“What we failed to see at first is that ‘basically dog food’ is the flavor people have been waiting for,” said Barclays Chief Analyst Duke Redstone. “Now we have a much more bullish outlook in the meat alternative industry knowing that customers are demanding products that taste like Purina.”
Beyond Meat (BYND) has surprised the investing world since their IPO in 2019, surging more than 300% in the first few months of its offering. Many institutional investors were caught flat-footed when the demand for the product blew through even the most optimistic expectations. And that demand growth shows no signs of stopping. Beyond saw a 5x YOY revenue growth in 2020.
What baffles investors the most is the surging demand of a product whose flavor can best be described as “what I would give to that shelter dog.”
“When I first tried it, I described it as ‘spam and rubber erasers had a baby, and it is ugly,’” said St. Louis based Beyond Meat convert Jennie Harrison. “Then, when I read about how it basically contained everything the body needed, almost like a puppy chow, but for humans, I was immediately on board.”
The meat alternative industry has been around since the early 1970s and was launched on the backs of vegetarian and vegan consumers looking for alternatives to traditional meat-based staples like hamburgers, hot dogs, and chicken nuggets.
It is well known fact that vegetarians and vegans hate the taste of good food, so it was not surprising when this small population adopted Beyond Meat’s offerings. What was surprising was the number of omnivorous consumers that also choked down the highly processed clay patties and could not wait to get their hands on more.
“I eat it because it’s healthy,” said Jason Goulds, a 22-year-old nutrition major at St. Mary’s University. “I mean it’s vegan right? And vegan means healthy. Healthy food isn’t supposed to taste good.”
That logic seems to be the prevailing force driving the demand. Simply put, “if it tastes this bad, it must really be good for you.” Whether the rally continues is anyone’s guess, but early investors are happy they took a chance on a product that many who respect their taste buds would have written off years ago.