – and getting this across to investors – is key

Another common mistake is failing to understand the investor perspective. Investors see IP as a double-edged sword: while essential to protect and de-risk investments, the costs to file and maintain can quickly become a liability. In the same way a bloated payroll may scupper a deal, IP budgets need to be justified by value add.

That is not to say a smaller portfolio is always better, but companies that with a focused strategy that maximizes the value of the IP budget are more likely to secure investment. Put simply, if you can’t show that the IP you have adds value, you need to revise the justification or trim the deadweight.

Once a strategy is developed, it needs to be implemented. Seeking advice – and acting on it – not only strengthens your position, but shows that you are taking the necessary steps to make the business thrive.

Finally, communicate the strategy. Having a robust portfolio backed up by a holistic strategy is a key indicator of an investment’s quality – and getting this across to investors – is key. This requires you to know your audience. Investors’ time is at a premium, and they require to-the-point communication. This is a challenge for IP, where both the law and technology can be complex, and where investors – even those managing portfolios focused on alternative proteins – are unlikely to have as deep an understanding as your science team. Seeking advice from friendly investors (for example, from your angel round), or contacts in your network experienced working with them, can be effective in honing the language to its distilled essentials.

There remains a lot of opportunity for fundraising in alternative protein. The challenge for startups is no longer that few investments are being made, as optimism returns to the market. Instead, companies need to show that they are worthy of investment, and the case needs to be clear in everything they do from accounts to IP. With new frameworks set to unlock a flow of investment into science and technology companies across the UK and Europe, the time seems ripe for a new wave of funded startups bringing new alt protein products to market.

Andrew Tindall is a Patent Director and patent attorney at HGF, based in London. He has a special interest in the technologies shaping the futures of food science, having spent his career working with alternative protein clients ranging from startups to investors and multinationals. This article is republished from the Q2 2025 edition of Protein Production Technology International, the industry's leading resource for alternative proteins. To subscribe to all future editions, please click here