Factors Shaping the Business Development of the Alternative Protein Transition: A Systematic Literature Review

Abstract

Alternative proteins (APs) have the potential to contribute to the sustainable transition of food systems. This study aims to assess the current stage of development of the alternative protein industry, identifying factors, both barriers and enablers, that influence business growth. The analysis adopts a systematic literature review, following the PRISMA guidelines, identifying 50 studies. The S-curve model is then applied as an analytical tool to determine the development stage of the AP industry concerning plant-based, insect, and algae segments. The application of the S-curve provides a perspective on the evolution of innovative business such as AP. The results reveal significant differences in the maturity of the AP industry. The plant-based one is the most advanced, characterized by strong market organization and collaborations, despite challenges such as price competitiveness. The algae industry is promising due to its versatility, yet it is hindered due to production costs and unstable demand. Insects face the greatest barriers, including consumer acceptance and ethical concerns. The study emphasizes the importance of creating business strategies suited to each AP source to transform barriers into opportunities. This review contributes to the literature by comparing the unique peculiarities of the AP industry and providing insights from a cross-analysis of plant-based, algae, and insect development stages.

1. Introduction

The anthropogenic pressures on the earth system have reached unprecedented levels, and the socio-economic and health impact related to climate change and environmental crisis urges action [1]. The food sector has come under increasing scrutiny, urging action to move towards sustainable food systems by producing and consuming healthier and more environmentally sustainable food [2]. Many concerns revolve around the negative externalities of the overproduction and overconsumption of meat, including high land and water use, unhealthy properties, and a lack of animal welfare [3,4]. Food companies are participating in the sustainability transition of food systems by shifting to alternative sources of protein. Alternative proteins (APs) are both plant-based and non-plant-based sources of proteins, aiming to reduce the production and consumption of animal-based proteins and contributing to goals such as environmental sustainability, food security, animal welfare, and human health [5]. The present study investigates APs, with a focus on those identified in the reviewed literature, namely plant-based sources, insects, and algae.

Over the past years, there has been a rise in the alternative protein market, which was estimated at around $77 billion in 2022 globally [6]. Plant-based products are the most diversified and available on the market for consumers, hitting $8.1 billion for total sale in the US alone in 2023 [7]. The rise of AP is seen as an ongoing process occurring at different levels with the participation of multiple actors, including consumers, policymakers, innovative food companies, investors, and farmers [3]. The AP trend has favored the engagement of incumbent firms, such as big conventional meat processors, as well as new entrepreneurs, small start-ups, and investors [8,9].

Scholars have explored the realm of AP by delving into various aspects, particularly emphasizing consumer acceptance and nutritional values. This paper focuses on industry and AP business development, as AP businesses play a key role in promoting a change towards sustainable food systems. Previous studies with an industry and business focus have covered topics such as marketing [10,11], incumbents’ engagement [12], the entrepreneurial ecosystem [13], and upscaling operations [14,15]. With the expanding research on the AP industry, it is crucial to systematize these studies to gain a clear insight into the current landscape of AP. The study aims to answer the following question: what is the current stage of the development of the AP industry, and which factors influence it? To address this research question, the authors conducted a literature review of AP business studies, following the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) guidelines. The study identifies the factors that influence business development, building off of previous studies, and applies the S-curve as an analytical tool to determine the business development stage. The authors adopted the S-curve as a widely employed tool to illustrate the developmental trajectories of innovative business, such as the AP industry. The outcome of barriers and enablers identified through the analysis of the reviewed studies was used to evaluate the positioning of AP businesses along the S-curve.

2. Conceptual Framework

According to the literature, the development of innovative businesses is neither linear nor deterministic, unfolding instead through phases shaped by social, technological, economic, managerial, and behavioral challenges [16,17,18]. The S-curve offers a dual perspective: from a systemic viewpoint, it captures structural changes in the business environment, such as the presence of incumbents and lobbies; from a product diffusion perspective, it highlights the market potential and maturity of innovation, including factors like market demand and technological advancements. This integrated approach offers valuable insights into managerial influential factors and their evolution throughout the stages of business development [17,19,20,21,22,23,24].

