Beyond meat - X post from NPI

Just heard a great MF podcast on this potential IPO in the next 2 months.…

Jason Moser and Asit Baxi discuss BYND’s S1 filing over the first 23 min:

The following is a summary:

  1. Company already sells in many grocers like Kroger, Safeway, Wegmans and restaurants like TGIF and chains like Hyatt, Hilton
  2. Company not just targeting vegetarians. They want to be in the meat isle next to burgers. Apparently they taste like it as well. Have not tried it. They have 40 scientists, techs, chefs who scientifically put the food together to look and taste like meat using plant based amino acids, lipids etc. Company data shows 92% of people who bought this in grocers also bought animal protein. So not a niche market.
  3. They say the whole 1.5 Trillion meat industry as their market. Even 10% of this huge
  4. Great brand name, beyond sausage, beyond pork and so on
  5. Lots of big food companies competing like Cargill, JBS foods, Tyson, Hormel, WH groups and smaller brands like Boca, Impossible foods.
  6. Company is growing like crazy 91% rate from 2015 to 2017. And 167% for first 9 months. Of course very small base. They had rev. of $56M in the first 9 months.
  7. Has excellent backers like the Honestea founder Seth Goldman and some Twitter guys. Excellent mgmt. Here is his interview…

  1. Negative cash flow. They burnt 25M in 9 months and have 40M working capital. They have 17% gross margins and improving.
  2. Big risk is they have 1 supplier for their pea protein. They need to find more as they get bigger.
  3. Healthy eating trend is only going to grow. I think this is not a fad. Should be an interesting IPO to watch for.

I haven’t heard today’s Industry Focus yet, Texmex, but I’m definitely looking forward to hearing their take on this business. A little while back there was a “contest” for TMF Farm Teamers, such as myself, to pitch company recommendations to the TMF Analyst teams and I decided to go the “Rule Breaker” route, since it’s not yet public, and pitch Beyond Meat. Disclosure: I am a born-and-raised vegetarian who now mostly eats vegan.

Recommendation: Beyond Meat (BYND)

I’m going with a Rule Breaker approach to my Farm Team pitch in recommending plant-based protein company, Beyond Meat. Beyond Meat makes vegan, plant-based meat-substitutes, including Burgers, Sausages, Chicken-style Strips, and Beef-style crumbles. As of this report, however, you cannot invest in Beyond Meat as the company has only just recently filed for its IPO and applied to be traded on the Nasdaq. I am Breaking the Rules, a bit, in pitching a business which is currently private, as of today, Nov. 26, 2018, though this company should be available for public investment within the coming months. The opportunity available to this company, however, is too great for me to ignore and even should this IPO never reach fulfillment, I wanted to try and get this company on The Motley Fool’s, and my fellow Farm Teamers’, watch lists.

The Opportunity of non-animal protein

According to a 2017 report by research firm Global Data, the number of American consumers who identify as vegan had risen 500% since 2014 to 6% of consumers. Additionally, in Germany, 44% of consumers follow a “low-meat diet” which was up from 26% in 2014. According to Fast Company, a recent poll found that 43% of consumers are more likely to try plant-based alternatives than five years ago. The rise in global awareness of the health, ethical, and ecological impacts of animal-protein farming and consumption has led to a boom in vegetarian and vegan food options. Major chain-restaurants such as White Castle and Taco Bell advertise the vegetarian and vegan options their restaurants offer. Established food producers have been making large investments in animal-product-free food companies such as Canada’s Maple Leaf Foods which, in 2017, acquired Massachusetts-based Lightlife Foods and Seattle-based Field Roast Grain Meat Co. for $140 million and $120 million respectively, Daiya Foods was acquired by Japan’s Otsuka Pharmaceutical for $405 million, and Sweet Earth Foods was acquired by Nestlé just to name a few of the largest names. According to Allied Market Research, the shelf-stable segment of the plant-based-meat market is projected to grow over 9.1% annually through to 2025 and the most well-known food producers are making their moves to capture their part of the burgeoning plant-based food market.

Since its founding in 2009 Beyond Meat has made a name for itself in the plant-based protein market and its upcoming IPO indicates the company is working to position itself to ramp-up its growth-prospects. Its products can already be found in 50 countries, Amazon Fresh and 20,000 other grocery retailers including Whole Foods, and over 10,000 restaurants, hotels, and universities, the largest among them being TGI Fridays. The company recently announced the additions of Twitter CFO Ned Segal and Coca-Cola CFO Kathy Waller to its board and the company already boasts investments from Bill Gates, Leonardo DiCaprio, former McDonald’s CEO Don Thompson, and Tyson Foods. This month Time Magazine announced the company’s Beyond Sausage product as one of its “Best Inventions of 2018.” Beyond Meat also recently revealed a 26,000 sq. ft research facility in El Segundo, CA where the company researches how it can create new, innovative products which mimic meat in look, feel, and taste. This is not a company sitting on its laurels and looking to ride the wave of growth in its industry, it is taking the necessary steps to be a leader today and for the future.

