#69 Virginia Emery, CEO of Beta Hatch, a pioneering insect farming company

Virginia Emery is founder and CEO of Beta Hatch, a pioneering insect farming company that is industrializing insects for agriculture. Beta Hatch is fueled by a passion to see insects reach their true potential in our food systems. The company has grown to be internationally recognized for its scientific approach to scaling insect production, and operates North America’s largest mealworm farm for animal feed production in Washington. Virginia is the country’s most innovative insect entrepreneur, recently recognized as a Visionary Grist 50 Fixer. Virginia has a PhD in entomology from the University of California, Berkeley, has been awarded over 20 grants and honors, and has published on subjects ranging from chemical communication to genetics to insect behavior. Her life’s mission is to breed a bug that tastes like bacon.

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This transcript has been lightly edited for readability.

Host Raj Daniels  04:23

What spurred you towards entomology? 

Virginia Emery  04:33

Most people don’t realize what it is to be an entomologist. That’s someone who’s a specialist in insects. I got started in biology. At an early age, I’ve always sort of been a biologist in terms of where my interests were. But entomology and the study of insects really took off for me in college, and particularly in grad school. I think just realizing that insects do all of the things that we consider to be uniquely human, they have agriculture, they have a form of ranching, you get, you know, ants, for example, that take care of aphids, that farm fungus, they form societies, they have very complex communication. And it’s all with these tiny little brains that allow them to do incredibly complex things. And so I’ve just always been fascinated by the biology of insects. And that’s sort of what got me started in exploring your career and entomology.

Host Raj Daniels  06:38

So you mentioned Beta Hatch. Can you share a little bit about your current organization?

Virginia Emery  06:43

Yes, so I am the founder and CEO of a company called Beta Hatch. We are based here in Washington, and we farm insects as a feed ingredient. So we are an insect farming company, very much a biotechnology company, it’s a lot more complex to grow insects than people would expect or think. I know a lot of people grow insects accidentally on their kitchen counter when they’ve got a fruit fly infestation. But to do it at a large scale, in a reliable and predictable way that is meaningful for agriculture requires a lot of technology. And so we have been developing the technology to produce these insects at massive scale. We’re doing this because insects are a part of the food system. And there’s a lot of benefits that they can bring to us in the supply chain. We just haven’t developed the tools to use them in that way. You know, the food system works best when it models nature. And in nature. Insects are the bio recyclers, and they’re the foundation of the food chain. Birds fish all kinds of animals eat insects, naturally. And so it just makes sense that we should have them as part of our food system. So we’ve been working to develop them as a tool for doing just that. Well, the company is really pioneering this this new crop of insects.

Host Raj Daniels  08:03

So what do you use the insects for?

Virginia Emery  08:06

The insects are grown as a form of protein, and fat, so proteins and oils, and we use them for animal feed. So the main consumers of our insects are aquaculture and poultry and pet food. So all kinds of fish and shellfish, birds, you know, turkeys, poultry of different types. And then pet food, cats and dogs can all eat insects, and it’s a high density, high nutritional value ingredients. We are working to have this ingredient as part of a balanced diet. So this would just be one component of a formulated feed for those animals. But insects really are a great sustainable and nutritious alternative to some of the existing ingredients that we use to feed those animals.

Host Raj Daniels  09:04

And what kind of insects do you use?

Virginia Emery  09:07

We grow the mealworm, a type of beetle. It’s also called the darkling beetle. Because they like to live in the dark. They don’t require a lot of light to grow. The mealworm is the larval stage. So the beetle is the adults they lay an egg which will hatch into a larva. They grow throughout a period of several weeks, a portion in our farm become adults again for reproduction and they go through a pupil stage they become a pupa kind of like the cocoon stage and then become adults again. And so that’s the insect that we’re working with. It is a super bug. It’s can be farmed indoors year round. I can eat a huge range of different organic and even inorganic products and it is a natural diet for a lot of us. Animals extremely high in protein and fat coming in at between 50 and 60% protein and 30% fat on a dry basis. So it’s a really exciting insect to be working with. And we’re really keen to see it become a staple for the animal feed industry.