To better represent this progression of business through various stages, the S-curve is segmented into four distinct phases: predevelopment, take-off, acceleration, and stabilization [17,25,26] (Figure 1). In the predevelopment phase, the business explores the current market situation to determine the best strategy for its product. Once the exploration phase is completed, the business enters the take-off phase, marked by rapid growth and increased market traction. In the third stage, the business gains widespread societal acceptance and support, driven by stakeholders such as consumers, researchers, and policymakers. Finally, during the stabilization phase, the business reaches full maturity [19,23,26]. Each phase of the S-curve is influenced by factors that can act as barriers or enablers, thereby affecting the rate at which a business progresses through its phases [17,21,25].

In this study, the purpose of the S-curve is to place each of the AP businesses into one of the four phases to comprehend their current level of advancement and enable a cross-analysis. The selection of influential factors used to determine the placement on the S-curve is based on the work by [27]. His research aligns with this analysis, as the authors identified a list of factors through a systematic review related to business model adaptation for sustainability transitions. A group of factors was faithfully adopted without any changes. A second group was adjusted, aggregated, or rephrased to better capture the AP business’s specific characteristics. The third group is original and was added by the authors based on previous literature on APs. The factors were organized into three macro-categories, enabling a multi-level analysis (

Table 1. Influential factors of AP business development selected and grouped into macro-categories.

Market

• Business Relationship **

• Consumer Acceptance and Cultural Environment *

• Health and Safety **

• Labeling and Product Claims **

• Incumbents **

• Market Demand

• Price **

• Resources Availability *

• Technological Advancement

Business

• Profits and Cost of Production *

• Skills or Knowledge

External Environment

• Environmental Sustainability *

• Ethics **

• External Support *

• Financial Issue

• Regulation

One asterisk (*) indicates that the influential factor has been adjusted from [27] original list, while no asterisk means it was faithfully adopted. Two asterisks (**) signify that the influential factor is original and was introduced to capture the specific characteristics of the AP business.

). The market category relates to the creation of an established market. The business category addresses internal factors that affect the development of individual firms. The external environment category covers external pressures that companies cannot control but must respond to. The final list of factors (Table 1) was validated based on the frequency of citations.

Following this conceptual framework, the authors identified the stage of development of AP businesses. The results taken into consideration include the balance between barriers and enablers, the occurrence among the selected articles, their relevance on a global scale, and the affiliated macro-category. By framing these dynamics within the S-curve model, the study seeks to offer a theoretical basis for analyzing the evolution of innovative products and their potential to overcome early-stage vulnerabilities, such as the “infant mortality” threshold, which can impede market stabilization [21,23].

3. Methodology

3.1. Data Collection

The present systematic literature review follows the PRISMA statement for reporting the results, as illustrated in Figure 2 [28]. The literature search was undertaken using two databases, namely Scopus and Web of Science, known for the richness of academic articles on the topic. The search for the studies was completed on 10 April 2024. The search was conducted with a comprehensive string using “OR” and * to enlarge the plethora of words identifiable using the string (

Table 2. Search string used in Scopus and Web of Science.

Search String

(TITLE-ABS-KEY (“textured vegetable protein*” OR “alternative protein*” OR “novel plant-based alternative*” OR “sustainable protein*” OR “plant-based protein*” OR “protein transition*” OR “meat alternative*” OR “meat substitute*” OR “meat analogue*” OR “hybrid meat*” OR “plant-based meat*” OR “non-meat protein source*” OR “substitute meat protein*” OR “seafood alternative*” OR “seafood substitute*” OR “seafood analogue*” OR “hybrid seafood*” OR “plant-based seafood*” OR “non-seafood protein source*” OR “substitute seafood protein*” OR “cheese alternative*” OR “cheese substitute*” OR “cheese analogue*” OR “hybrid cheese” OR “plant-based cheese” OR “dairy alternative*” OR “dairy substitute*” OR “dairy analogue*” OR “hybrid dair*” OR “plant-based dair*” OR insect* OR “insect-based food*” OR “insect-based protein*” OR “mealworm protein*” OR “krill protein*” OR “larvae protein*” OR “lupin* protein*” OR “dry pea* protein*” OR “chickpea* protein*” OR “cow pea* protein*” OR “pigeon pea* protein*” OR “lentil* protein*” OR “pulse* protein*” OR “legume* protein*” OR “bean* protein*” OR “pea protein*” OR “rapeseed protein*” OR “soy protein*” OR seaweed* OR alga* OR microalga* OR “microbial protein*” OR “cultivated mushroom protein*” OR “fermented fungal protein*” OR “bacterial protein*” OR “mycoprotein*” OR “whey protein*”) AND TITLE-ABS-KEY (“food system transformation” OR “food system innovation” OR “food system transition” OR “sustainable food system*” OR “food chain transformation” OR “food chain innovation” OR “food chain transition” OR “sustainable food chain*” OR polic* OR politic* OR legislation OR law* OR “regulatory framework*” OR “regulatory action*” OR “regulatory approach*” OR “government regulation*” OR “value chain*” OR “supply chain*” OR “agri-food chain*” OR “agro-food chain*” OR stakeholder* OR governance OR “chain manage*” OR “business model*” OR “business development*” OR “incumbent firm*”) AND TITLE-ABS-KEY (food* OR feed*) AND NOT TITLE-ABS-KEY (insecti* OR pest*))