Financials: a work-in-progress

In Beyond Meat’s S-1 filing, the company reports revenue of $41.6 million in the first nine months of fiscal-year 2018, a 167% increase from the first nine months of fiscal-year 2017, and trailing-twelve months’ revenue of $67.9 million. Revenue increased 101.3% from $16.1 million in 2016 to $32.6 million in 2017. In a plant-based meat-alternative market which saw sales reach $670 million, up 24% from the previous year, Beyond Meat is already one of the larger name brands. The company does not currently generate a profit as both operating income and net income are negative. It will be important to monitor how the company uses the proceeds from its IPO, initially proposed at $100 million but subject to change as it navigates the IPO process. Per the S-1 filing the proceeds will be used to upgrade and expand manufacturing facilities, expand research and development and sales and marketing. If used wisely each of these investments in its own business should help to grow revenue and help the company reach profitability.


While Beyond Meat has risen to a grab a significant share of the plant-based protein market its refrigerated and frozen products are not without competitors. Privately owned Loma Linda Foods may be the oldest with its founding in 1890 but its offerings primarily consist of non-perishable canned goods. Tofurky is likely the most well-known competitor and directly competes with its own line of vegan-sausages. Impossible Foods makes the Impossible Burger which is the most direct competitor to Beyond Meat’s Beyond Burger. Many competitors are owned by large, publicly traded companies such as Morningstar Farms, owned by Kellogg, as well as the brands named earlier in this report. While competition is fierce at this early-growth stage of the industry, there is room for many different companies to succeed. Each company in this space has its own niche and the success of individual products bring additional awareness to market as a whole and ultimately benefits the group. A consumer who tries and likes Beyond Meat’s Beyond Burger is also likely to try and potentially buy Tofurky sandwich slices, Field Roast’s Frankfurters, and Sweet Earth’s frozen burritos and bowls.

Bottom Line

Beyond Meat is a large player in a fast-growing industry, veganism is an established diet and has a long history in many parts of the world, but in much of the West it remains a small, but fast-growing trend. Post-IPO Beyond Meat stands to be a rare pure-play business into the plant-based meat-alternative market. I think this company is worthy of a position in the growth allocation of any long-term-focused investor’s portfolio.

Fool One Home Fool


Good one Jeremy.
I have been reading up on the S1 to better understand the “processed food” issue that Denny at NPI brought up.

  1. They are going after the $270B in US ($1.4T world wide) meat industry. Their case is that non-dairy milk has captured 13% of the dairy market and is now a $2B industry. If plant based meats achieve the same 13% success they are looking at a $35B market in US which is 50x the current market of $670 M. Non-dairy milk is processed and more expensive but that has not stopped its growth.…

  1. From the S1
    The WHO has since added processed meats such as hot dogs, ham, bacon and sausage to its Group 1 category of carcinogens.
    People still eat them

  2. Here is another article addressing the processed issue…

In a prior interview with Food & Wine, Beyond Meat CEO Ethan Brown also addressed the processed nature of his company’s burger. Yes, it’s processed, he acknowledges—but it’s still way, way better than industrial meat.
“We could go meet the farmer that grew your peas. We can show you how the protein was separated,” he says. “We could also go see the farmer that raised the cow you consumed, and go see that slaughterhouse. You can’t tell me that process is better than our process.”.

It is soy, gluten, GMO free. Industrially farmed cows are often fed antibiotics. But people still eat it. So, I don’t think being processed is a major negative against this company. For this company to grow 10-20x it has to produce something that smells and tastes like meat and is not much more pricey.

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Coincidentally I saw five ads last night in 45 minutes touting the Beyond Meat burger now being sold at the Wendy’s chain.

This article noted its arrival at A&W in Canada. It has become so popular that it sells out.

Will be interesting to see how the IPO works out. I might consider a small purchase to keep me interested.

I am not vegan but definitely want to try the burger!

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I was following the company for over a year when I first read about what they were doing.

They very selectively picked a handful of restaurants to introduce the product. I first tried it at the one restaurant in LA that was chosen to unveil it. They received a lot of press for it and sold out every day. After some enitial buzz, the rush to try one died out a bit.

