The Verticals, both old and new
The Verticals series will help you consider new opportunities emerging from engineering biology
How do you break apart an economy, a society, its cultures, and its environments? How do you analyse the impact of changing humanity’s feedstock? This is the role of The Verticals, a series of deep dives on different categories of impact arising from advances in synthetic biology.
A few months ago I sat in the audience at Australia’s Parliament House and listened to the Minister for Industry and Science, the Honorable Ed Husic. He opened a synthetic biology event hosted by Science and Technology Australia. Minister Husic quoted the Boston Consulting Group and Hello Tomorrow figure of the decade. Those familiar with its placement in political speeches can smell it on the typewriters of political advisors tasked with drafting engineering biology swan songs.
The figure goes something like this, $30 trillion of economic displacement will be caused by engineering biology across the coming 30 years. This is billed as a 40% displacement of global GDP. It comes from page 5 of BCG’s Nature Co-Design report, and as always, context is king. I've ripped this figure before, we all do when we have a point to make. The real issue, however, is that the figure could be too low.
The total investment raised by alt-protein companies this year is already $899 million, according to Better Bioeconomy. That’s not the entire alternative foods vertical, just proteins. Fuels, medicine and chemicals aren’t here either, let alone the more exotic verticals of computing, sensing, defence and space. BCG’s forecast could prove to be conservative. Growth of 4-8% p.a. results in generationally transformative changes to living standards. What would a 40% displacement of the global economy feel like to live through?1 We may soon find out.
It's not news that the linear model of consumption is giving way to a circular economy. Sunlight is food, waste is feedstock, and nothing happens without water. What is often missed in the circular economy story is the centrality of biomass. It’s time to look at the economy as a microbiologist looks at organelles.
How do we wrap human civilisation around principles of nature co-design and grow the organelles of a sustainable bioeconomy?
Energy, food, beverages, materials, chemicals, medicine, information, technology, services, and… biomass. The verticals are built from the bricks of life and building better biomass has spillover consequences for everything.
My intent is to hierarchically break down these verticals into their constituent parts, and by pulling them apart, test the hypothesis that BCG may have projected engineering biology’s economic displacement below baseline.
Patrick Hsu recently said to Eric Topol, “15 years ago, we didn't have the modern transformer that launched the current AI revolution, CRISPR technology, single-cell, mRNA technology or broadly addressable LNPs [Lipid Nanoparticles].”
It wasn’t that long ago that oil was harvested from whales, most of the world’s combustion came from wood, and our capacity to move across the planet was constrained by horsepower, the wind and ocean currents. The new verticals are our opportunity to transition from living on borrowed sunlight to a mature system of carbon cycling. We can already see that the economic objective of organising carbon is slowly, ever so slowly, being elevated above those economic actions that disorganise carbon.
This is displacement at work, and it is accelerating because our AI-enabled toolset took a massive upgrade. Today’s engineering biology full-stack simply did not exist a decade ago. The technology, information and services verticals of engineering biology have evolved. We are watching cyber-biological convergence writ large.
Discussion of these new verticals sometimes gets bogged down in an us-versus-them mentality. The oil and gas verticals are demonised, aviation is labelled as too slow to transition, and we all chatter about how there is simply too much beef and concrete. Engineering biology is a middle way to find a path through these historical debates. The Verticals is written as an acknowledgement that every sector is needed and must be part of the transition.
Legacy aviation and marine assets have embedded carbon in their front-of-life manufacturing. We could prolong the working lives of these assets through drop-in fuels to amortise carbon costs. Some of these asset classes may never transition from liquid fuels, and why should they if we can learn to grow carbon negative molecule-for-molecule alternatives.2
Gigatonne-scale engineering expertise is primarily concentrated in legacy extractive industries. Industries built on linear carbon cycles need pathways to circularity and roadmaps from carbon neutrality to negative offtake. A global transition to a carbon negative economy without oil and gas is a tall order. Space elevators are only a slightly taller order. The opportunity presented in turning these oil tankers of foundational energy extraction into carbon capture leviathans should fascinate us all.
The beauty of the transition is that it doesn't need to occur in one giant moonshot. The style and grace of the verticals are that each chips away at a few basis points of global carbon emissions, one year, one company, and one project at a time. As the old saying goes, how do you eat an elephant? With a critically engaged techno-positive attitude and a healthy dose of political skepticism.
The so called ‘chip shots’ matter. There's a beautiful line in a 2004 report on semiconductors that identifies 80% of the semiconductor compound annual growth rate comes from chip shots. To repeat, 8/10ths of Moore's Law comes from incremental improvements in system-level performance. This shouldn't really be surprising. It’s efficient performance acceleration diversified across a large range of design factors. These numerous small improvements across the overall design space add up, but they also engineer redundancy into the productivity cycle. If one component caps out in performance or reaches its physical peak of potential, other component optimisations continue to meaningfully increase performance at the system-level.
We need to think about the circular economy in the same way. 80% of carbon efficiencies will likely come from minor design space optimisations across the combined system-level of all verticals. Instead of building single gigatonne-scale facilities that could burn down, be hit by meteorites or attract missile targeting in war, let's optimise every vertical at the micro level.
This is where the true promise of engineering biology emerges because life loves evolving minor design optimisations that provide competitive advantages across environmental variables. Right now many of these variables are in deep need of carbon lifecycle optimisation. Accurately understanding the verticals has never been more important.
The Verticals series is designed to help you categorise the techno-economic changes underway and prompt you to find new opportunities amid the mirage of challenges we face.
This essay was posted at 8am Hong Kong Time on Tuesday, 12th November 2024, in honour of Eshan Samaranayake, Founder and Author of Better Bioeconomy, who took the risk of following me before I had even written a word.
All images made using DALL·E, prompts available on request.
When I think of the BCG projection I like to ask, where are all the typists and the human computers? We’ve formalised the world, programatically broken it apart, and only now are we beginning to realise the exchange. What does the displacement of 40% of the economy feel like to live through? I’d imagine it will be traumatic for most, and Alvin Toffler’s Future Shock comes to mind. The signs of civilisational stress and cultural trauma are there if you look closely. How we transition is just as important as ensuring we do transition.
The biologically derived versions of liquid fuels are often purer, burn cleaner, and therefore offer better performance. Products that come from a hole in the ground occasionally come with a light dusting of grit that can get all up in that grill over the course of an asset’s lifecycle.