). The string captures every potential term used to refer to alternative proteins, words related to industry, business, influential factors, and the narrative of AP as part of the sustainability transition of the food system. Additional words were used to exclude the considerable number of studies on insecticides and pesticides and identify AP studies only on food and feed. The types of alternative protein included in the search are plant-based, insect, algae, microbial, and whey protein. Plant-based products aim partly or entirely to mimic meat by using plant proteins, such as cereal and legumes, as key ingredients [5]. Algae are regarded as a distinct category from traditional plant protein sources, owing to their relatively recent recognition as protein-rich foods [5]. Microbial proteins were included in the study, even though no studies emerged from a literature review.

The search on Scopus and Web of Science yielded 2757 and 2073 results, respectively. After the elimination of duplicates, studies were screened based on the relevance of the title, abstract, and keywords, according to the aim of the paper. Articles without English texts were excluded. The remaining 310 studies were assessed based on the methodology. If a methodological approach was not applied, articles were classified as opinion articles and excluded. Studies based solely on literature review were excluded. This step aimed to include only papers based on a methodological approach and the elaboration of new results. The resulting 116 articles went through a detailed full-text reading. Sixty studies were eliminated due to their lack of relevance to the paper’s aim. Six studies were excluded based on their outdated findings and the limited explanatory contribution. Finally, 50 studies were included in the analysis. The full list of reviewed studies is available in the Supplementary Material. The process of assessing the studies was co-participated in by two researchers through an equal division of the workload and periodical meetings. When uncertainties over the eligibility of an article emerged, the two researchers discussed them to find a consensus, and a third researcher was included in the discussion.

3.2. Data Analysis

The analysis of the reviewed studies included two steps. First, the reviewed studies were classified based on the studies’ characteristics. More information on the geographical distribution, temporal distribution, and methodology adopted is discussed in the Supplementary Material. Second, the data analysis involved a qualitative content analysis based on the list of influential factors elaborated, as discussed in Section 2. The authors selected references related to the influential factors and classified them as barriers or enablers. Influential factors may apply both as enablers and as barriers. A paper could include references to various influential factors related to different macro-categories. This methodology relied on the whole team of researchers coming to a mutual agreement. The step of extrapolation of references and their classification as influential factors was co-participated in by three researchers. Two researchers collaborated to conduct a comprehensive examination; each scholar evaluated half of the literature independently and subsequently analyzed the coding results produced by the co-researcher. When disagreements emerged, the two authors collaborated to achieve consensus, enlisting a third researcher to help resolve any outstanding issues. The selected references were summarized to facilitate the process of assessing the results. Each reviewed study contributes to the findings by highlighting one or more relevant factors for the analysis. While a subset stands out due to their high citation count in the present study [10,18,29,30,31,32], all studies offer meaningful contributions to the broader understanding of the subject.

4. Results

4.1. Market

4.1.1. Market Demand

The results suggest that the various AP sources have different levels of demand. The algae industry has grown significantly over the past decade, with a 150% increase in new producing firms, and further growth is expected, particularly for species with high commercial value [29,30,31,32]. Despite this, the reviewed studies lament a generally low demand for algae products in Europe and limited market connections [33]. The fluctuating and limited market demand for products intended for human consumption, which is highly dependent on commodity exportation, is identified as a significant risk to the economic stability of seaweed aquaculture [34,35].

Insect-based food products suffer from volatile and insufficient demand, which are significant barriers to business development for processors and food producers [36]. Yet, insect-based feed has shown strong interest among farmers, indicating robust market potential [37].