Trying it, I thought the hype out did the actual product. It wasn’t bloody like meat, it’s consistency was closer, but still you would know it wasn’t meat. The taste wasn’t meaty enough to replace meat, but it is a better mouse trap. It was enjoyable, but for anyone that loves a great burger, someone that’s not looking to replace real meat, it’s a one time try. It’s really for vegans, vegetarians. Don’t forget that the Paleo diet is booming and I find that more people are asking for grass fed beef then a meat alternative.

We use the Gardein meatless burgers at two of our restaurants as an alternative to meat for customers.
They sell very well. We will look at Beyond Meat and compare taste, price, now that they are becoming more readily available.

So any idea when Beyond Meat is going public?



They are not marketing this product for vegans. They are having it placed in the meat isle. Their data from Kroger shows that 93% of those who bought this also bought an animal product which confirms that carnivores are also buying this. These products are betting that per capita meat consumption decreases in western countries due to a combination of ethical, ecological, and health reasons.
This article discusses some of the issues in this thread

If you’re the kind of vegan that finds the thought of eating meat revolting, then neither of these products is likely to appeal to you. But if, like Kate, you enjoy eating the real thing but like the idea of cutting down on your consumption, either one of these might fit the bill.

if your goal is to eat more whole and minimally-processed foods, both of these burgers would probably belong in the category of something that you’d enjoy occasionally but not as a daily staple. On the other hand, if your goal is to eat less meat and more plant-based protein, you might decide that more has been gained than lost here. I don’t think all processed foods can be lumped into the same nefarious category.…

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Great suggestion.

We went out for dinner last night - one person at the table was a vegetarian, and the small local restaurant sold a Beyond Burger. My oldest daughter works @ a small organic grocery store on the island we live on, and they sell the burgers. I’ll ask how fast they sell out, though we live in a very health-conscious part of Canada, and it won’t be a very good representation.

People at work get them @ A&W, and they prefer them to the real burger.

Reducing meat consumption is good for the eater, and good for the environment.

Thanks again.


So, what I don’t understand about Beyond is what is their moat? Or, as Saul described it what is the “something special”? I’m mostly a lurker, and not used to using Saul’s criteria, but this just doesn’t seem like it fits to me. A good company, a good stock, but not a “Saul pick”.

I don’t dispute that vegetarian products are on the upswing. I don’t dispute that Beyond has good products, good marketing, and good traction. But they are starting with small numbers. If this category does really become huge, what is to prevent the big players from just starting their own brand, buying a competitor, or buying Beyond?

I sort of feel like I’ve been down this road before with Morningstar Brands a long time ago.

Which, I suppose isn’t that bad of a place to be in. If Kellogg’s buys Beyond at a reasonable premium, maybe we can do well. But it just doesn’t feel like a stock that belongs here.

I’d argue that Saul’s greatest strength is recognizing the power of SaaS. It’s a new generation of lock-in with some astounding economics for the winners, especially winners with network effects. Not that every Saul pick has to be a software pick, but I feel like a Saul pick needs to have that kind of stickiness, that kind of margins, that kind of potential for huge upside.

Whereas, Beyond is in a market that traditionally has rather bad stickiness (which is mostly bound to ad budget, not product quality) and bad margins. And while there is definitely some upside, it’s not clear to me why the big guys don’t just acquire Beyond. Which is great, of course, buy is unlikely to be some big 10X play like a lot of Saul picks. Even if I like Beyond products, would a really be unwilling to switch to Morningstar if Morningstar was better/cheaper/more available?

Am I in left field?



Ok I need to update my pst on here. I misspoke.

So I was referring to The Impossible Burger when I was talking about the product that had a very limited release a year ago. That’s the one I tried that was getting an incredible amount of press and hype.

The Impossibke burger is now being sold all over, and is a much better example of a meatless buster having close to the consistency and taste of real meat.

Beyond Burger has been at my local Whole Foods for a year now. I’ve tried them. Not really close to real meat, but a decent substitute. I stopped buying them only because I don’t digest pea protein very well.

I will say that a year ago they had a very small shelf space in the refrigerator space away from any meat products. Bunched together with meatless products. Today they have their on top loading, stand alone refer that has 10 times the amount of product as before and right next to the real meat sections.

So you are right in that it’s being pushed as a meat alternative to meat eaters and seems to be doing well as their shelf space has really expanded, at least in the WFM365 that I shop in.


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Oh dear! I knew the name Beyond was familiar and it’s because I’ve bought Beyond cat food…it’s a Purina product.