Host Raj Daniels  10:19

How much experimentation did you have to do before you landed on the beetle?

Virginia Emery  10:24

Yeah, that’s a great question. We, the company started off in my backyard. So I built a climate controlled shed and we, I played around with over a dozen different species, really just trying out different animal husbandry techniques. The mealworm was a clear winner. It’s a really hardy bug. So sort of one of the pivotal moments came during a particularly tough week, I kind of neglected the Beatles at that point for a few weeks, and I was worried they’d all died. And when I opened up their box, they were all still thriving and happy. So it’s a it’s a insects that does really well under a big range of conditions, it can eat a lot of different ingredients. And we’ve already have a history of domesticating them for exotic animal food and for fishing bait. And so all these things combined make the meal worm a really great insect for agriculture.

Host Raj Daniels  11:16

Thank you for that. You know, earlier you mentioned complexity and examples of technologies, can you share some of the challenges of complexities you’ve had, and what kind of technologies you’ve used to overcome them?

Virginia Emery  11:26

Yeah, so you know, we’re farming at a pretty large scale, our current facility that we’re building out here in cashmere, Washington, will do about a ton a day of insect production. So it’s, it sounds small in the scheme of animal feed, but it’s very large in the realm of what we’ve already produced for insects. So it’s a new scale of operation. And obviously, scaling, any production like that comes with all kinds of challenges. So we’ve had a lot of different biological challenges, you get some really interesting problems. So one example of what we’re dealing with right now is trying to think about the metabolic heat that the insects are making. So they are ectotherms cold blooded. So they will adapt to the conditions in their environment, they don’t produce necessarily a regulated body heat, but they do produce heat as they’re eating, converting their food into biomass. And so you end up having to incorporate in your air handling systems calculations for how much metabolic heat the insects are producing. It turns out our initial designs hadn’t really accounted for that metabolic heat properly. And so we’re having to look again at the cooling load on our HVAC systems to account for that. So that’s just one example, among a set of 1000s of examples of different things about the process of growing insects, the science behind it. We do a lot of biotechnology at our company. So we recently have had a manuscript accepted for publication of the genome. So we have sequenced the mealworm genome. And we’re starting to identify some really interesting things about the genomes of these insects and their their ability to really convert feed very efficiently, and to grow in certain ways. And so we’re really excited from a biotechnology perspective to continue to develop a genetic toolkit for working with this new crop.

Host Raj Daniels  13:29

Sounds really exciting. You know, we’re in the beetle right now. And I know crickets have been gaining traction over the last few years cricket powder for baking and in bars. What other insect opportunities do you see out there right now?

Virginia Emery  13:41

Yeah, there’s a lot of interesting developments in the insect sector right now. This is a global industry that’s been growing in Europe, there’s been a lot of activity on there three kind of main species that get a lot of attention. That’s the mealworm different types of crickets and the black soldier fly. And there’s sort of two types of businesses. There’s insects as an animal feed and what you were just mentioning insects as a food ingredients. And certainly there’s some very exciting companies doing work to try to get insects into human diets directly. We’ve stayed away from that, because it’s still early in the US as far as that adoption.

But certainly, I see that as a big part of the future of food, which is exciting. That being said, there’s you know, there’s these three kind of core species that are being developed, but there’s a huge amount of possibility there are millions of species of insects on the world in the world. And they each have some really interesting potential value propositions we just haven’t really explored that opportunity in our food system or in our material handling. But I think that we’re going to continue to see other species come on the radar. I know some companies have been developing locusts. There’s been work around different types of fruit flies. We know there’s some really interesting high tech opportunities and solutions.

There’s some companies, for example, that grow the cabbage looper or type of butterfly for production of novel proteins. And so they actually are using this for almost a pharmaceutical use. So that’s, there’s just sort of this almost endless set of possibilities, once we start really exploring what the insights realm can give us. So it’s a pretty exciting time to be involved in industrial entomology.

Host Raj Daniels  15:35

Sounds like a fascinating time, I’m looking forward to seeing what other insects you know, what are the uses, we can actually derive from them? One of the things involved in animal husbandry is the amount of water that’s needed to, you know, raise animals raise agriculture, how does insect farming differ in that area?

