top of page
Search
  • snitzoid

Beyond Snake Oil? The douchebags at Beyond Meat.

Updated: Nov 22, 2022

First off, the plant-based product is no better than the real thing, outrageously expensive and has more salt. Then there's the fact that the company is run by a bunch of complete jackasses.



Beyond Meat’s Very Real Problems: Slumping Sausages, Mounting Losses

Founder and CEO Ethan Brown has struggled to manage growth, some current and former employees say. ‘Pushing back on Ethan was very hard.’


By Jesse Newman, WSJ

Nov. 21, 2022 11:29 am ET



Beyond Meat Inc. BYND -1.49%decrease; red down pointing triangle was moving into its new 300,000-square-foot headquarters in the Los Angeles area last month when it laid off about one-fifth of its workforce, the second round this year.


Ethan Brown, the company’s chief executive and founder, assured employees at a town hall a day later that a more focused version of his plant-based food company would thrive. He compared Beyond to Starbucks Corp. and Martin Cooper, an inventor of the cellphone, saying people thought they would fail, too.


“The path is rarely straight and smooth,” Mr. Brown wrote in a company email about the layoffs.


In May 2019, Beyond launched one of the most successful initial public offerings by a major company in more than two decades, according to Dealogic data. It snagged entertainers Snoop Dogg and Leonardo DiCaprio as boosters and signed deals with major restaurants and supermarket chains that propelled its valuation to over $10 billion later that year.


Since then, the company has been losing money and amassing debt. It has shed a series of executives, including its chief operating officer, who was arrested in September after he was accused of biting a person’s nose. U.S. grocery sales of plant-based meat substitutes are declining, and rival imitation-meat makers are capturing market share. Beyond’s stock is down 83% in the last 12 months.


At the helm is Mr. Brown, who quit a career in alternative energy and started Beyond in 2009 in a commercial kitchen in Maryland. The 51-year-old is credited with helping expand the market for meat substitutes with his plant-based sausages and burgers designed to look, cook and taste like the real thing.


But some current and former employees said Mr. Brown also has struggled to stick to priorities and manage Beyond’s growth—switching gears frequently in ways that has left teams confused and frustrated.


Mr. Brown’s drive to roll out new products on rushed timelines led to missed deadlines, disappointed customers and wasted packaging and ingredients, according to internal company documents and emails and current and former employees. A new offering backfired when veggie sausages slumped in their packaging on store shelves.


Seth Goldman, the chair of Beyond’s board, said there can be tension between passionate founders and the realities of trying to structure a large business. Beyond has had to build technology, supply chains and other elements from scratch, he said, as it grew over roughly a decade to a more than $400 million business.


“There is inevitably an element of chaos,” Mr. Goldman said, adding that he supports Mr. Brown.


The company operates from a three-year strategic vision and an annual plan that prioritizes projects with customers and partners, said Beyond spokeswoman Shira Zackai. Those plans support Beyond’s rapid innovation, which borrows from a model used by technology companies, she said.


In the past year, the company has tested or introduced nine products at restaurants in 18 countries and begun offering six new products in U.S. stores, Ms. Zackai said.


“The pace and intensity of our innovation is not for everyone,” she said. “It does, however, produce extraordinary results which we believe will, over time, deliver outsized impact for the world and strong returns for our investors.”


Some current and former Beyond executives and employees including chief innovation officer Dariush Ajami and senior vice president of operations Jonathan Nelson said Mr. Brown is an open-minded leader who sets clear plans for the company. Garrett Morgan, Beyond’s head of global strategy, said Mr. Brown mixes strategic vision with a practical mind-set.


Plans change and Beyond works to be agile, Mr. Morgan said, but the company follows consistent priorities even as it responds to shifting market conditions and other dynamics.


Mr. Brown has said Beyond and other meat-alternative companies are facing challenges as they compete with less expensive real meat at a time of inflation and consumer uncertainty over the health benefits of what many see as highly processed products.


