In 2013, academics made global headlines by unveiling the first burger made without animals. It wasn't plant-based; it was real meat. The only major difference was that the animal cells that became the burger didn't come from a living animal, but rather from an artificial reactor. Well, price was a big difference, too: That world-first burger cost an estimated $325,000. Hope you packed a lunch.

Animal-free biotech has made tremendous progress in the years since. There are now numerous start-ups developing animal-free beef, pork, and seafood, as well as gelatin, egg whites, and even materials such as leather. They've raised venture capital from the likes of Bill Gates, Cargill, and Tyson Foods (NYSE:TSN). If successfully commercialized, clean meat could make factory farms a thing of the past, save billions of gallons of water per year, and slash carbon emissions from food production.

While it's still in the early stages, the technology is worth putting on your radar. Here's what investors need to know about clean meat.

A man holding up a juicy burger

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1. The potential benefits are incredible

Factory farming is problematic in many ways, but it exists for a reason. Intensive animal farming sprang into existence after World War II as a way to ensure food security. That may be a remote concern for most Westerners today, but it's important to remember that an estimated 20 million people died of starvation during the war. That's roughly equal to the number of combat deaths.

That said, food security has come at a cost. Factory farming is associated with large amounts of greenhouse gas emissions, energy consumption, land use, and water consumption. Methane produced by livestock accounts for nearly a third of the greenhouse gas emissions from the agricultural industry, which in turn accounts for 9% of total greenhouse gas emissions in the United States, according to the Environmental Protection Agency.

Clean meat could potentially provide the best of both worlds: food security and reduced impact on the environment. There's no consensus on exactly how, and how much, this yet-to-be-commercialized tech could benefit society -- but nearly every study agrees that the benefits would be extraordinary. One widely cited study estimates that clean meat production could reduce the industry's greenhouse gas emissions by 96%, energy consumption by 45%, land use by 99%, and water consumption by 96%.

A woman reviewing a plan drawn on a massive chalkboard, surrounding a giant lightbulb

Image source: Getty Images.

2. The market opportunity is enormous

The incredible potential benefits of clean meat are certainly a big reason that companies like Tyson Foods and Cargill are interested in the fledgling technology. The sheer size of the market opportunity is a pretty big factor as well. Meat and poultry sales in the U.S. total over $200 billion, and the global market opportunity exceeds $1 trillion. Capturing just 1% of the market would create a $10 billion opportunity.

Tyson Foods is the largest meat-producer in the U.S., accounting for 23% of beef, 17% of pork, and 21% of chicken production. It generated 51% of its fiscal 2017 sales, or $19.5 billion, from consumer products. That's an important consideration, as the first clean meat products will be geared toward higher-margin consumer applications.

Tyson also created an in-house venture capital fund to invest in alternative meat products, and it made its first publicly acknowledged investment in clean meat just weeks ago. Tyson Foods further announced a stake in the start-up Memphis Meats, joining Bill Gates and Tyson's largest competitor, Cargill, to help the young company scale its first beef, chicken, and duck products.

Tyson Foods president and CEO Tom Hayes is a big believer in the technology (he started the VC fund months after joining the company). Meanwhile, Cargill CEO David MacLennan called clean meat "the future" of the industry. While the first clean meat products will be very expensive compared to traditional meat products, these market leaders think the economics could overwhelmingly favor the new technology one day. They might be right.

I recently spoke with Paul Shapiro to follow up on the launch of his new book, Clean Meat: How growing meat without animals will revolutionize dinner and the world. (The publishers created one version of the book bound with animal-free real leather and auctioned it off for $12,790 -- plus shipping.) The technology space is bigger and more mature than most people realize.

While Memphis Meats is an early leader in the industry, there are over a dozen clean meat start-ups today, all across the world. The ancillary technologies needed to commercialize the technology are progressing at a swift pace. Production costs are falling dramatically: Memphis Meats could be approaching $2,400 per pound -- much better than $325,000 for the first burger in 2013. The future might arrive sooner than most people think.

A road continuing on to the horizon

Image source: Getty Images.

3. It's still (many) years away

While clean meat's potential is truly amazing, it's important to be realistic about the commercialization timeline. It's been fun to see headlines about animal-free meatballs and burgers, but these amount to nothing more than "symbolic commercialization," to borrow a phrase from Paul Shapiro. I think the first mass-produced and mass-marketed clean meat product is still years away at best, and it will be a premium (read: expensive) product when it does arrive.

That's not a knock on the technology, but rather a nod to the difficulties of scaling up novel biotechnologies. Like it or not, the signal-to-noise ratio regarding clean meat (and many other next-gen biotech products) is extremely low. Despite all the hype, the field of synthetic biology has yet to commercialize a single high-impact industrial process that competes on economic terms with market incumbents. While a consumer food product has an easier path to commercialization than, say, a commodity chemical (because it will have higher margins), successfully scaling a novel process capable of cost-effectively producing a clean meat product will likely prove an enormous challenge.

Investor takeaway

We're nowhere near seeing clean meat in supermarkets, but the fact that Tyson Foods and Cargill -- the top two meat producers in the world -- are staking their futures on clean meat is not something to be taken lightly. These two companies are taking a long-term view, investing millions of dollars into the technology space, and they'll be key to commercializing clean meat for the masses.

Investors interested in being early adopters of clean meat should feel comfortable buying shares of Tyson Foods -- at the very least to keep up with updates from the new industry. Just know that the company will remain a traditional meat-producer for the foreseeable future.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.