The consensus of the expanding market of plant-based products is higher compared to the two other proteins. The plant-based industry is driven by market optimism, which has spurred innovation and the establishment of successful firms [18]. Increased demand for sustainable food has driven demand for meat substitutes, leading to market expansion and increased shelf space in both Europe and the U.S. [10,12,18,38]. Plant-based products are promoted to capture new market segments, with projections suggesting they could occupy 25% of the global meat market by 2040 [39].

4.1.2. Price

Algae prices are high and variable, which disincentives the farmers’ interest [29]. The significant price variability and weakening of the international commodity price of algae are also influenced by the major international players. For example, the participation of China in the algae value chain has changed its governance: since the early 2010s, China has participated in the algae market by using “campaign buying” schemes, buying a large amount of seaweed when the price is low, especially from Indonesia [32,35,40]. Natural disasters and the seasonality of algae production also contribute to price fluctuations [29,31,33].

Plant-based products are generally more expensive than animal-based products [38,39,41,42]. A study found plant-based meat alternatives to be a third more expensive and sold in smaller quantities than conventional meat [43]. In particular, one reviewed study mentions price as a great obstacle to consumption by non-vegans people, which tend to be more price-sensitive compared to vegans [13]. High and volatile agricultural food prices limit farmers’ interest in plant-based protein production [44].

For insect producers, excessive prices and price fluctuations pose significant risks to business performance [14,36]. High production costs make them economically unviable for mass animal feed [45]. The literature mentions the example of Black Soldier Fly Larvae prices, not competitive with conventional protein sources, requiring changes in production systems for better pricing [46].

4.1.3. Consumer Acceptance and Cultural Environment

Insects’ products are the most pressured by consumer acceptance. The lack of consumer acceptance is particularly pronounced in countries without a tradition of eating insects and with a strong gastronomic culture [47,48,49]. The insect industry struggles with social acceptance due to the yuck factor [36,46]. Though consumer acceptance is an enabler for the insect business in countries where edible insects are already traditional and integral to local diets and feeding practices. Examples of such countries include African countries like Uganda and Madagascar, contributing significantly to local economies [47,50,51,52]. Furthermore, the literature also discussed that, in the Netherlands, for example, insects are receiving increased media coverage with both positive and neutral tones [48].

Previous literature on the consumer acceptance of algae-based products mentions that these products struggle with negative public perceptions concerning the management and social acceptability of aquaculture practices [29].

Plant-based proteins have increased their consumer acceptance. Plant-based proteins have transitioned from being primarily associated with Asian cuisine to appealing to wealthier, diverse consumers in Western markets, driven by the rise of flexitarian and vegetarian diets and negative attention to livestock [18,38]. Media and influencers also play a significant role in promoting plant-based products, catching the interest of a broader consumer group, rather than strict vegan identities [10,53]. Marketing strategies focusing on health benefits and ethical and environmental value further enhance consumer acceptance by associating them with the positive brand image [11,13]. Despite this, plant-based proteins still face consumer challenges, especially in countries with strong meat-based culinary traditions, where they are criticized for lacking strong flavor and poor texture [38,42,54]. Enhancing the sensory profile of plant-based meat and its popularity is seen as crucial for increasing acceptance and consequently demand [55].

4.1.4. Health and Safety

In general, AP are praised as a healthy alternative to livestock protein, as discussed by reviewed studies [42,56]. For example, algae are rich in protein, fiber, minerals, and vitamins [29,30,33]. Their high nutritional profile also favored their use as food supplements [29,30]. However, algae-based proteins, particularly from the seaweed farming industry in Malaysia, suffer from poor quality control during drying and a lack of awareness of quality standards, which may pose significant health risks from toxin accumulation in macroalgae, such as heavy metals and bacteria [30,32,57].

Insects are praised for their high content of proteins, fat, and minerals. However, they are criticized for potentially antinutrient properties and food safety risks, including their role as pathogen carriers or containing pesticide residues [37,51,52,58]. These risks are associated with the type of feed used for rearing insects and the lack of regulation on the production process [14,46].

Regarding plant-based products, several studies have indicated that they are a healthier alternative compared to conventional meat, especially thanks to the high nutritional profile of legumes [43,59]. However, plant-based proteins face health concerns about low-quality ingredients and their highly processed nature [38,41,42].

