The meat and milk section of the grocery store has been changing in recent years, notably filling with more non-animal-based products like soy, almond, and coconut milk and plant-based burger patties. With poor public perception of meat and milk production growing, particularly due to negative effects on environmental health, we may soon see the day when the supermarket fridges that once sold cuts of beef, chicken, and pork as well as the spread of milk cataloged by fat-content will be fully replaced by plant-based or lab-grown ingredients.
For meat and milk to be practical sources of nutrition, ranchers need a solution to make substantial progress on lessening the blow to the planet, for example, by improving feed intake and waste efficiency.
Vytelle is a precision livestock company reshaping how cattle producers worldwide optimize their herds by helping make mating and reproduction decisions. Through Vytelle’s integrated technology platform, generations of genetic gains can be sped up to just a few years, allowing producers to sustainably deliver more protein and helping to ensure meat and milk are competitive food choices for future generations.
Vytelle’s platform consists of three parts. First, individual animal data is collected and automatically communicated for processing. Second, artificial intelligence-based analytics transform phenotypic, genomic, and other data into easy-to-read dashboards and reports, supporting breeding decisions. Third, hormone-free oocyte collection and fertilization using semen from choice bulls, with fresh or frozen embryo delivery.
GEN Edge spoke recently with CEO Kerryann Kocher about how Vytelle’s integrated technology platform is accelerating genetic progress in cattle to help preserve the next generation of dairy and meat.
GEN Edge: What was the reasoning behind launching Vytelle?
Kocher: Vytelle’s purpose is to ensure that meat and milk are viable food choices for future generations. We’re focused on dairy and beef producers and enabling that meat and milk are viable food choices for future generations. Food has never had so many options. We’ve never had so many choices for protein as we do today with the onset of alternative proteins and cell-based proteins. So, making meat and milk viable means that we have to shift the way we produce them.
We have to be able to compete and meet the consumer demand for a sustainable, reliable, and viable food source for future generations. We know we have to pivot in this industry right now to be viable for the future. Never have we been in such a scenario as traditional protein producers where the demand for traditional meat and milk has been so high. To feed 9 billion people, we have to continue to produce more meat and milk and meet the demand that exists while doing that. We can always produce more, but doing it in an environmentally friendly and consumer accepted way generally comes with higher costs or new ways of doing things.
We have to couple that demand and the requirement for more with sustainability, and we have to have producers make money. This is all a cost to the producer, not the consumer. We have to have a balance in how we do that. Vytelle is trying to solve for the demand, sustainability, and profitability. That’s where we aim to come in with genetic progress as a solution to doing that.
GEN Edge: What IP has Vytelle developed?
Kocher: We’ve put together three core capabilities to make the first integrated technology platform specifically for genetic progress services. How do you drive genetic progress? First, you have to identify those elite-performing animals and identify them to a level of accuracy and precision that allows you to differentiate the best ones from the worst. When we think about that phenotype identification, we manage cattle in groups. We don’t manage them individually. Individual animal data is a real gap.
One of our core technologies is hardware that allows us to capture individual animal feed intake and weight gain while in production. Feed represents 70% of the cost of production. We are in a 1% margin business. So, you manage the cost. You manage the feed. There’s a huge bell curve on how animals are eating. We’ve got the world’s largest database on feed intake for cattle, and we see, on average, the ratio of feed-to-meat conversion is about seven to one. That means that there are animals at four to one, and that also means that there are animals at 15 to one. Think about the difference between how much it costs to feed an animal at a feed-to-meat conversion of 15 to one versus four to one. We need that level of detailed and accurate intake measurements to identify the elite performing ones.
From that perspective, we have hardware that follows animals while in their pen and into the bunks from that perspective. We identify them through an electronic ear tag. When their head goes into the bunks, we can measure how long they’re there and the amount of feed they eat to capture that individual animal’s feed intake. We do the same thing when they drink water and with measuring their body weight. We do that every single time they step on that scale to drink water throughout the day. We get billions of data points on their weight throughout the day. That allows us to build an algorithm for calculating a single daily weight. Now we can build a growth curve and feeding curve to identify which animals are eating and gaining.
The second core capability is being able to now relate that down to their DNA—being able to take a DNA, do a whole genome skin sequence, where our proprietary software allows us to connect those phenotypes to genotypes so we can look at identifying those unique genetic traits signatures that are representative and statistically driving that phenotype. We identify SNPs associated with those good performers, the four to ones. We can also identify the SNPs associated with the 25 to ones, and we don’t want to select those. We want to select the four to ones. It’s another layer of precision in that identification of elite performing animals that we want to reproduce.
The next step is once we’ve identified them is to reproduce them faster. This is where our in vitro fertilization (IVF) process comes in. Just like in human medicine, the traditional process for IVF requires the use of follicle-stimulating hormones that increase the size of the follicle so that the aspiration of those oocytes becomes easier to do. Labor is the currency in livestock production: we never have enough, and it costs a lot. We’ve eliminated the use of follicle-stimulating hormones.
We use IVF and have taken out 20% of the cost associated with it by tweaking that technology from what was done on the highest value population and now bring it into actual commercial production to produce embryos of those elite performing animals to ultimately speed up that generation interval. You’ve got a bull and a female in traditional cattle production, and they make one calf a year. It’s nine months of gestation. It’s 18 months to reproductive maturity, and then they go into gestation again before they can have progeny where we can even measure the success of the decisions that we made in the first place. It’s a decision that takes a minimum of three years. When we’re able to use our analytic engine coupled with IVF, we can now take a predictive view, make those generational decisions faster, and reproduce the genetic stock faster. It ultimately leads to a significant genetic gain for the producer.
