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Oh, I am excited about this IPO, because it is so unlike the others we have looked at so far! It's not a tech. It's not an energy. It's not a bank. It's a food company that is paving the way to meat alternatives. Here are our thoughts on Beyond Meat!
Beyond Meat was founded in 2009 by Ethan Brown and is currently headquartered in El Segundo, California. It is a producer of plant based - meat substitutes that use ingredients like Pea Protein isolates, coconut oil, carrot fiber, and other plants to create mimic chicken, beef, and sausage. Beyond Meat products are now sold in over 33,000 stores, restaurants, hotels, you name it! They have also expanded internationally and are sold in the United States, Canada, Italy, the United Kingdom, and Isreal. I would say they are doing pretty well in that regard!
Personal opinions aside, the wave of vegan and vegetarian lifestyles is rising whether the reasoning is animal welfare, environmental concerns, personal health or all three. According to Forbes the around 5% of the US is vegetarian and 3% say they are vegan. While these seem like small amounts, remember 8% of the US population is still around 26 million people (Forbes). As Jerremy says, the market rewards the specialist. These are 26 million people that are specifically looking for tasty vegan / vegetarian food. Currently, Beyond Meat sells their products for between $5 and $10 for either 2 large "burgers" or a pack of "chicken strips".
I won't deny, that is definitely pricey, but these products are not something you can make at home. And the demographics that eat these products are more than willing to pay these prices often because, well, it's a diet/way of life. Market Watch sums up, "Beyond Meat has successfully grown its revenue over the years, but has yet to produce a profit. In the first nine months of 2018, the company generated revenue of $56.4 million, more than double the $21.1 million posted in the year-earlier period, and more than the $32.6 million posted for all of 2017. But its net loss in the nine-month period came to $22.4 million, only slightly less than the $23.4 million loss posted in the year-earlier period. The company’s loss for 2017 came to $30.4 million, wider than the $24.1 million loss posted in 2016." As they grow, losses will occur, but I am hopeful they will slowly be able to start closing this gap as their food production efficiency increases and they enter into new markets.
As far as competitors, Beyond Meat has two main competitors; other plant based products, and actual meat. While I don't believe that Beyond Meat is actively trying to push people into switching to vegetarianism/veganism, I believe that they have definitely perfected the product that most mimics the taste and feel of meat. Their formula, recipe, whatever you want to call it is being raved about how closely it resembles actual meat that is actually hard to differentiate between the two. Matt Bittman, a food journalist with The New York Times, wrote that "you won't know the difference between that [Beyond Meat] and chicken. I didn't, at least, and this is the kind of thing I do for a living." Rhett and Link of Good Mythical Morning, with over 15 million Youtube subscribers recently did a competition taste test between several of the most known Plant Based burgers and were amazed at the taste of the Beyond Meat Burger. If you are wanting a laugh, watch their review of Beyond Meat click here! Beyond Meat products have almost the same amount of protein and nutritional values of the actual meat they are mimicking! Also, Carl's Jr and Del Taco have started offering Beyond Meat Burger and Tacos on their menus in California!
Beyond Meat is expected to hit the market tomorrow, Wednesday, April 30. They are expected to offer 9.63 million shares which was raised from 8.75 million they announced earlier. Currently it is expected to IPO between $23 and $25 per share. I personally think this company is pretty amazing as they continue to butt their way into mainstream offerings. As more and more people subscribe to the vegetarian and vegan lifestyle I see companies like this growing!
Thanks for reading my friends! I hope you enjoyed learning :) Stay epic!
- Ashley Allen