4.1.5. Labeling and Product Claims

Labeling is a barrier affecting insect products. In their studies about insect products sold online, a previous study [49] found that many products were lacking processing and storage information due to incomplete or inaccurate labelling requirements imposed by new regulations, limiting consumer safety and their trust.

Labeling and product claims are both identified as barriers and enablers for plant-based products. Plant-based proteins face poor and confusing advertising due to the controversial topic of using meat-sounding labels [38]. Animal industry groups have opposed the use of meat-sounding labels, prompting legal restrictions in several European countries [18]. Furthermore, plant-based products are characterized by a lack of information on the origin and processing, which complicates labeling and marketing [38]. At the same time, product claims act as an enabler by highlighting environmental benefits through marketing strategies, mission statements, and social media campaigns, attracting a wider audience [10,60]. These products are marketed with claims such as “food for all”, emphasizing taste and authenticity, aiming to reach beyond the vegan niche [11].

4.1.6. Incumbents

Reviewed literature acknowledges the role of incumbents in enabling market development, acknowledging a proactive approach to sustainable food transitions. A clear example is given by the plant-based industry: major meat producers and food firms, including Tyson, Nestlé, and Unilever, are now heavily investing in plant-based R&D and production with partnerships and acquisitions of plant-based start-ups [10,11,18]. Retailers, like Albert Heijn in the Netherlands and Whole Foods in the US, support this growth by offering shelf space to new entrants, paving the way for larger commitments [12,61]. Food services are partnering with plant-based companies too, including Burger King, which was the first global fast-food chain to introduce plant-based burgers on its menu [10,12].

At the same time, the lack of incumbent engagement is stated as a barrier for insect companies struggling with incumbents, which are mostly observing the market with limited active participation [51].

4.1.7. Business Relationship

The insect business network is still young and disorganized, with a limited number of companies in operation [62]. Authors lament a general lack of collaboration between companies, limiting the upscaling of production and the impeding agreement on industry standards [14,51]. The limited cases of collaboration between businesses happen mostly through informal channels and have focused on overcoming regulatory challenges [36].

In the case of the algae industry, there are issues related to ineffective collaboration. For example, intermediaries view local seaweed farmers as inactive and inefficient, often dependent on government support and producing low yields [32]. Trust plays a crucial role in the algae business, particularly among seaweed farmers and intermediaries. Informal credit, farming inputs, and trusted relationships are essential for transactions and maintaining social license [32,63]. The reviewed studies also mention that algae face heavy competition, especially from Chinese produce in the North Sea [34,40].

The plant-based industry exhibits strong collaboration, particularly among small firms. Formal associations like The Planet and the Green Protein Alliance facilitate market development, align with sustainability norms, promote collective action, and facilitate knowledge sharing and joint product development [18,53].

4.1.8. Technological Advancement

The literature mentions that the AP industry faces significant technological barriers impacting scalability and efficiency, while also benefiting from technological progress. For example, insect-based products suffer from a lack of mass rearing techniques and automation, limiting large-scale production and commercial use [14,36]. Seaweed aquaculture is considered technologically reliable and straightforward, with experts acknowledging its solid foundation and simplicity in cultivation [35]. However, reviewed studies call for more advanced cultivation technologies for algae to upscale production and reduce costs [15,29,35]. Inadequate processing infrastructure and storage further complicate algae sustainable production [30,33].

For plant-based products, technological progress and the development of higher-performing products have been crucial for attracting a broader consumer base beyond dedicated vegetarians and vegans, ultimately driving market expansion [18]. Nonetheless, plant-based companies struggle with developing and applying new processing technologies, and farmers face challenges in accessing and scaling these technologies [38,59].

4.1.9. Resource Availability

In the insect industry, high demand for feed and sourcing difficulties create bottlenecks in scaling up production [14,45]. Constant supplies of feed are essential but difficult to maintain due to logistic hurdles like transportation costs and waste collection [48,62]. Algae production similarly struggles with resource issues. A network of seed supply is necessary for small-scale projects and may be a major challenge [35]. Thus, local farmers often cannot produce enough seaweed to meet processing demands, leading to reliance on imports, and have limited access to drying space [32]. Furthermore, past studies indicate that in some EU countries, domestic plant-based protein supply falls short of meeting the demand. Consequently, enhancing domestic supply and identifying new plant protein crops are essential measures to bolster the plant-based sector [11,55].