Virginia Emery  15:54

Yeah, so it’s an interesting question, you know, we’re developing these new this new crop, we want to make sure that, as we’re developing it, the promise of the sustainability in particular is a true promise that we’re not just taking food from other animals to create our bugs that we’re not using a lot more water or energy, or resources to do this, it’s going to take time as we get more efficient to really see the true potential of insects in that regard. But right off the bat, one of the things that we like about the meal worm is that because it’s dry adapted, very little water is required to grow them. So they do require a humid environment.

So we have some needs there. To keep the conditions humid, we have some material handling needs to use water, you know, washing some of the substrates and the trays and things like that. But it’s extremely minimal to the point where we’re using a fraction of a percentage of the water that you would need to produce a comparable amount of soy protein, for example. So there’s a real opportunity, especially with the mealworm for some real water savings. And this is one of the reasons in the Middle East and other parts of the world where water is really a concern. We’re seeing a big interest in insect agriculture. And that’s because there’s an opportunity for a lot more resource efficiency.

Host Raj Daniels  17:20

Thank you. And you mentioned something earlier, you mentioned the beetle being a super bird superbugs, sorry. And its ability to eat in organic matter. And so two questions, one is given examples of inorganic matter, and what do they eat?

Virginia Emery  17:35

Yeah, so this is a really interesting, I guess, next frontier of what insects can do, they can actually break down things like plastic. So we had an early project a few years ago, working with Stanford University, on the ability of mealworms to digest polystyrene, also known as styrofoam. The only known way to biodegrade polystyrene is in the gut of a mealworm. And it’s just incredible that they can do this. These are extremely strong molecules that are difficult to break apart. And they happen to have some unique enzymes in their gut microbiota that allow them to break down these very hard to break down molecules. So there’s some really interesting work happening around their ability to break down plastics. I’m sure as we continue to test other types of molecules, we’ll start to see some real opportunities there. We have moved away from trying to commercialize that because of a huge amount of research that’s still required to make that commercially viable. But one of the things that we’re exploring right now is the ability of mealworms to break down mycotoxins so mycotoxins are residues left behind by mold and fungus and other microbes as the whatever the feedstock is become spoiled and they can be quite harmful. So mycotoxins are a major source of chronic and acute health issues for both animals and humans. And we regulate the amount of mycotoxin that’s in our animal feed for this reason.

It turns out that mealworms can actually break down those molecules. So we’ve looked at half dozen or so different types of mycotoxins, we have yet to find a dose of mycotoxin that is toxic to these insects, they can actually just break down that Mali molecule and eliminate it. So it’s not bio accumulated in their biomass. It’s also not found in their frass the frost is the insect manure, as your word of the day for us is insect poop. So we have a saying at beta hatch that frass happens. And even that press doesn’t contain any of these harmful toxins. So that amazing digestive ability of these insects is really part of their true potential in the food system, I think we’re going to continue to see some opportunities around what they can eat. So I think it’s it’s less a question of, you know, what are the limitations of, of what they can eat? and more, you know, it seems increasingly they can eat almost anything given the right conditions. So how do we best capture that opportunity for industrial production? That’s, that’s sort of the challenge is being able to scale this up in a way that makes commercial sense.

Host Raj Daniels  20:30

And what did they eat right now? What do you feed them.

Virginia Emery  20:32

So we use a range of agricultural and food manufacturing byproducts. There are some regulatory limitations of course, on what you can feed these insects because they’re intended to be part of the food system to feed other animals. And so we do have to be very careful about how we source the inputs for our farm. And so we’ve focused on byproducts and low grade feed ingredients. So some examples are things like dried distillers grains, which are byproducts of biofuel production. Right now we’re using one of the ingredients is Apple processing byproducts. So there’s the region that we’re in the Wenatchee Valley is known as the apple capital. And it has a huge amount of tree fruit production. And we have a good number of apple and fruit processors in our area, and they produce different types of wastes. And we’re able to use that in our insect growing process in a way that helps to recover those nutrients. So that’s the current feedstock is a component of grain based and fruit based diet.

