4.3 Government intervention points Identifying the elements necessary for a robust alternative protein industry and recognizing market constraints both inform government support, enabling focused intervention to stimulate innovation and growth. Through the Israel Innovation Authority, the government is developing a comprehensive approach to investing in the business environment at various stages and with multiple stakeholders. A thorough examination of the value chain facilitates a nuanced understanding of unmet needs, the potential support mechanisms and critical leverage points at which government intervention can have maximum impact. Stages of research and development FIGURE 6 R&D Basic researchApplied researchInitial venturePilot stageInitial production Source: Shaldor Strategic Consulting Deepening the roots with basic research: The alternative protein industry, deeply grounded in agriculture, biology and medicine, requires advanced infrastructure and skilled personnel for it to progress, with government support in establishing research and development foundations29 imperative to develop the science. In 2022, GFI Israel together with the Israeli Ministry of Agriculture and the Ministry of Innovation, Science and Technology published an open call to fund research grants of $1.2 million total and up to $85,000 per project in alternative proteins. Of the 25 proposals submitted, the top 15 received a grant. In 2023, the call for proposals was published for the second time. Out of the 70 active researchers, 48 received funding from GFI. Cultivating applied research: Applied research focuses on the technological development of alternative protein sources, processes and product formulations. This stage establishes intellectual property and is the foundation for forming companies within the business environment. Investing $18 million over three years, the Israel Innovation Authority formed the Cultivated Meat Technological Consortium, comprising 14 companies and 10 academic laboratories, partnering to develop technologies for the cost- effective production of cultivated meat.30 Incubating innovation at the initial stages: The initial stage involves incubating start-ups through laboratory-scale research and development. The emphasis is on developing a product with commercial potential based on applied research, focusing on validating proof of concept. This phase varies widely among technology types and can span several years. The Israel Innovation Authority supports two large food-tech incubators: Strauss Group’s The Kitchen and Tnuva’s Fresh Start. These are responsible for establishing more than 25% of all alternative protein start-ups. The incubators offer Creating a Vibrant Food Innovation Ecosystem 16

Protein Diversification 2024