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Beyond Meat raises $241 mn amid growing appetite for vegan food
NEW YORK, May 2, 2019 (BSS/AFP) – Vegan burger upstart Beyond Meat, whose
backers include Hollywood star Leonardo DiCaprio and Microsoft founder Bill
Gates, has raised $241 million from its initial public offering, valuing the
firm at about $1.5 billion as it surfs a wave of flexitarianism.
The California-based firm said it sold 9.625 million shares on the Nasdaq
exchange at $25 each on Wednesday, at the top of its offer range. Reflecting
strong investor demand, it had increased the offer price of its shares to
$23-25 from $19-21.
The company has tapped into changing consumer appetites as growing numbers
of people turn to plant-based meat alternatives, whether vegans who shun all
animal products or flexitarians, who advocate moderate consumption of meat.
“We believe that consumer awareness of the perceived negative health,
environmental and animal-welfare impacts of animal-based meat consumption has
resulted in a surge in demand for viable plant-based protein alternatives,”
it said in its prospectus.
The firm said it believed eating plant-based protein would “help address
concerns related to human health, climate change, resource conservation and
animal welfare” as it seeks to compete with the $1.4 trillion global meat
industry.
Despite the popularity of its signature Beyond Burger and other products,
Beyond Meat is still not profitable and recorded a net loss of $30 million in
2018, according to its most recent financial records released Monday.
But it has seen strong growth, with $88 million in sales in 2018, compared
with $33 million in 2017 and $16 million in 2016.
“We have a history of losses, and we may be unable to achieve or sustain
profitability,” the firm cautioned in its filing with the Securities and
Exchange Commission.
The group said it would use the funds raised to “expand our marketing
channels, invest in our distribution and manufacturing facilities, hire
additional employees and enhance our technology and production capabilities.”
Like fellow “veggie burger” maker Impossible Foods, Beyond Meat uses
sophisticated technologies to replicate as closely as possible the taste,
color, smell and texture of meat.
It uses peas, beans and soy to make steaks and sausages or replace minced
meat in tacos and spaghetti bolognese.
The firm’s popular Beyond Burger, which uses beets to make it ‘bleed’, is
sold in thousands of supermarkets and restaurants, including TGI Fridays.
Beyond’s rival Impossible, meanwhile, has linked up with Burger King to
offer a vegan version of its signature Whopper. Nestle and Unilever are also
aiming to expand their presence in the expanding sector.
Beside Gates and DiCaprio, its early backers include Twitter co-founders
Biz Stone and Evan Williams, former McDonald’s director Don Thompson, meat
giant Tyson Foods and the Humane Society.
BSS/AFP/HR/1325