Host Raj Daniels  21:40

So it sounds like a total closed loop system.

Virginia Emery  21:43

Yeah, there’s a lot of interesting efficiencies here, you know, the inputs are, mostly, you get this feed that’s coming in, that will then be converted into insect biomass and frass, we can sell pretty much everything that is produced, there’s virtually no waste, no physical waste that is produced in the process. We are looking for efficiencies in other parts of our system as well. So one of the exciting projects that we have at the flagship facility is funded through the clean tech, or sorry, the Clean Energy Fund of Washington State. And we have some support there to develop a waste heat reuse systems. So we’re taking waste heat from a data center, and using that to reduce our electrical needs at our facility. So taking something that is otherwise just vented into the atmosphere, in the winter, just melt snow in the summer, just yeah, we’ve got heat pumping out. And that’s energy that’s being wasted. And we’re able to recapture that waste and use it to reduce our electrical needs. And so some really innovative technology on that front that’s allowing us to even further enhance the sustainability of our systems.

Host Raj Daniels  22:58

Sounds really amazing there. You know, is there an opportunity in the future? Currently, we see grass fed, you know, not corn fed? Is there an opportunity in the future from a marketing standpoint to prefer farmers or people raising animals to practice differentiate using, you know, your feed?

Virginia Emery  23:15

Absolutely. There’s already a few brands in Europe that use that to their advantage. So poultry that are fed with insects, that’s something that directly goes on the label, and consumers love it. So I know that insect fed eggs is a huge product in the Netherlands. And we’re starting to see this consumer recognition that insects are a natural part of the diet. In speaking with the local egg producer, you know, they previously had a vegetarian fed label. And we’re getting calls from consumers that said, you know, what, chickens aren’t actually vegetarian, they eat bugs. And so I think that we are going to continue to see a growth from a consumer standpoint of interest in our products, that hopefully will help to continue to drive adoption, because it just makes sense. You know, in the wild fish, and birds would be eating insects, you know, you look at what are salmon eating, when they’re in the wild, it’s almost 100% bugs, especially when they’re at that smaller stage. And so we have these, it’s a sort of a natural part of the diet. And I think that there’s some real opportunities for us to work with brands and work with our customers to develop more consumer recognition of the value of insects as a feed ingredient.

Host Raj Daniels  24:32

I agree from a recognition standpoint and education standpoint, so I appreciate you sharing that. So, Virginia, the crux of our conversation is the why behind what you do what spurred you in this direction, you know, what caused you to stay with it? It’s not easy being an entrepreneur. So what’s your why what drives you?

Virginia Emery  24:48

Yeah, I you know, I’m, as I mentioned, sort of at the top of our conversation, I’ve always been a biologist and conservationist and an entomologist my whole career I’ve been working with insects And when you’re trained in entomology 99%, of what you do is figuring out how to kill bugs. Most of the jobs that are out there are around developing pesticides, managing the effects of pesticides, working with insects and thinking about them as these pests. And I think, you know, early on in my education, I really started questioning that narrative that insects are bad, because it’s there are certainly insects that do cause a lot of harm, we’re seeing a lot of damage, that can be done by insects. And that’s always been a challenge to our food production. But in our effort to manage that we’ve sort of tipped the balances the other way, we’re seeing that with, you know, the decline of honey bees and other pollinators, we’re seeing that with a lot of the challenges around pesticide production. And so I think, you know, the company was really started when I, for me from a vision and a desire to see insects reach their full potential in our food systems, and to really, you know, reach their full potential as a resource and not as a pest to really try to flip the conversation and start thinking about insects, and the roles that they play for us the unrecognized ecosystem services that they provide to us, especially around nutrient cycling. And just thinking about ways that we could use that to our advantage.

You know, I’m really driven by the challenges of climate change, trying to solve a lot of the challenges that we know are going to continue to emerge in food production. And one of the things that has really been driving our mission is looking to try to close the loop have have more regenerative agriculture, to be thinking about insects as a supply chain disruption to what we currently have, which can be a very linear production, where you go from the fields into an animal, so you grow soy, you feed that to an animal, all of that waste often just goes back into a landfill. And so there’s this, these missing links in our supply chain. And I think insects can really play a role there. So you know, I’m really motivated by the desire to see these technologies come to life to be developed to help help our species continue to thrive and to be successful on this planet, because I think it’s going to take a lot of creative solutions to solve the problems that we’re facing.

