Upside Foods Cuts Staff Amid Funding, Legal Pressures

Upside Foods has laid off 26 employees and is restructuring its management team as the cultivated meat company faces regulatory and other challenges, according to reports.

The Berkeley, California-based company is facing challenges from a slowdown in venture capital funding and increased legislative and regulatory pressures, the company’s founder and CEO, Uma Valeti, told employees, according to a Wired magazine report.

“Upside is focused on our next chapter of scale and commercialization,” an Upside spokesperson told SFA News Daily. “To stay agile in the face of an uncertain macroenvironment, we made adjustments to certain programs and reduced some positions. We’re deeply grateful for the hard work and commitment of our departing team members and remain focused on bringing cultivated meat at scale to the world.”

The company, formerly known as Memphis Meats, has been at the forefront of the lab-grown meat industry, attracting investments from such high-profile individuals as Richard Branson, Bill Gates, and Kimbal Musk, as well as from venture capital firms and, notably, traditional meat companies including Cargill and Tyson Foods.

Last year the company became the first to sell cultivated meat to consumers in the U.S. when its cultivated chicken, which is grown in a lab using animal cells, launched at the Michelin-starred restaurant Bar Crenn in San Francisco.

The restaurant debut of Upside’s cultivated chicken followed the announcement that the USDA and FDA had approved the sale of the product in the U.S. Both Upside Foods and Good Meat, a division of Eat Just, were granted approval for the sale of specific cultivated meat products.

Earlier this year, Wired reported that Upside had put its plans to build a 187,000-square-foot cultivated meat facility in Glenview, Illinois, on hold, and focus on investing in its existing facility in Emeryville, California. The Illinois facility would have had the capacity to produce more than 30 million pounds of cultivated meat per year, Wired reported.

Although cultivated meat startups such as Upside attracted significant investment in 2021 and 2022, funding dropped sharply in 2023, according to an AgFunder report. Investments fell by 78 percent in 2023, to $177 million, down from $807 million in 2022, which included a $400 round of funding by Upside Foods. 

In addition to the funding challenges, cultivated meat producers, who bill their products as being more humane and environmentally friendly than traditionally raised animal meats, have faced pushback at the state level. In March, both Florida and Alabama banned the sale of cultivated meat and seafood. In addition, Iowa banned the use of cultivated meats in schools, and several federal lawmakers have looked into imposing a national ban.

A total of seven states have introduced legislation banning the sale of lab-grown meats, according to a Time magazine report. The report also noted that Italy banned the sale of lab-grown meat last year, and French legislators have introduced a bill to ban lab-grown meat in that country.

Those who oppose the sale of cultivated meat cite concerns about its safety, and also express concern for the livelihoods of farmers and ranchers.

Meanwhile, cultivated meat remains extremely expensive to produce. The products are grown using real animal cells that are put into a bioreactor and nourished with water, sugar, fats, and vitamins. They can also be combined with plant proteins, and formed into nuggets, cutlets, and even steaks.