A crowd gathered one morning over the summer outside a Kentucky Fried Chicken in Atlanta, lining up around the block to be the first to try the new plant-based nuggets and wings KFC was testing from new food supplier Beyond Meat. Within hours, KFC was sold out.
But such non-meat nuggets are not just a KFC sensation. Beyond Meat's plant-based burgers, breakfast sausages, brats, and other products can be found at a growing list of brand-name food retailers from Whole Foods to Dunkin' Donuts to Tim Hortons to Carl's Jr. McDonald's is the latest fast-food chain to announce it would test Beyond Meat burgers in some restaurants in Canada over a 12-week period starting September 30.
The visionary driving the product is Ethan Brown, a meat-loving, tech-minded entrepreneur turned vegan who wanted to create meat from plants that were so tasty and textured and palatable that consumers wouldn't know the difference.
Entrepreneurs see something and they'll do whatever they can to make it happen.
"Bit by bit we're building meat from plants and as we do it we just can't do it quickly enough for consumers," Brown told Client Focus in an interview shortly after the KFC launch in Atlanta. "We've been blessed to tap into a movement that's so much bigger than our brand."
The message is also impressing Wall Street. After its IPO in May, Beyond Meat shares gained 543% by the end of June—making it the best-performing public offering during the second quarter. On July 31 a follow-on offering of shares was sold at 6 times the IPO price, delivering a market valuation near $10 billion.
William Blair was an underwriter on the IPO and its follow-on offering this summer.
Early investors saw Brown's potential for an alternative to the trillion-dollar animal meat market starting a decade ago. Bill Gates, Leonardo DiCaprio, venture capital firm Kleiner Perkins, the Humane Society, and others were early backers of the company.
Beyond Meat's annual sales now have taken off—from $16.2 million (2016) to $32.6 million (2017) to $87.9 million (2018). Its products are now featured in more than 53,000 locations worldwide.
"Ethan and Beyond Meat have created an enterprise with the potential to create truly distinctive and game-changing financial and societal benefits," says William Blair analyst Jon Andersen, who covers the consumer products sector.
A menu with a winning message
Brown sees meat without animals as a win-win for consumers and the planet. The company's core message is that a large-scale shift from animal protein to plant-based protein will not only benefit human health and animal welfare but also tackle climate change. It takes less water, land, and energy to produce a Beyond Burger compared to a traditional beef burger.
Brown brings global concerns to the company's mission. But he also has a laser focus on product quality that a meat lover could appreciate. He is obsessed with making his products as tasty, textured, and nutritious as everything now offered in a retailer's meat case.
"I love meat and still do. As a kid my favorite burger was a Double R Burger from Roy Rogers with the ham on it, the burger, and the cheese."
But growing up, Brown also developed an affinity for animals, being around them during summers on a family Holstein dairy farm in Maryland. He developed the same affinity for climate concerns. After graduating from college he worked in clean tech within the energy and transportation sector, always socially minded. But for Brown it wasn't enough.
"I started looking around and thinking that maybe I wasn't working on the most impactful thing to improve the climate," he says. "We only have so much time on earth and so many years to make a really strong contribution. After a while it becomes very hard to ignore that."
Reflecting on his roots, Brown took a long look at the stress that modern animal agriculture has on climate and natural resources. The livestock sector accounts for an estimated 18% of global greenhouse emissions, according to a UN 2013 report. Animal fats are also tied to obesity and heart disease. He decided that changing out the protein at the center of the dinner plate could address several societal problems all at once.
Today, he notes, there are over 7 billion people in the world—but more than 100 billion food industry animals.
"The ratio of people to livestock is one that planet Earth can't support," Brown says. "We have to figure out a way to enable people to continue to eat meat. As humans that's what we do. We consume animal protein. The question is: how can we consume meat in the form of plant protein? That's what we're really after as a company."
"All that started to weigh on me and called me to make a change in my life."
"Passion takes you a long way"
Still working in clean tech, Brown, after his young kids went to bed, began searching the internet to learn more about meat. He discovered two scientists at the University of Missouri who were taking protein from plants and reorganizing it into the structure of muscle. He began working with them and researchers at the University of Maryland near his Washington, D.C. home to develop and license a process that eventually became the foundation technology for Beyond Meat.
About the same time, Brown started a business importing a textured soy protein from Asia that was close to muscle and selling it to Whole Foods stores in the Mid-Atlantic market.
The ratio of people to livestock is one that planet Earth can't support.
By 2009, Brown had left the clean tech company where he worked for 10 years and launched Beyond Meat. There were a lot of days when success wasn't clear or evident, he recalls.
"It takes a lot of sacrifice, pain and discomfort, but most things that are worth it do," Brown says. "For me, there was no safety net. I had a family, kids. So you do whatever it takes to make it successful. Entrepreneurs see something and they'll do whatever they can to make it happen."
His favorite item now is the company's new breakfast sausage. Brown sees every single use of the company's products as a step in the right direction, paving the road to a future of meat without animals as consumers try it and like it.
More competitive pricing for Beyond Meat items is a top goal, he adds.
"We believe this is key to truly changing the protein market. Imagine if we can deliver on taste, on nutrition, and then finally on price," Brown says. "Getting there as quick as we can is going to be the challenge."