WEBVTT - Mark Rampolla on Peak Alt-Meat 0:00:01.040 --> 0:00:06.440 I'm Bethany McLean. This is making a killing in this show. 0:00:06.519 --> 0:00:09.200 I cut through the hype and handwringing to reframe the 0:00:09.240 --> 0:00:12.520 stories you thought you understood and uncover the ones you 0:00:12.600 --> 0:00:29.680 didn't know were important. I love industry makers. No one 0:00:29.720 --> 0:00:33.199 sees a new industry coming and then seemingly overnight, it's 0:00:33.200 --> 0:00:36.040 a way of life. The iPhone was an industry maker 0:00:36.040 --> 0:00:39.320 for mobile smartphones. The Prius was an industry maker for 0:00:39.400 --> 0:00:43.639 hybrid cars. You can argue Elon Musk's Tesla was an 0:00:43.640 --> 0:00:47.400 industry maker for electric cars, and so on. It seems 0:00:47.400 --> 0:00:49.840 to me that there's always a cycle. After a few 0:00:49.880 --> 0:00:52.920 false starts from two early inventors, we get that one 0:00:53.000 --> 0:00:56.960 company that blows us all away and makes a new industry. Then, 0:00:57.160 --> 0:00:59.880 as fast as you can say knockoff, there are competitors, 0:01:00.400 --> 0:01:04.880 fierce competitors. After this hunger game style elimination period, the 0:01:05.000 --> 0:01:08.840 strong remains standing and make themselves part of our everyday existence. 0:01:09.520 --> 0:01:11.800 I have with me today, Mark Rampola, who has been 0:01:11.840 --> 0:01:15.600 at the forefront of not one, but two industry making companies. 0:01:15.959 --> 0:01:19.119 The first was his own company, Zico Coconut Water, which 0:01:19.160 --> 0:01:23.360 berthed in eight billion dollars alternative beverage coconut water industry. 0:01:23.720 --> 0:01:27.000 His book High Hanging Fruit tells the whole dramatic story. 0:01:27.880 --> 0:01:30.240 The next was Beyond Meat, where Mark has been involved 0:01:30.240 --> 0:01:32.800 as an investor rather than as a founder or CEO. 0:01:33.280 --> 0:01:35.760 Beyond Meat is the poster child for the plant based 0:01:35.760 --> 0:01:38.959 food revolution. I knew we had reached peak alt meat. 0:01:39.080 --> 0:01:41.840 Not when Beyond Meat had a monster IPO in May 0:01:41.840 --> 0:01:45.479 of twenty nineteen, but when a few months later Duncan 0:01:45.560 --> 0:01:49.840 Donuts rolled out the Beyond Sausage plant based breakfast sandwich 0:01:49.880 --> 0:01:53.520 in partnership with Beyond Meat. Then came the Impossible Burger. 0:01:54.000 --> 0:01:58.400 Even long established Tyson Tyson has come out with raised 0:01:58.440 --> 0:02:02.080 and rooted plant based nugget. Oh, and then there's Kellogg's 0:02:02.120 --> 0:02:05.480 morning Star Farms, which has announced a line called, wait 0:02:05.560 --> 0:02:09.560 for it, incog Meato. I can't decide if that's clever 0:02:09.680 --> 0:02:12.799 or just awful, but giggles aside, and let's say they're 0:02:12.919 --> 0:02:16.640 serious money and plant based alternatives. Currently, the market is 0:02:16.639 --> 0:02:20.120 fourteen billion dollars in the US, and Berkeley's estimates that 0:02:20.160 --> 0:02:23.080 it could balloon to one hundred and forty billion in 0:02:23.120 --> 0:02:26.359 the next decade. Mark has unique insight into what it 0:02:26.400 --> 0:02:30.000 means to be the pioneering brand that then quickly gets copied. 