So, we’ve brought all those together. We offer them as a service. We are not a genetic company. We don’t own cows. We are asset light. We do all of this as a service for producers. We have a wide range of employees: embryologists, veterinarians, quantitative geneticists, and bioinformatic data scientists as well as a sales team, to name a few.
GEN Edge: Who are Vytelle’s customers?
Kocher: If we just think about the United States, we have about 850,000 beef cattle producers. That’s a lot of beef cow producers. About 30% of them are professional cattlemen focused on that as a livelihood with no other sources of income. They have an average herd size of 40 cows. Then you have everybody else. Those professional herds are over 500 cows to be able to make a living based on ranching.
When you think about the structure of the industry, you have a group of producers that are solely focused on high genetic valued cattle. They breed cattle very specifically for the genetics of feed-efficient cattle. We call those the feedstock producers, and they are driving the genetic priorities of the industry. Those feedstock producers are selling their bulls and their replacement females into what we call the commercial cattle. A commercial cattleman is going to buy those bulls and use them in his commercial herd. All of those cattle are going to end up in the plains of Kansas, northwest Texas, and the Southern plains.
We focus our energy on those feedstock producers all around the world that make their money on selling genetics. Spring is bull sales season. Right now, all these seed stock producers are selling their stock in bull sales all over. You can see them everywhere. It’s every May. We target those producers, and we’re selling to them and partnering with them directly. The top 100 feedstock producers that are producing 20% of the bulls in the country, that’s where we spend our effort and demand generation capabilities fit. We then place our IVF labs in those areas. We have a lab in Salina (Kansas), Aimes (Iowa), Columbus (Ohio), and Brock (Texas). We just opened a lab in Albany, NY. The dairy corridor in the Northeast and down in Gainesville, Florida. Florida has the most cows out of any state. We put together our logistical play where our services are close to cattle.
GEN Edge: How is Vytelle trying to position itself in the near future?
Kocher: There are two decisions that cattle producers make that are high stakes. One is their breeding selection and reproduction method. Those decisions are the highest stake decisions that they can make because it drives the productivity of their cattle herd and the valve of the genetics that they’re selling. We aim to be right in the middle of those decisions through the precision identification of elite-performing animals from a DNA and phenotype perspective as well as from the reproduction method. We have been focused on how to increase the certainty, reliability, and accuracy of those decisions because that just speeds up the entire process. It also allows those producers to make those decisions with a higher level of certainty. That’s where we aim to play. All of our research and effort is focused on doing this.
We closed our Series A in 2021. While thinking about the milestones in 2022, we have been focused on scaling our IVF business and investing in an R&D pipeline. When we think about scaling, this year we’re targeting six new IVF labs. We’ve already opened three so far this year, and we’re expecting to open another one here in the United States and then two more outside the United States. There are 4,000 units of our hardware technology in the world today in 21 different countries capturing feed intake today. While that’s a really important part of our business, it feeds our database—the world’s largest database on feed intake—that allows us to really mine that information to identify cattle that are the best. We’ll continue to support that effort.
We have some pretty audacious goals on the product development pipeline and the R&D side. We want to get more certain about those breeding and reproductive decisions and improve the pregnancy rate of IVF to get it to be a standard procedure versus just a standard reproduction method. We see ourselves going in those two concentric circles of decision-making for the producer and investing hard in our scale-up and accessibility for producers.
GEN Edge: Does Vytelle license out the IP or have any partnerships pertaining to other proteins?
Kocher: Vytelle’s primary focus is to remain in the bovid space, which includes sheep and goats. Biologically they’re very similar, but also, the production systems are more in line with one another than they are with poultry and swine, for example, which are raised in a similar way. The production systems for sheep and goats are not exactly the same as those for cattle, but they’re more aligned in terms of the requirement of a lot of land. The production systems are different, so there’s not necessarily a plug-and-play opportunity.
This relates to the IP in three different ways. One is in the actual hardware and the mechanism behind how we capture the data. Two is in the data that we capture, how we use it, and what we can create from the insight that we gain from that information in aggregate. We have data policies and privacy policies like everybody else. We have full license to use the data for our own research and development purposes. We don’t own the data, but we have a license to use it.
On the IVF side, our culture media is the trade secret. That is the core technology. Building on that in the future will continue to be something that we leverage. We’re going to remain in that space. There’s plenty of opportunity around the world to continue to grow in that market and leverage the IP and the technologies that we have.
GEN Edge: How did launching Vytelle during the COVID-19 pandemic affect the company?
Kocher: From a very tactical perspective, moving people around and the logistics of our business has just been quite hard. For example, I had two employees who just went through five weeks of quarantine in individual hotel rooms in Shanghai where they were fed three meals a day and not allowed out for five weeks. I’ve had seven employees go through that routine. That’s just to get into the country so that we can produce the embryos there that we want to produce as we get started. That creates all kinds of lag and gaps in opportunities for us to start and end on time. Also, the New Zealand border recently opened up. We booked tickets the day it opened up so that we could get in there. We’ve got entities and businesses there that we haven’t been able to service because we haven’t been able to get in. The global aspect of our company has been hard to service during COVID-19 for sure.
GEN Edge: What trends impact Vytelle?
Kocher: We see the impact of the consumer’s perception around greenhouse gases and livestock production. That’s not going away. We have to overcome that, and we think a solution to overcoming that is genetic progress. The question is whether we can get enough people to do it fast enough. We’ve got a tremendous amount of momentum and opportunity to have a positive effect on the environment and consumers. We have to be able to do it with speed, and there’s a little bit of swimming upstream.