Resource availability can also act as an enabler, thanks to easy access to resources and the geographical position. For instance, Alaska’s extensive coastline supports seaweed farming with minimal industrial conflict [30]. The Atlantic coasts’ large intertidal areas and abundant seaweed species have historically supported the growth of the algae industry [29]. In the case of plant-based production, a previous study mentions that Brazil’s natural resources, favorable weather, and extensive agricultural experience position the country as a leading player in producing plant-based ingredients [42].

4.2. Business

4.2.1. Profits and Cost of Production

The reviewed studies suggest that AP remain non-competitive with traditional protein sources [29,62]. For insect-derived products, the primary issue is the high costs associated with production and processing, including costs for energy and the high capital investment needed for automation and technology [45,46]. Additionally, high labor costs, which can constitute between 65 and 90% of total production costs for small-scale insect farming, and unexpected expenses further hinder market competitiveness, especially for SMEs [14,36,46]. Similarly, the algae business is limited by high operational costs, including labor costs [15,34]. However, seaweed aquaculture is recognized as a profitable business in some countries like Chile, Indonesia, Philippines, Tanzania, India, Mexico, and the Solomon Islands [34,35].

For plant-based products, the literature review discusses the issue of low profits for plant protein farmers and the high cost of production for vegan processors, for which producing plant-based meat analogues often costs more than animal-based equivalents [44,53]. Nonetheless, plant-based businesses may also have cost-saving potential: for example, in the feed industry, substituting fish meal with plant protein sources can significantly reduce costs [64].

4.2.2. Skills and Knowledge

For insect-based proteins, farmers face significant knowledge gaps regarding insect farming techniques and starting an insect-rearing business [14,48]. Limited knowledge on insects’ use as ingredients is seen as a major constraint for food producers [36]. An exception to this is the insect industry in the Netherlands, which is positioned as a potential leader in the insect market, thanks to its expertise in climate control, farming, and logistics [51].

In the algae industry, experts highlight a lack of experience in commercial-scale cultivation and poor quality of training programs as significant disadvantages [35]. There is also a lack of awareness of quality standards and safety and health measures [32,57,65].

At a different level, the reviewed studies on the plant-based industry discuss the significance of internal innovation management and the role of motivated, specialized labor in driving business growth [13,18]. Plant-based businesses benefit from effective innovation management and ease in hiring skilled workers [13]. Yet, reviewed studies acknowledge the lack of skills and knowledge on growing plant proteins, limiting farmers’ propensity to transition to these crops [42,66].

4.3. External Environment

4.3.1. Financial Issue

The insect industry is constrained by a lack of large-scale investment and limited access to subsidies, especially for processors and feed producers [14,36,48]. Yet, a positive case study comes from the Brazilian market, where the insect industry has attracted substantial private investment, particularly in research related to the protein capacity of insects [62].

Small-scale algae firms and indigenous farmers face barriers in accessing financial services, limiting their ability to scale up production [57]. These challenges are exacerbated by short-term funding programs, which hinder research, training, and the overall development of seaweed aquaculture [35,57]. The situation seems to be different for algae companies in Indonesia, Malaysia, and Chile, which have benefited from private investments and low-cost initial investments [32]. Previous studies acknowledge that algae production in Indonesia was pushed by significant international investments from Chinese companies [40].

The plant-based industry, while receiving investments from major meat firms and some subsidies under greening measures and voluntary coupled support schemes within the EU Common Agricultural Policy, suffers from a discrepancy in subsidy levels compared to animal products, reducing the comparative advantage and attractiveness of these crops for farmers [18,44,67].

4.3.2. External Support

The insect industry laments the lack of governmental support and business initiatives, which indicates a reliance on academic and non-governmental organizations for advancement [46,48]. On the other side, the literature acknowledges established lobbying efforts, such as the International Platform of Insects for Food and Feed, to enhance its sociopolitical legitimacy and represent the industry in Europe [51].

The literature discusses opposite dynamics for the plant-based business where stakeholders struggle with insufficient lobbying power to compete with established industries like dairy and meat but benefit from governmental and NGO support [38]. Government involvement through investment programs provides financial support to start-ups, facilitating the improvement of product performance and boosting entrepreneurial and knowledge development projects [18]. A case study on plant-based NGOs is presented in one reviewed study [68], which analyze the Donau Soja organization. The organization has promoted sustainable soy production and favored protein transition over the years. This support is driven by increasing awareness of sustainability and environmental benefits, fostering a favorable environment for innovation and market expansion [18].