Host Raj Daniels  27:36

Well, I appreciate your motivation. And I love the idea the way you said it, the concept of the insects, full potential. That’s a beautiful phrase there. You know, what are some of the most you’d say, learning moments or aha moments you’ve had on your journey?

Virginia Emery  27:51

Yeah, it’s been an interesting transformation. For me, as an entrepreneur, you know, obviously, I was trained as a scientist, I have gone through that transformation from being a scientist to being an entrepreneur. And I think one of the interesting things that I’ve seen in that journey is a difference in how we communicate in these different disciplines. You know, when you’re a scientist, you are trained to use very cautious language, you know, things are never sorted, and there’s always room for, for you to be wrong. When you’re in business, they look for they being investors, customers, you know, the folks you’re engaging with, you’re looking for a lot more certainty, a lot more clarity and conviction around everything that you say. And so I’ve had to adapt my ways of speaking, and my ways of communicating to really moderate how I’ve been using some of that language, you know, not saying maybe, and well, you know, this could be different, you know, really trying to think in terms of my audience, and being able to communicate to both audiences is something that’s, I think, a real asset to beta hatch that but myself and all of our scientists are trained in how to communicate clearly to the business side of what we do. And all of our business development folks are also have to be really fluent on the science because it’s really an important marriage of these two areas. And I think that’s a lesson that, especially right now, you know, we’re recording this in the middle of a global pandemic. There’s a lot of challenges around communicating science to the public. And I think this is an area that we need to see a lot more transformation in how we train our scientists and also just how we train other public figures in how they’re communicating because I think that there’s sort of pros and cons for each of these different modes of communication and fortunately, just the way that science is structured has can lead to a certain amount of mistrust when you’re using that sort of cautionary language all the time. So that’s been one of the most interesting parts of my journey is really that transformation and communication and thinking from that science based discipline into the world of business.

Host Raj Daniels  30:17

That is really interesting, you know, the way we speak and the words we use, depending on the audiences, it’s almost like we have to be chameleon like, when we’re presenting, you mentioned, the science community and the venture community or the investment community, and their degree of certainty, perhaps required to the venture community, even though knowingly, and I’ve been in this space for a while myself. So I know that knowingly, we’re never really certain. And you mentioned this time right now. And this is the most uncertain time I think we’ve been in in a long time. So it must be, it must be a difficult or interesting challenge, to maintain that level of certainty, knowing inside that you can never be certain.

Virginia Emery  30:56

Yeah, I mean, I think when it comes back to it, none of us knows what the future is gonna hold. But I think that we can just sort of do the best that we can with the information that we have at the time. And the great thing about running a startup and being in a really dynamic high growth industry, having this fast growing company is that we are creating the future we want to see. And so even though we don’t have a lot of certainty around what the future will look like, that becomes a lot more clear as we deliver on our mission and vision that we’re creating that future. So it’s an interesting and exciting time to be in a startup because we have a lot more opportunity to form what that future looks like. And that’s one of the most thrilling parts of being part of a startup.

Host Raj Daniels  31:45

Well, I love the idea of creating a future we want to see. And before I get to my last question, I can’t leave you without asking, what are your favorite insects and not including your worm?

Virginia Emery  31:56

That’s a great question. I love social insects. My PhD work was in ants. And I just have a real fondness for all of the social insects that the wasps, the bees, the ants of the world. ants in particular are extremely fascinating. Their societies are almost all female. Most people might not realize this, but any of those who have an Austrian insects, the workers are all female. So you have these all female societies that are extremely complex. across the different types of ant species, you have huge, interesting differences and behaviors. You can have colonies that are just a couple dozen workers up through colonies that have millions of workers. So it’s just a fascinating world of biology. And the more that you learn, the more you want to learn. Now I have a really funny example. You know, speaking of you mentioned, your daughter was really into entomology, I did a lot of science education across my career and working with kids, and just you tell them, these things about insects, and they’re so just intrigued, like, for example, the oldest known insect is a an ant, there are these leafcutter ants that live in the tropics. And they have one queen in the colony. And so as long as that colony is alive, you know that the queen is alive. And they have been tracking some of these colonies for decades, we have ants that are 4050 years old, those queens that continue to produce new new workers every year and are continuing to thrive. And so it’s just incredible that you get these lawn living insects with extremely complex behaviors. And it’s by far my favorite type of insects, for sure. 