As he started his company, Mr. Brown licensed a process developed by University of Missouri researchers that combined proteins from plants into a molecular structure resembling animal muscle. Beyond’s patties are made by extracting protein from yellow peas and other sources and mixing it with ingredients such as canola oil, potato starch and beet juice color to produce burgers that suggest ground beef.


Targeting carnivores rather than vegans and vegetarians, Beyond’s burger made its debut in the meat case at Whole Foods Market in 2016. The burgers, which mimic the grilled sizzle of a meat patty, found a foothold among conventional grocers, and along with products from rival plant-based meat maker Impossible Foods Inc., helped revolutionize America’s veggie-burger business.


Investors poured money into Beyond as the company’s annual sales soared, increasing more than fivefold to $88 million between 2016 and 2018.


Tim Geistlinger, Beyond’s vice president of research and development until he left in 2016, said exuberance over the company’s rapid growth came with ever-evolving priorities, as Beyond sought and won over customers such as fast-food chains that executives called “whales.”


Mr. Brown wanted to make progress as fast as possible and worry about details later, a common characteristic of startup founders, Mr. Geistlinger said.


That passion made Mr. Brown one of the plant-based protein sector’s best public advocates, Mr. Geistlinger said. Still, before leaving, he advised the company to bring in more experienced leaders to manage its growing operations.


“Pushing back on Ethan was very hard,” Mr. Geistlinger said. “He didn’t want to hear things that were contrary.”


Mr. Geistlinger also praised Mr. Brown for trying to disrupt the global meat industry.


Backed by its board of directors, Beyond worked to create new products and quickly increase its manufacturing capacity while interest in the sector was hot, said Mr. Goldman, who co-founded Honest Tea, acquired by Coca-Cola Co., and has for years counseled Mr. Brown.


Beyond’s sales grew 56% to $465 million between 2019 and 2021. Its costs and debt grew far faster.


Expenses tied to research and development more than tripled during that time, and capital expenditures increased more than fivefold. In January 2021, the company that once occupied 3,000 square feet of lab space in El Segundo, Calif., signed a 12-year lease valued at more than $150 million to build a campus about 100 times as large.


The campus was to include living interior walls, a fitness center and “future-forward research incubators,” according to a news release announcing the project. Inside headquarters last month, plastic tarps still hung from ceilings, and lab chairs bore their sales tags.


Beyond’s roster of full-time employees and contract workers swelled roughly 10-fold between the end of 2016 and the end of 2021, according to a company filing. Its manufacturing capacity increased roughly 30% in 2021 as Beyond brought online facilities in the Netherlands and China.


Beyond’s losses deepened from $12 million to $182 million while its debt climbed to $1.1 billion between 2019 and 2021. The company’s losses in the nine months ending Oct. 1 were $299 million, and its debt load hadn’t budged.


While Mr. Brown turbocharged growth, a gulf emerged between the team responsible for developing new products and the group that figures out how to produce them at large volumes, according to current and former employees.


Innovations made in small quantities by hand in Beyond’s research laboratories often would spur Mr. Brown and other top executives to make commitments to customers before the company knew how to produce the food at large scale in factories, the employees said. Beyond at times purchased millions of dollars worth of equipment it didn’t need.


Mr. Ajami, Beyond’s chief innovation officer, said Beyond employees work closely together to develop products that have never been made before. “It requires lots of outside thinking, lots of collaboration and hand-holding, you know, to get from one step to the other,” he said.


Beyond’s jerky, launched last spring as part of a joint venture with PepsiCo Inc., faced a rocky and expensive path to production after Beyond struggled to re-create an early, lab-crafted version in bulk at plants, according to current and former employees and company emails. Initially, the jerky had to be made in facilities across several states, boosting its cost of production and squeezing profit margins.


Beyond said in its November earnings call that the jerky project had reduced the company’s gross profit by $6 million in the most recent quarter as third-party manufacturing capacity was underused or canceled.