4.3.3. Regulation

For insect-based proteins, the main issues are stringent legal restrictions on using waste by-products and insect meal in feed [36]. This regulatory uncertainty, particularly strong in the EU, impedes further investment and development [14,47]. Similarly, algae-based proteins suffer from unclear regulatory frameworks, adding to costs and complexity [30,35]. Regarding plant-based products, political and legal barriers, higher taxes on plant-based beverages, and bureaucratic delays hinder innovation and market entry [13,44]. Plant-based businesses call for regulatory changes to improve tax incentives and ensure fair competition, including fair labeling laws and removal of subsidies for animal products [55].

Past studies also mention examples of policies that acted as an enabler of business development. For example, the Netherlands’ policy support and regulatory exceptions have facilitated early-stage innovations in insect rearing [48]. Similarly, the EU regulatory shift in 2017, which allowed insects to be sold as human food, led to rapid expansion and reconfiguration of the business [47]. For algae, government regulation of labeling is vital in shaping the food quality market by addressing safety concerns and dispelling consumer misconceptions [30]. Chile’s new policy promoting algae cultivation significantly boosts industry growth, potentially creating a local market for seaweed aquaculture and encouraging restocking, restoration, and polyculture initiatives [35].

4.3.4. Environmental Sustainability

In general, the reviewed literature highlights the environmental friendliness of AP, thanks to lower land and water use, and lower CO2 emissions [30,35,52]. These environmental benefits have attracted the interest of food businesses, encouraging their adoption and implementation [10,33,52]. Despite this, the reviewed literature also mentions some critical challenges. Insect production grapples with ecosystemic issues such as overharvesting, which can lead to decreased insect populations and environmental degradation, potential invasiveness in non-native environments in the case of escaping, and the intensive energy requirements for farming insects, influenced heavily by temperature [14,48,52]. Similarly, the environmental impact of algae cultivation is under the spotlight in several regions due to overharvesting, which can negatively impact biodiversity and increase coastal erosion and reduce fish nursery habitats [29,63]. The plant-based business is based on commodity production systems and industrial practices, resulting in a potential intensive use of energy and natural resources such as water [10,69].

4.3.5. Ethics

The shift towards plant-based products reflects growing moral concerns within the animal production industry, where some workers and producers feel conflicted about using animals for food, though addressing these concerns can be seen as a betrayal of the industry [39]. A previous study [53] highlights how the plant-based business is deeply connected to animal welfare activism: small plant-based firms, such as restaurants and grocery stores, often operate with a mission rooted in animal rights and ethical consumption.

Opposite to this, ethical concerns related only to insect farming, such as insect welfare, emerge from the literature review [45]. Cultural and religious beliefs, such as those held by Buddhists, who view the mass killing of insects as harmful to their karma, also pose ethical challenges and may influence public acceptance and considerations in insect farming [48].

5. Discussion

The current work shows that previous studies discuss influential factors for AP business development at multiple levels of action, highlighting a combination of barriers and enablers. The AP market emerges as a complex and multifaceted one. This section interprets the findings on business performance to determine the developmental stages of the AP industry based on the S-curve analysis (Figure 3).

In line with previous studies and reports, the plant-based sector is placed in a significantly more advanced stage, a stage exhibiting strong acceleration based on the following criteria [18,22]. First, the plant-based has a balance between enablers and barriers. This result reveals that a group of influential factors, which still act as barriers for insects and algae, have already been addressed in the plant-based business, transforming them into enablers. Second, the market demand factor emerges as a critical determinant. This paper confirms that the plant-based business is a frontrunner in the AP market, thanks to strong and positive growth and the ability to attract investors and incumbents [7,12,39]. Nonetheless, the plant-based business needs to reach the stabilization stage to shift from a niche to a mainstream segment of the food market. Previous studies have emphasized the necessity to decrease production cost and price to reach a grower consumer base [13]. Studies suggest that higher investments in R&D and scaling up, and higher government support are key actions to foster this change [18,38,53]. On a different note, the present paper suggests that the marketability of plant-based products could come by strengthening enablers such as health benefits, environmental sustainability, and ethical considerations as key product attributes. These attributes not only resonate with consumer values but also provide a rationale for the higher price point, positioning plant-based products as premium and sustainable options in the global protein market.

