Irresistible Insects #6: Interview with FUTURENAUT CEO
Exclusive interview with pioneering insect-based startup FUTURENAUT is crawling with insights about what it takes to build an edible insect business in Japan.
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Good morning Market Shakers! This week’s installment of Market Shake features an exclusive interview with Ren Sakurai, the CEO of the Japanese cricket-based food startup, FUTURENAUT.
FUTURENAUT are pioneers of Japan’s emerging edible insect industry and Sakurai’s insights illuminate the keys to the market and its future growth.
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Inspired to change consumer attitudes towards edible insects, Sakurai founded FUTURENAUT
FUTURENAUT’s website has multiple pages dedicated to the sustainable and health benefits of edible insects. On paper, the facts are a compelling reason to forget beef, chicken and pork, and consider crickets the future of food. But when we’re presented with a plateful of insect-based food, for most customers it’s a different story.
For Ren Sakurai, overcoming humans’ psychological aversion to eating insects was the challenge that motivated him to found FUTURENAUT.
FUTURENAUT was founded in 2019 by Sakurai in partnership with his professors from the Takasaki University of Economics. The company set out to produce and popularize cricket-based products in the Japanese market as sustainable future food.
The team at FUTURENAUT have certainly come a long way towards achieving their goal in such a short space of time. Since its founding, they have launched several cricket-based product lines including biscotti, wafers, and chips. They have also partnered with big brands like Japan’s no. 2 baked goods manufacturer, Pasco Shikishima, and EU-based cricket protein startup, Sens Foods, to bring edible insect products to the mass market in Japan.
The insect product market is going through a period of constant transformation
FUTURENAUT’s rapid iteration and product development are not uncommon in the edible insect market. The nascent state of the market - not only in Japan but globally, means there’s limited market data to guide and inspire companies. Naturally, startups and organizations are experimenting and innovating to try and find products and strategies that work.
Many of the companies we introduced in our second and third newsletter of this cycle offer broad ranges of insect-based products. Chirp Chips (2013) for example makes tortillas, protein powders, cookies, and more. The diversity in the market is exciting; players have very different stories and trajectories. Trends are starting to emerge, however. We identified a focus on insect-based sports nutrition products in the US and Europe, for example.
In FUTURENAUT’s case, they began by targeting their products and marketing towards children.
Recently FUTURENAUT has been focussing on developing products that appeal to health consciousness - a big driver for Japanese consumers.
Health-conscious and young consumers are key demographics
Based on FUTURENAUT’s product innovation and iteration so far, Sakurai says that middle-aged women show the most interest in the edible insect market.
The reason? Health consciousness. This is a key driver for most demographics in Japan, but especially female customers.
Another factor in insect-based products’ appeal to middle-aged customers is price. Insect-based raw materials, which are generally imported from South East Asia by Japanese producers, remain relatively high priced because demand does not yet necessitate higher production volumes. Customers in Japan who purchase products like FUTURENAUT’s currently pay a premium price. Middle-aged customers in Japan who have more disposable income on average are therefore more likely to buy.
On the other hand, younger consumers, especially children, present an opportunity for insect-based products. Marketing edible insects to children is a smart strategy because they have not yet developed biases against insects. Also, once used to consuming insects at a young age, they will naturally incorporate them into their diets in the future.
Increasing the availability of edible insects is the biggest challenge in Japan
Of course, FUTURENAUT aspires to open up edible insect products to all demographics in Japan. This goal is key for growing the market. Sakurai believes that the first hurdle to overcome is the limited availability of insect product options in Japan.
FUTURENAUT does a lot of promotion to increase awareness about edible insect products in Japan. They have a dedicated website with educational material about the benefits of edible insects, and even recipes for insect products consumers can try at home. They also attend events to promote their products.
For Sakurai, though, collaboration is the key to increasing consumer access to insect-based products.
Sakurai is also proud of a big collaboration between FUTURENAUT and Japan’s second-biggest baked goods manufacturer, PASCO Shikishima Corporation.
In 2020, and again in 2021, FUTURENAUT collaborated on a range of cricket-based financiers and Baumkuchen under the Cricket Cafe brand. The products were sold via Pasco’s online store. The webpage includes educational information about the nutritional benefits of crickets, and how their sustainable production can help to avert a looming food crisis.
Collaborations between startups and large manufacturers is an important strategy in Japan for increasing consumer confidence in new products. Big manufacturers' support of edible insect products will steadily help to get them on Japanese consumers’ radars. But there’s a lot more work to be done, according to Sakurai.
The future of insects in Japan depends on collaboration, regulation, and reduced raw material costs
To establish edible insect products in Japan, Sakurai believes collaboration with big manufacturers and companies is key.
To this end, FUTURENAUT is seeking to participate in accelerator programs such as TOKYO NEX, which they have recently been selected for. The program is designed to network startups based outside of Tokyo with government, university and business contacts in the capital.
When asked about how the market for edible insects in Japan will grow over the next 10 years, Sakurai was quietly optimistic.
Sakurai added that increased regulation of edible insects in Japan where there are no formal regulations would go a long way to making it easier for startups and companies to enter the market.
Japan has yet to establish any formal regulations regarding insects as food for human consumption. Official guidelines, such as production and food safety standards, are a form of approval that the Japanese market is open to edible insect products. As businesses and startups increasingly show interest in insect-based business, it makes sense for Japan to get a head-start and prepare regulations now so players feel confident about market entry in the future.
Currently, FUTURENAUT is involved in lobbying the government to take steps towards this, starting with a commercial organization for insect-based products. In Japan, where relationships are particularly important for business, industry groups like Japan Soft Drink Association can make a big difference to business growth. Knowing that edible-insect companies are working on this should be reassuring news to companies hoping to enter the market in Japan.
Is Japan ready for overseas entry?
But, what about companies overseas with an eye for bringing their insect-based products to Japan? We asked Sakurai, and his response was, ‘not just yet!’
That’s all, folks!
There you have it! A big thank you to Ren Sakurai, for taking the time to interview with us and for giving such fascinating answers.
Japan’s edible insect market is still a small chrysalis, but startups and companies are thriving with activity and innovation within. Will a beautiful butterfly burst forth in the future, bringing with it a thriving market for edible insects in Japan? Probably not so soon. We’re more likely to see a gradual emergence of edible insect products in the Japanese market, led by a collaboration between edible insect startups and larger companies.
Stay tuned for next week’s issue where we will be bringing you an interview with Ÿnsect, Europe’s leading insect protein producer.
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