Smart funding for Protein Diversification: how Europe can finance its food future

Europe has already recognised the need to diversify its protein sources to build a more sustainable and resilient food system that can also improve farmers’ livelihoods. The environmental, economic and social case is clear, as explored in our earlier article, Why Protein Diversification Matters. 

The question is no longer why, but what to fund and how to make it happen. 

In recent years, Europe has invested billions in agricultural innovation, yet less than 1% of EU food R&I funding has gone toward alternative proteins.1 Public investment in plant-based or cultivated protein R&I is estimated to be 1,200 times lower than funding for meat-based foods, despite the potential those alternatives hold. They can lower GHG emissions, reduce Europe’s reliance on imported feedstocks and meet the growing consumer demand for sustainable choices.  

To achieve the EU’s competitiveness, strategic autonomy, and food security goals, protein diversification must become a strategic funding priority.  

The EIT Food Protein Diversification Think Tank (PDTT) undertook a multi-stage process to analyse the continent’s funding landscape and propose practical solutions on what should be funded and how the funding should work. Over recent months, the Think Tank conducted a comprehensive landscape analysis of global and European funding mechanisms, reviewed key industry reports, and hosted workshops with experts from philanthropy, public administration, and research, including the Next Bite 2025 panel, “From Vision to Action - Smart Funding for Protein Diversification”.  

Europe has the scientific excellence, entrepreneurial talent, and societal will to lead the global protein transition. What it lacks is a coordinated funding strategy that brings together public and private investment across every stage, from discovery, to development, and deployment. 

 To achieve the highest return on investment, the PDTT has identified four priority areas where targeted funding can deliver the greatest impact. These are: pre-competitive R&D, innovation infrastructure, scale-up and commercialisation, and education and skills.  

(1) Increasing public funding for pre-competitive R&D in plant-based, fermentation-derived, and cultivated meat technologies 

Advancing protein diversification starts with knowledge; Europe should increase public funding for pre-competitive R&D across plant-based, fermentation-derived, and cultivated protein technologies, particularly at Technology Readiness Levels (TRLs) 2-6, where early-stage innovation happens. This investment is crucial to meet fast-growing consumer demand for better-tasting alternatives that are affordable and largely available.  

This requires investing in pre-competitive R&D across seven areas. 

(2) Expanding and investing in food living labs, testbeds, and sandboxes with flexible regulatory frameworks and provisions for controlled experimentation and tastings 

To turn scientific breakthroughs into everyday meals, Europe must expand food living labs, testbeds, and sandboxes - spaces that bring together academia, startups, industry, and consumers. These environments provide controlled conditions for experimentation and engagement to help innovators test new products while building public trust.  

This approach is not new. Countries like Singapore and the UK, as well as EU pioneers such as the Netherlands, have shown how these facilities can foster innovation while maintaining high food safety standards.  

The European Commission has already acknowledged the potential of testbeds, regulatory sandboxes, and living labs through initiatives like the European Innovation Act. But recognition alone isn’t enough. A supportive regulatory framework is essential, and so is funding.  

By pairing adapted rules with financial support, the EU can translate science into market-ready solutions faster. 

(3) Bridging the funding gap for infrastructure in the ‘valley of death’, enabling the transition from research to commercialisation 

Even the most promising ideas can stall without access to pilot- and demonstration-scale infrastructure. To bridge this gap, Europe must fund projects and platforms that enable technologies to quickly move from proof-of-concept to market-ready, focusing on Technology Readiness Levels (TRLs) 5-8. Public investment is critical at this stage – this is often where private investment falls short. Support should cover infrastructure enabling pilot production, consumer acceptance testing, and institutional procurement.  

Public funding should help during this phase with non-dilutive financing options, such as loans, guarantees, and other public subsidies to de-risk private investments and support infrastructure build-out, incentivise the repurposing of underutilised facilities, retrofit existing plants, or build networks of shared processing facilities. 

Europe doesn’t need to start from scratch. Successful examples already exist, like Belgium’s Bio-Base Europe Pilot Plant or ENOUGH & Cargill, which show how targeted support can prevent ideas from falling into the “valley of death”. 

(4) Education and capacity-building for food systems transformation 

Europe’s food transformation will succeed only if people have the skills to deliver it. The EU must prioritise systemic, lifelong education and capacity-building programmes across all stages, from primary schooling to vocational and higher education.  

Curricula should integrate emerging technical, transversal, and systems thinking skills, bridging gaps between science, industry, and entrepreneurship.  

Supporting dynamic learning environments, such as innovation hubs, regional research centres, and EU-funded transdisciplinary projects like FEASTS, EPIC-SHIFT, or FoSSNet will enable Europe to attract and retain top talent, reduce skill mismatches, and boost its leadership in food system transformation. 

Knowing what to fund is only half the challenge. Europe also needs to rethink how funding works - the mechanisms, priorities, and partnerships that make investment effective. 

The PDTT identified six priority areas for improving the way Europe funds protein diversification. 

(1) Funding as fuel, not friction 

 Funding is not just about innovation - it’s about validation. It’s what turns promising research into viable products and ideas into market impact. Yet, too often, Europe’s innovators face a fragmented, bureaucratic system that slows them down. 

Applying for funds has become an industry. Entrepreneurs and scientists spend months wading through complicated processes, preparing applications that too often end in rejection. It's a valuable time that could be spent developing solutions. 

To make real progress, funding mechanisms must become more simple, agile, and accessible. Processes need to be designed to empower entrepreneurs and innovators and facilitate the transformation of their ideas into viable commercial products. Applying for funds from European projects should not require hiring a dedicated staff member just to make sure an application is not lost on a technicality or to manage to map out the myriads of disconnected funding streams, whether EU, national, regional or private. Grants should give innovators fuel, not friction. 