Host Raj Daniels  33:53

You know, I recently heard the story about, I think Red Ants from South America, and the way they knit together to survive flooding. And they essentially float on the water until the water, you know, subsides and then they land back land back on the land, and how those red ants essentially made their way to the United States. I think I heard correctly Alabama, some, you know, part of the United States like that, and then set up colonies here, but they weren’t native to here, but they came across on water. 

Virginia Emery  34:22

Yeah, yeah, the fire ants do this really cool rafting behavior. Oh, man. We can do a whole other podcast just on the ants. The stories I could tell you, you know, just about I did a lot of fieldwork in the tropics, and got to see a lot of these different types of insects and ants in particular, you know, the, one of the fastest moving biological things we’ve ever measured is the attract jaw aunt whose mandibles move at incredible speed we’ve got the most painful insect sting is an ants the bullet ants. Where it’s called the bullet app because it feels like you’ve been shot. That’s how painful it is, you’ve got just this incredible, rich, natural history of, of insects, ants in particular. I mean, I think it’s a world that the average person doesn’t get a lot of exposure to. But, you know, I hope that we can be inspiring by, you know, helping to show the value of insects, especially in our food systems, you know, that we can be starting to inspire more people to be thinking about insects a little bit differently, and to start digging into some of these really cool stories that they have to tell us and the life history of these, these insects, I think we can find a lot of interesting inspiration and, you know, also just some real value in terms of, you know, antimicrobials, and the ability to break down toxins, as we mentioned, you know, there’s these things that they do that we can leverage to, to our benefit. On top of just providing this incredible diversity and keeping the worlds and the inner ecosystems functioning well.

Host Raj Daniels  36:06

Well, yes, Cory is definitely been inspiring. And I’ll be sharing it with my daughter, before we go. My last question is, if you could share some advice, or words of wisdom with the audience, what would it be?

Virginia Emery  36:16

I think right now, I would just encourage everyone who’s listening to really think about what their passions are, and, and find ways to pursue them. You know, when I was in school and thinking about a career in biology, you know, I think, in starting this business, I’ve been able to find my passion, and that has continued to fuel me through infestations, through floods through huge upheavals, in our business through personal and professional challenges, you know, the, the passion that I have for what we are doing, has continued to drive and motivate me, and so I would just encourage anyone who is, you know, trying to find that, I think when you have that meaning in life, in in your career, you can really accomplish some incredible things. And so I think, you know, for me, my life’s work and insects is something that will continue to be driving and motivating me. And I just hope that your listeners can find a similar passion. Now, they call me the bug lady, and I wear that badge proudly, because, you know, I just love what I do. And when you love what you do, you’ll never work a day in your life. And so that that’s the, I guess, words of wisdom that I would leave you with.

Host Raj Daniels  37:35

Thank you so much for that. Virginia, this has been a great conversation. Is there anything that we have not explored, that you’d like to share? Or talk about before we go?

Virginia Emery  37:45

I think I would encourage your listeners to look into the insect industry, you know, folks like your daughter, who are exploring careers in the sector, investors and other partners in your realm of construction. And I think there’s a lot of opportunity in the insect sector that is not visible to many people that really, this is a time for us to be thinking about. Basically, making our supply chains making our food system making, making things new. And I don’t mean that in you know, this is I think there’s a moment of transformation in our, in our world. And I think there’s a lot of opportunity in our sector. So I would just encourage all your listeners to take a look at this incredible world of insects and look at the insect sector, look at the work that beta hatches doing. And think about if there’s a way that you know, this can help to inspire you or, you know, bring you some new direction in your ventures.

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