Meow and bark bark Dog

Here’s a taste test
Beyond Burger vs Impossible Burger: The Verdict



What a joke. A couple of vegans taste testing. How would they know what meat even tastes like.

The one says “I haven’t had meat since I was eight years old, but to me if you fed me this burger I would say it was definitely meat, it tastes exactly like meat”. Too funny. She doesn’t eat meat but she’s an expert on what meat tastes like.

Hand those fake meat burgers to a couple of sport bar, beer drinking, burger eating dudes and see what they think.




The one says “I haven’t had meat since I was eight years old, but to me if you fed me this burger I would say it was definitely meat, it tastes exactly like meat”. Too funny. She doesn’t eat meat but she’s an expert on what meat tastes like.

I don’t she claimed to be an expert (I watched the video twice), so let me know if I am wrong on this. She does probably know how meat should taste like, given she was fed it as a kid. She might not be good reference for how a burger should taste, but she should recognize the flavor of meat – like riding a bike.

Also, there were many clips of non-vegetarians who could easily qualify for “sport bar, beer drinking, burger eating dudes” (and dudettes?) criteria who were very convinced that the burgers were meat.

Just sayin’…



So you are right in that it’s being pushed as a meat alternative to meat eaters and seems to be doing well as their shelf space has really expanded, at least in the WFM365 that I shop in.

I am an omnivore, but I would never say to myself: “Oh, I’d really like a burger tonight, but I should probably cut down on my meat consumption and go for this artificial and highly processed pea protein-enriched paste instead.” It’s just never going to happen. When I feel like having a meat-free day, I’ll make something from real non-processed food products (rice and beans or something like that).

I might not be in the target group, though. I am not obese; I already eat way more chicken and fish than red meat; I have no lifestyle-related health issues; I don’t like processed food products and I certainly never feel the need to substitute meat with something else.

I simply can’t follow the idea that if you want a meat-free day, why would you still desire to make a traditional meat-dish with a meat substitute? Why don’t you skip the “lasagne” or “meat-sauce” and have something else made of real food instead?


When I feel like having a meat-free day, I’ll make something from real non-processed food products (rice and beans or something like that).

Try making Hummus. It’s awesome. It does qualify as somewhat processed, I guess.…

It does qualify as somewhat processed, I guess.

Well, I love hummus. I meant pre-processed, not necessarily non-processed. I do in fact process a lot in my kitchen but from natural food sources like chickpeas and olive oil.

Anyway, guess recipe swapping is kinda OT here, so I’ll just say thanks, might try yours in the weekend, and leave it at that :slight_smile:

Anyway, guess recipe swapping is kinda OT here, so I’ll just say thanks, might try yours in the weekend

It’s maybe a little too much lemon, I use 3/4 of a lemon instead of a whole one.
Also, I don’t use cold water, I put in ice cubes instead, which makes the result more creamy.

Purchased Beyond Burger at Whole Foods a few months ago. Appearance, both before and after cooking is very similar to beef. Texture is also very similar to ground beef, I don’t think they’ll be doing steak however. Taste was akin to a burger, but would not easily be confused with beef. Cooking is somewhat different as well, cooks faster, releases a fair amount of water (or whatever the liquid is). I suppose if you use a lot of condiments, it would pass as a decent burger.

I was discouraged by the price. Considerably more expensive than grass-fed, organically raised beef. Unless you have some ulterior motive (i.e., vegetarian, vegan, allergy, save the planet from cow farts, etc.) I don’t know why anyone would opt to spend more to get something that’s not quite as good as the cheaper alternative. If they can bring the price down (I suppose as volume goes up, the price may come down, maybe not) they’ll get more penetration.

I will give them credit for the accomplishment. It’s truly hard to believe that it’s made from pea protein. Someone in this thread asked what’s their moat. I assume their moat is the technology behind the product, I am sure the IP is all well protected via trade secrets and patents.

I won’t be an early adopter of the product, and I won’t be buying the stock at IPO.

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Someone in this thread asked what’s their moat. I assume their moat is the technology behind the product, I am sure the IP is all well protected via trade secrets and patents.

In Denmark, a country with only 5 million people, we have at least three locally produced competing products. One of them targeting the segment of customers with the highest buying power. I don’t know how the actual products compare to Beyond Meat, but I guess it says something about the competition Beyond Meat will face on the international market.

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If this is a fringe product why are they attracting such opposition? Hmm……

Meat producers say they don’t want to lose control of labeling like the dairy industry, which lost its battle to keep almond and soy producers from using the word milk on their beverages.

This adds credence to what BYND stated in S1 “plant based meat market share can be like the non-dairy milk market share of milk”