0:02:30.680 --> 0:02:33.120 Is there such a thing as first mover advantage? And 0:02:33.240 --> 0:02:35.720 if so, how do you hang onto it? And our 0:02:35.720 --> 0:02:39.200 meat alternatives really the way of the future. I'm recording 0:02:39.240 --> 0:02:42.520 this here in the home of the In and Out Burger, California, 0:02:42.560 --> 0:02:45.000 and I'm delighted to have Mark here with me. So 0:02:45.040 --> 0:02:46.960 what's it like, Mark, to be at the vanguard of 0:02:46.960 --> 0:02:49.600 a new industry for the second time. I really hadn't 0:02:49.639 --> 0:02:51.720 thought about it that way, and it's pretty amazing to 0:02:51.760 --> 0:02:54.200 be a part of that. When I first started launching Zico, 0:02:54.320 --> 0:02:56.600 it was just a coconut water. I had no idea. 0:02:56.600 --> 0:03:00.040 I had some dreams, some hope, some asspirations, but I 0:03:00.120 --> 0:03:01.880 had no idea. When I look back and think that 0:03:01.960 --> 0:03:05.200 it's now an eight, probably ten billion dollar global category, 0:03:05.200 --> 0:03:09.160 it's absolutely amazing and beyond meat. Similarly, it's an amazing 0:03:09.480 --> 0:03:12.280 story to be a part of this whole plant based revolution. 0:03:12.880 --> 0:03:15.160 So did you see it this time because of your 0:03:15.200 --> 0:03:17.840 experience with Zicco, did you see that beyond me it 0:03:17.919 --> 0:03:21.760 was going to be creating this industry making revolution. Is 0:03:21.800 --> 0:03:24.280 it different in that respect or was it just this 0:03:24.360 --> 0:03:26.880 is a great product it is. It's a little different 0:03:26.919 --> 0:03:30.000 I think experience during that period of having started Zco 0:03:30.040 --> 0:03:32.519 and then invest in Beyond Meat through my fund power 0:03:32.560 --> 0:03:35.640 Plant Ventures, I'd looked at a couple of thousand companies, 0:03:35.640 --> 0:03:38.560 and so I think developed a couple of thousand. Wow. Yeah, 0:03:38.600 --> 0:03:41.040 we look as a fund about one hundred a month 0:03:41.400 --> 0:03:45.680 new upstart, early staged food and beverage, food service, food 0:03:45.680 --> 0:03:47.880 tech companies. Okay, so you have to pause on that 0:03:47.920 --> 0:03:51.360 without divulging any competitive information, can you give me a 0:03:51.400 --> 0:03:53.880 feel for the weirdest idea you've heard, for the most 0:03:53.880 --> 0:03:57.080 revolutionary Yeah, so some people are really fanatical about this, 0:03:57.160 --> 0:04:01.040 but the whole insect side of things, right, I'm not 0:04:01.240 --> 0:04:03.480 buying it yet. I'm not chewing on it yet. I'm not. 0:04:03.640 --> 0:04:06.520 It's Look, it's interesting, right, there's a lot of parallels. 0:04:06.800 --> 0:04:09.360 People do eat them all across the world, all sorts 0:04:09.360 --> 0:04:12.360 of reasons. There's an environmental reason, there's a social impact reason. 0:04:12.840 --> 0:04:16.040 But at this day and time, I don't think Americans 0:04:16.040 --> 0:04:19.000 are ready for it. And so that's a little out there, 0:04:19.040 --> 0:04:21.159 and we've seen some ones that are that are pretty 0:04:21.200 --> 0:04:23.680 odd and that you have passed on. Okay, how did 0:04:23.800 --> 0:04:25.839 Beyond Me it come to you and what made you 0:04:25.920 --> 0:04:30.000 say yes? This so a couple of things. One my partners, 0:04:30.040 --> 0:04:33.280 actually empower Plant, had known Ethan Brown, the founder, from 0:04:33.560 --> 0:04:37.080 day one and had an opportunity to invest. They passed 0:04:37.120 --> 0:04:39.960 because they owned a restaurant chain called Veggie Grill and 0:04:40.080 --> 0:04:42.160 viewed it as sort of a conflict of interest. It's 0:04:42.160 --> 0:04:44.200 one of the reasons we started the fund. I was 0:04:44.240 --> 0:04:46.200 seeing a lot of deals that we thought were interesting, 0:04:46.240 --> 0:04:48.440 and so Ethan was always on our radar. He was 0:04:48.480 --> 0:04:51.440 an extraordinary founder, and that's paramount for us. We always 0:04:51.440 --> 0:04:54.760 look for the individual. You know, great founders build great companies. 