The Dutch market for alternative proteins is on the brink of exponential growth, expected to exceed €10 billion (US$10.8 billion) by 2030, says Foodvalley and Invest-NL’s recent report. However, the sector faces scaling hurdles due to limited access to facilities, high operational costs, complex regulations and funding shortages.

The report, titled “Enhancing the Ecosystem for Alternative Protein Innovation: Strategies for Scaling Success,” recommends national collaboration, targeted infrastructure and innovative financing models to bolster the Netherlands’ food innovation efforts.

“By strategically investing in shared facilities and implementing supportive financial mechanisms, we can position the Netherlands as a world leader in the transition to sustainable protein production,” says Emmanuel Anom, lead Shared Facilities at Foodvalley NL.

Lab-to-market obstacles
The report points to some of the critical challenges alternative protein start-ups face moving from lab-scale to commercial production.

Current pilot and demonstration facilities do not meet the sector’s rising demand and limited access to shared facilities leads to delays in market introduction. High operational costs, including expenses for equipment, personnel and raw materials, also pose a significant financial burden for shared facilities.

Additionally, navigating regulations for new food products further complicates the process for start-ups and scale-ups.

The findings also highlight the “Valley of Death” — the critical funding gap between R&D and commercialization that hinders innovation and market access.

Harnessing full potential
Invest-NL and Foodvalley NL have made several recommendations that the country can follow to harness the full potential of the alternative protein sector in the region.

Firstly, developing a national strategy that creates innovation clusters and streamlines regulations to stimulate growth is crucial. Government policy should support this collaboration with structural funding and infrastructure.

Strategic investment in shared facilities also plays a key role in establishing regional hubs with advanced shared facilities. When supported by public-private partnerships, they can help companies grow faster.

Meanwhile, implementing “flexible access models” is expected to increase the affordability of these facilities for alt-protein start-ups and scale-up companies.

Expansion of financial support mechanisms with vouchers, subsidies and innovative financing models is also suggested, along with bridge financing programs to close the gap between the R&D phase and commercialization.

Seeking government participation
Governments must play a central role in driving the protein transition, highlights the report. Their support is essential for building shared facilities, often not commercially viable at the early stages, yet vital for scaling alternative protein start-ups.

“Government participation is logical as these facilities serve multiple stakeholders within the industry. The €60 million (US$65 million) growth fund grant is a positive start, but more comprehensive and structural funding is required,” states the report.

The alternative protein sector should work closely with governments to identify specific infrastructural needs, map out long-term funding strategies to implement these initiatives.

A coordinated national initiative integrating existing regional projects is essential for streamlining the protein transition. This is important for preventing a “fragmented approach” and allowing optimal allocation of resources.

“Close collaboration between government and industry will maximize the impact of investments and achieve the transformative potential of alternative proteins.”

Examining successful models
Learning from international best practices from successful US, Israel, Belgium, Germany and Singapore models is also a suggested route to advance the Dutch alt-protein ecosystem.

The US uses an economic development model involving a triangular partnership between government funding, research universities and private companies as a fundamental strategy to drive innovation, technological advancement and economic growth.

Israel’s model is similar to the US with the added perspective of national food security, while Singapore’s relies on a heavily-planned government-led approach for applied research, economic development and private industry. It is a top-down and long-term strategic plan.

“These models emphasize flexibility, cost-consciousness, strong leadership, robust networks and government support as key drivers of success,” details the report.