(2) Recognising protein diversification as a strategic EU priority 

The EU is a leading player in protein diversification, with a vibrant startup ecosystem and a market primed for growth. To stay ahead, the EU needs a long-term vision for how to diversify its protein supply to reap key societal and economic benefits. The much-awaited European Commission Protein Strategy offers the perfect opportunity to make this commitment. 

This Strategy should highlight the benefits of protein diversification for Europe’s economic competitiveness, resilience and its food and geopolitical security. By reducing import dependency and increasing side stream valorisation, it can boost farmers’ incomes and enhance economic self-reliance.  

Other countries, like the United States, are already investing heavily in bioindustrial manufacturing to shore up their food supply chain resilience - Europe cannot afford to lag behind. In Germany alone, for example, protein diversification could boost the economy by as much as €65 billion and create up to 250,000 jobs by 2045. 

(3) Enhancing value-chain cooperation through localised Innovation Hubs 

EU funding programmes should prioritise pre-competitive, multi-stakeholder collaboration through consortia-based projects, cascade funding, and regional innovation hubs.  

A localised approach can create a win-win ecosystem where innovation is both commercially viable and regionally beneficial. A strong example is the Illinois Fermentation and Agriculture Biomanufacturing Hub, where public funding fostered collaboration between universities, industry, and farmers. Framing these hubs as drivers of economic diversification – creating jobs, enhancing regional resilience, and integrating with existing industries (e.g. agriculture, biotech) and infrastructure – can increase public and political support while avoiding polarisation. 

Policymakers are already acknowledging the value of these approaches. In the recent Bioeconomy Strategy, the European Commission focuses on the importance of fostering industrial symbiosis valleys and bioeconomy hubs to promote this sector. Similar initiatives must be introduced to promote protein diversification in partnership with local actors. 

(4) Strengthening collaboration between business and university to drive industry-relevant innovation 

Europe’s innovative potential depends on stronger links between research and industry. Currently, only 1% of patent families list both a public and private entity as co-assignees, suggesting a challenge in public-private collaboration in the alternative protein field.

Collaboration often fails due to misaligned goals – academia focuses on publications, while businesses require commercial applications. Funding models should prioritise cross-departmental research tracks and support pre-competitive research initiatives like Novo Nordisk Foundation’s Plant2Food project and iGEM, where innovation happens with minimal IP concerns.  

 Investing in innovation hubs like CellFood Hub (Denmark) or CiPA (Catalonia), which act as facilitators between researchers, universities, and companies, will accelerate commercialisation. 

(5) Expanding financial innovation to de-risk investments 

To truly scale the protein transition, Europe must expand beyond traditional grant models. EU funding should incorporate financial innovations such as blended financial instruments or innovative public financing mechanisms*. This can take the form of public-private partnerships or market-shaping tools. Likewise, there is great potential in turning public procurement (including pre-commercial procurement**) into a key lever to pursue innovation, especially when paired with other financing mechanisms like tax credits or carbon credits. 

These instruments can help de-risk investments, overcome fragmentation in the sector and strengthen market signals. By integrating these financing mechanisms for the alternative proteins sector, the EU can help unlock private capital by reducing risks.  

(6) Streamlining EFSA’s approval process to make it faster, more reliable, and more predictable 

Efficient regulation is just as critical as financial support. Currently, the average timeline for EFSA’s approval process is 2.5 years.10 The result of these difficulties in obtaining approval is that many EU-based startups relocate to countries with speedier, more innovation-friendly systems, such as the US. Without action to tackle this issue, the EU risks losing its head start in alternative proteins over a brain drain of its entrepreneurial and innovative talent. 

Introducing structured regulatory sandboxes/testbeds/living labs, followed by presenting a predefined timetable for each stage of the EFSA process, could improve transparency and confidence among stakeholders.  

Europe has the expertise and market potential to lead in protein diversification, but this requires a coherent funding strategy that bridges research, infrastructure, and deployment. Targeted investment in R&D, innovation spaces, scale-up facilities, and skills development must be paired with simplified funding mechanisms and regulatory efficiency. The forthcoming European Protein Strategy and the design of the Next Framework Programme for R&I (FP10) offer critical opportunities to embed these priorities into EU policy. Aligning funding instruments with long-term objectives for competitiveness, resilience, innovation, and food security is key to making protein part of Europe’s growth plan.  

EIT Food Protein Diversification Think Tank welcomes contributions to accelerate smart funding for protein diversification. Please share your ideas and join the discussion by contacting us at PDThinkTank@eitfood.eu. 

1. Universiteit Leiden (2024). Over 80% of the European Union's Common Agricultural Policy supports emissions-intensive animal products
2. https://www.advisorpedia.com/esg/department-of-defense-invests-heavily-in-food-innovation-why/
3. Systemiq (2025), “A Taste of Tomorrow”
4. Good Food Institute Europe (2025), State of the European Alternative Protein Research Ecosystem 2015-2024
5. https://research-and-innovation.ec.europa.eu/strategy/support-policy-making/shaping-eu-research-and-innovation-policy/new-european-innovation-agenda/innovation-procurement/pre-commercial-procurement_en
6. https://www.proteinproductiontechnology.com/opinion-posts/setting-the-record-straight-on-the-eu-novel-food-approval-process
7. https://www.nutritioninsight.com/news/eu-authorization-process-limits-market-access-to-onego-bios-fermentation-based-egg-protein.html