I want to give my thoughts on production amounts and how it ties to commercial success.
There has been this false benchmark that "metric tonnes" is needed for success or proof of concept. While i'm sure Kraig Labs is going to get there very soon, it is not necessary to have many metric tonnes to sustain a revenue stream for this company.
We've talked about "pivots" in this industry before. Most notably Bolt Threads "pivoting" away from fibers and going towards mushroom leather. Or, Spiber, Inc. pivoting away from "spider silk" proteins towards "brewed proteins". Well, Kraig Labs has "pivoted" as well. They did that a year ago when they signed this contract with the Kings Group.
The original plan was to sell B2B. Kraig Labs was going to sell their fibers/fabrics to large apparel companies and likely by the tonne. I think a solid price per tonne would have been $250k-$300k. For an incredible product like spider silk, and being in it's infancy, the demand would be high enough to support those (and even higher) prices.
But Kraig Labs pivoted. And there's evidence of that in their PR today. Jon says "Our partnership with Kings and the Spydasilk brand gives us a very exciting direct-to-consumer sales channel,". The company has decided not to leave the massive amounts of money on the table by just selling fabric, but now selling direct to consumer products where the margins are much higher.
Let's do a thought experiment with an example that most of us are familiar with:
Bolt Threads launched their 50 neck ties made from a spider silk analogue. They sold out immediately. Their CEO claimed that each tie contained 50-60 grams of their analogue silk. They sold each tie (direct-to-consumer) for $314.15 a piece (almost assuredly at a loss for them due to the enormous expense of protein production). Well, if your product weighs 60 grams, that means 1 metric tonne of fiber could make more than 16,000 of those ties. If you sold 16,000 of those ties for $314.15 each, that single metric tonne of silk would generate over $5 million in sales. That is a HUGE difference than just a contract to sell spider silk by the tonne. Kim realized this and pivoted to a direct to consumer model where his spider silk will generate 10-20 times more sales than just fabric. Even splitting the revs in half with Kings would generate $2.5 million per tonne for Kraig Labs. This is just one example. These ties weren't even directed at the luxury consumer demographic.
You can easily see now why Kim pivoted to this model. $314 for a tie made out of an incredible and novel material that hardly anyone has might even be on the cheap end. Hell, I have Egyptian cotton sheets that cost me almost $500, and that's not new or very rare at all.