Insects are positioned in the pre-development phase, and algae are slightly further along in a potential transition towards the take-off phase. Algae are positioned at a more advanced stage along the S-curve compared to insects for the following reasons. First, algae show a more balanced interplay of barriers and enablers, particularly in terms of market demand, profitability, production costs, and financial issues, demonstrating growing attention from various stakeholders. Second, algae have the advantage of being a resource suitable for diverse applications [29,40]. This versatility allows companies to diversify the range of clients and reduce production costs through economies of scale. By further focusing on product diversification, the AP business could experience significant growth. On the other hand, insects face significantly greater challenges regarding consumer acceptance, which remains a critical barrier to their broader adoption. As a result, the idea of insects as a global food source remains contentious, and they risk being permanently confined to the “infant mortality” stage. Insect businesses may benefit from diversifying their client base and initially prioritizing the feed and pet food sectors, which may offer quicker market return compared to the more regulated and consumer-sensitive food sector. Similar to the case of algae, the insect industry could leverage the inherent versatility of insect-derived ingredients—both in terms of sectoral applications (food, feed, and pet food) and potential food formulations (e.g., meat analogues, snacks). Nonetheless, achieving this expansion will require a certain level of openness and acceptance of insect-based ingredients by stakeholders within the food and feed industries [36].

The interpretation of funding trends suggests that, although APs are frequently discussed as a single category, it is essential to consider the specific characteristics and needs of each business segment to effectively support their development. Lessons learned from more mature segments, such as the plant-based industry, can provide valuable guidance for the growth and strategic advancement of emerging segments within the AP industry. Furthermore, barriers should not necessarily be viewed as obstacles to overcome but, rather, as natural limits that guide the sustainable development of a business. When approached strategically, these limits can highlight opportunities to maximize business capabilities while maintaining sustainability. For instance, resource availability can be reinterpreted as an opportunity to adopt production models that are tailored to local contexts and prioritize ecological balance. Insects and algae firms could capitalize on their unique attributes to establish niche roles using region-specific production models, rather than aspiring to the same global reach as the plant-based business. Furthermore, the multi-level set of barriers and enablers highlight that the AP industry requires a coordinated set of measures, particularly emphasizing the need for joint efforts between the public and private sectors to accelerate the protein transition and support the shift of these ingredients from niche markets to mainstream adoption.

6. Limitations and Further Research

One of the limitations of the present study is that it may not cover all the published academic knowledge on the topic. For example, only sources in English were used. To limit the negative impact of this, the researchers used two databases and built a string with a broad and inclusive set of terms. Furthermore, the authors decided to exclude gray literature and focus on peer-reviewed studies, a common approach in reviews reported using the PRISMA framework. Nonetheless, in recent years, the body of gray literature on AP has expanded significantly, primarily through contributions from non-governmental organizations and consultancy firms, offering an additional source of information.

To further explore the findings of this study, future research could adopt a mixed-methods approach. Combining systematic reviews with interviews or focus groups could provide a more comprehensive understanding of the topic. Additionally, future studies could explore the geographical differences highlighted in this research in greater depth. Comparative analyses across regions with varying levels of AP market development could help identify the best practices and region-specific challenges. These studies could also consider the role of local policies, cultural factors, and economic conditions in shaping the growth trajectories of AP businesses. Finally, further research should examine the dynamic interplay between influential factors over time. A longitudinal approach could track how these factors evolve and interact, offering a clearer picture of the long-term potential for each AP business.

7. Conclusions

The transition to sustainable food systems depends on the ability of companies to address environmental, social, economic, ethical, and health challenges. The AP industry could play a crucial role in this shift, yet its development remains uneven. While the plant-based industry demonstrates promising progress compared to insects and algae, AP products are still far from being considered sustainable solutions for consumers worldwide. A strategy is essential to enhance their accessibility for consumers—both in terms of availability and affordability—and to increase their attractiveness for farmers, businesses, retailers, and food services considering a transition to these novel sources.

This study provides an understanding of the current state of the AP industry through the macro-categories of market, business, and the external environment and identify starting points to accelerate this transition. A greater collaboration between the private and public sectors could support the AP industry to transform barriers to enablers and strengthen the AP contribution to the sustainability transition, helping to redefine the future of global food systems.