Cultivated meat firm Upside Foods has cut its workforce as the industry continues to struggle with bans from legislators and a significant downturn in venture capital funding. In an email sent to employees, Upside CEO Uma Valeti wrote that 26 people would leave the company and that executive and leadership teams would be restructured to “reduce top-heavy structures.”

“Our focus must now narrow to a tighter set of priorities that pave the way for our product launches in the next two years,” Valeti wrote in the email seen by WIRED. “We need to deliver on the work that remains, especially on critical milestones that are yet to be hit or are delayed.”

Upside is among the best-funded startups in the cultivated meat industry, and one of only two firms that is cleared to sell its product in the US. In February, WIRED revealed that the startup had put on hold its plans to build a large cultivated-meat plant in Illinois and made “selective role eliminations” and “other changes” that would impact 16 employees.

In the most recent email, Valeti wrote that the company was pausing its “large-scale tissue program.” The company started selling its whole-cut chicken in July 2023 at Bar Crenn restaurant in San Francisco, but since this initial launch Upside has indicated that instead of whole-textured tissue, it is focusing its scaling efforts on so-called “suspension” products, more suited to producing chicken nuggets, patés, and other ground-meat products.

In the email Valeti also called out the difficulties currently facing his industry. “Uncertainty related to political, regulatory and macroeconomic headwinds requires us to be even more deliberate and conscious with our focus and resources,” he wrote. In May, Florida and Alabama passed laws that banned the sale of cultivated meat in those states.

“Upside is focused on our next chapter of scale and commercialization. To stay agile in the face of an uncertain macroeconomic environment and preserve the resources needed to reach our milestones, we made the difficult decision to eliminate a number of positions,” said interim head of communications Melissa Musiker in a statement to WIRED. “We’re deeply grateful for the hard work, commitment, and dedication of our departing team members and remain steadfast in our mission to bring cultivated meat to the world.”

On June 27, a few days before Florida’s ban came into force, Upside hosted a public tasting of its chicken in Miami. Outside the event, a mobile billboard protesting against cultivated meat directed people to a website backed by the Center for Environment and Welfare—a group linked to public relations firm Berman and Company, which has a long history of supporting nonprofits that defend the interests of the food and drink industry.

Steve Molino, an investor at Clear Current Capital, a sustainable-food venture capital firm that isn’t invested in Upside, says that it was a good sign that Upside was adjusting its strategy to account for these headwinds. “Too often we see companies wait until it’s too late to make difficult changes,” he says.