A rush to market hurt the company’s first chicken-tender-like product to hit store shelves last year, current and former employees said.


Beyond ran into difficulties producing the tenders and, shortly before the product was due on supermarket shelves, turned to a third-party manufacturer.


When details of the nutritional value, such as the amount of protein and saturated fat included, hadn’t been settled, Beyond printed multiple versions of its packaging and discarded what it didn’t use, the employees said and company emails showed.


Beyond’s stock is down 83% in the last 12 months.


Beyond’s 2020 launch of a new version of its dinner sausages suffered as a result of insufficient testing. The appearance of the sagging sausages turned off consumers, and some didn’t like the new flavor or feel, prompting Beyond to pull them from stores, according to internal company emails and current and former employees.


Mr. Brown’s drive to get products to market and strike deals with restaurant chains regularly trumped a focus on short-term profitability, according to current and former employees.


Beyond’s expansion into Europe came with costly problems, according to company documents and current and former employees, who said burgers and sausages have spoiled in stores overseas because European refrigerators are kept at warmer temperatures than those in the U.S.


Shelf life is too limited and “we face a lot of write offs and high waste costs at retailer side—up to 20-35% for some items on total sales,” according to a company document.


To help build out its operations, Beyond announced last December it had hired two meat industry veterans, executives at Tyson Foods Inc. Both had left Beyond by the end of October.


Doug Ramsey, Beyond’s chief operating officer, departed shortly after he was arrested for biting someone and threatening to kill him during a fight outside a college-football game in Arkansas. He had been working to integrate the company’s innovation and commercialization teams, employees said.



Bernie Adcock was Beyond’s chief supply chain officer until stepping down to take a leadership position at chicken giant Pilgrim’s Pride Corp.


Mr. Ramsey and Mr. Adcock didn’t respond to requests for comment.


As Mr. Brown works to give his 13-year-old company a narrower focus, it faces a new challenge: inflation.


U.S. grocery sales of plant-based meat substitutes are falling overall, and Beyond’s are dropping at an even faster rate. In the 12 weeks ended Oct. 8, Beyond’s sales declined 21% by volume versus the year-ago period, according to NielsenIQ data provided by an analyst. The overall category declined 8%.


Rival Impossible’s sales rose 49% in that period, as the company expands its retail presence with more items, according to Credit Suisse analyst Robert Moskow. Impossible also attributed its growth to its product quality and per-store sales gains.


Beyond has slowed or idled some production at plants in places such as Pennsylvania, according to former employees, and Mr. Brown said on the November earnings call that Beyond is working to reorganize its manufacturing.


The company also has said it is significantly reducing expenses and aims for “cash-flow positive operations” in the second half of 2023.


Following the recent layoffs, Beyond said it would stop sending samples to buyers and influencers for at least two to three weeks after losing the people who ran those functions, according to an internal company email.


Beyond is urging employees to pick budget hotels for work travel and will serve more of its own products, including the jerky, as snacks at headquarters.


On the November earnings call, Mr. Brown outlined a plan for stabilizing Beyond’s business, including by focusing on its core products, such as plant-based sausages and burgers.


It is a pivot, Mr. Brown said, from the “growth-above-all” model.


Write to Jesse Newman at jesse.newman@wsj.com

5 views0 comments

Recent Posts

See All

Zelensky claims only 31,000 Ukrainian Troops killed?

A year ago, former Army officer Colonel Douglas Macgregor put the total at approx 400,000. That number has hypothetically grown significantly. Do I believe Macgregor? Yes. The carnage suffered by pro

I'm concerned this may decimate professional bowling!

Hauling this guy away in irons mid-tournament is unforgivable. There's goes the PBA's (Professional Bowlers Association you ignoramus) endorsement deals with Toys-R-US, Kool-Aid, Facebook, Marvel Movi

Post: Blog2_Post
bottom of page