Last year, a top executive at one of America’s biggest alternative meat product manufacturers was arrested for sinking his teeth into another man during a road rage incident in Arkansas.
Douglas Ramsey, chief operating officer of Beyond Meat, later pleaded guilty to punching the motorist and biting him on the nose. The confrontation took place in a car park following an American football game after Ramsey accused the victim of bumping one of the front tires of his SUV.
For a company dedicated to weaning people off meat, it’s hard to think of a more unfortunate bit of publicity than one of your top bosses trying to tuck in to a potential customer.
But then this is an outfit with a penchant for fatuous hipster babble such as “help humans eat nutritious” and “eat what you love”, so you can understand if Ramsey thought he was being encouraged to eat meat rather than stop consuming it. Or perhaps, after being forced to consume nothing but faux-flesh made from beetroot juice and methylcellulose for months on end, he craved some real bone and gristle.
Another possibility is that Ramsey was angry after seeing the state of Beyond Meat’s share price, and concluding, like many other people, that the fake meat fad is nothing more than another venture capital-fuelled waste of money.
It’s certainly hard to conclude otherwise after an abysmal set of financial results wiped an eye-watering 19pc off its already battered share price. Sales have collapsed by nearly a third in the last three months alone, the company is burning through cash and forecasts have been torn up.
The California-based company was supposed to be the poster child for the vegan movement but instead it risks becoming a symbol of the worst excesses of the cheap money era of the last decade.
Beyond Meat debuted on the Nasdaq stock exchange in May 2019 at $25 per share. The listing received the enthusiastic backing of Wall Street, yet got the full Silicon Valley treatment.
A star-studded roster of no less than seven investment banks were the underwriters for a float that was 30 times oversubscribed despite the company’s questionable financial history. In its last year before going public, Beyond Foods managed to chalk up losses of $30m (£23.5m) having generated just $88m of turnover.
But like so much of what comes out of the Golden State, its prospects appear to have been an all-too-familiar case of hope triumphing over reality. Shares in Beyond Meat rocketed as high as $234 in the weeks after the share sale, briefly valuing the company at $14bn before crashing back down.
By the time of Ramsey’s human picnic, the stock was trading around the $15 mark. They’re now down at $12, where they may well stay amid analysts’ talk about the need to raise additional capital.
There are many things wrong with the fake meat industry, not least the concept itself. Surely the overwhelming reason that the vast majority of vegetarians and vegans stop eating meat is that they abhor the killing of animals. So why then would they want to recreate the experience – blood and all – only using pea protein instead?
My suspicion – admittedly based on nothing other than a strong inkling – is that vegans don’t want food that bleeds, just as meat-eaters don’t crave burgers made in a laboratory from potato starch.
So who does that leave? Virtue-signalling Gen-Z-ers bored with drinking their tasteless oat-milk lattes? That’s if they can afford the luxury. Another oddity of fake meat products is that they are often more expensive than the real thing, and where they’re not, they certainly wouldn’t be considered a cheap alternative.
So if you were toying with the idea of dabbling in veganism, one look at the prices might make it a fairly fleeting thought. And if you were already a vegetarian, you might conclude that a plate of old-fashioned legumes was far more affordable, not to mention more nutritional.
In response to perceptions that its products are unhealthy and overly-processed, Beyond Meat has launched an advertising campaign that seeks to highlight the supposed health benefits of its products. “It is an education issue. The facts are there. The health benefits … are very strong,” chief executive Ethan Brown said on a conference call with investors.
In the end, for all its expensive technology and tens of billions of investment, the fake meat industry was no more equipped to escape the twin forces of inflation and monetary tightening than any other company. With household budgets under immense pressure, is it any wonder sales are plummeting?
The bubble has burst as shoppers seek out cheaper alternatives, and many are no doubt reminded that there are better tasting ones, too. Or is it just that plant-based food, for all its clever marketing, isn’t very good? It may turn out to be a short-lived fad even by the standards of the American tech industry.
Profligate venture capitalists have an unenviable history of throwing their weight behind some truly terrible business ideas. But the last 10 years of rock-bottom interest rates has served up countless costly misadventures, having also blessed us with 10-minute supermarket deliveries, electric scooters, and restaurants serving edible insects.
The industry must learn to stop believing every optimistic idea is the next big thing.