0:04:54.880 --> 0:04:58.640 Rarely do great companies just happened, and so Ethan was 0:04:58.640 --> 0:05:01.440 a winner from the beginning and his co founder. But 0:05:01.600 --> 0:05:03.360 we didn't have a fund up in running. They went 0:05:03.360 --> 0:05:05.560 out and raised money, and when we finally had our 0:05:05.560 --> 0:05:07.160 fund up and reading and got a look at it, 0:05:07.600 --> 0:05:10.680 we knew this was really interesting, particularly because they had 0:05:10.720 --> 0:05:13.440 a number of products on the market that were good 0:05:13.480 --> 0:05:16.159 but not great, and they were doing okay and whole 0:05:16.160 --> 0:05:19.080 foods in other places, but not exceptional. But when they 0:05:19.160 --> 0:05:22.799 rolled out what they called the Beyond Burger, we knew. 0:05:22.920 --> 0:05:25.760 The way we knew was we have relationships at Whole 0:05:25.800 --> 0:05:28.240 Foods were in the stores. We have people that we 0:05:28.320 --> 0:05:31.600 know at the stores and through Veggie Grill. Veggie Grill 0:05:31.680 --> 0:05:34.040 was the first place that they sold the Beyond Burger, 0:05:34.600 --> 0:05:37.760 and we also literally saw the first week of sales 0:05:38.000 --> 0:05:42.599 in Whole Foods. That first week it became the best 0:05:42.600 --> 0:05:45.320 selling product in the whole store seriously and the whole 0:05:45.320 --> 0:05:49.200 Tire store right and Veggie Grill. In the first month 0:05:49.279 --> 0:05:52.919 that they rolled it out, it single handedly brought I 0:05:52.960 --> 0:05:56.080 think double digits same store sales growth. You ever, and 0:05:56.120 --> 0:05:59.200 why what made the Beyond Burger so beyond? I think 0:05:59.279 --> 0:06:00.880 it's a couple of things, a couple of vectors that 0:06:00.960 --> 0:06:03.680 came together to make this happen. Still, the statistics are, 0:06:03.720 --> 0:06:05.560 you know, maybe two to three percent of the population 0:06:05.640 --> 0:06:09.039 is true hardcore vegan. I think in general, there's moved 0:06:09.080 --> 0:06:14.120 into the zeitgeist, this plant based plant forward understanding to 0:06:14.560 --> 0:06:17.640 have more plants, you know, have meatless Monday. That sort 0:06:17.680 --> 0:06:21.039 of has happened much more broadly than just Beyond meeting 0:06:21.080 --> 0:06:25.680 that's probably been building for thirty years on three key areas. 0:06:25.800 --> 0:06:29.120 One is, so I think there's this a general awareness 0:06:29.120 --> 0:06:33.520 about health and wellness and how particularly unhealthy, highly processed 0:06:33.520 --> 0:06:37.000 meets play a negative factor in that. The other is 0:06:37.320 --> 0:06:41.400 environmental and certainly humanitarian reasons, right, So those three are 0:06:41.520 --> 0:06:46.440 coming into more common thinking, particularly among millennials. And the 0:06:46.520 --> 0:06:50.120 product was very different. Think what you want about it. 0:06:50.240 --> 0:06:53.640 Relative to nine percent of all the veggie birds that 0:06:53.640 --> 0:06:56.400 have ever been on the market. It's a very different experience. 0:06:57.040 --> 0:06:58.800 And you know, they're never going to compete with a 0:06:58.880 --> 0:07:02.159 Kobe beef burger, but relative to a lot of the 0:07:02.200 --> 0:07:06.000 crap that's on the market in McDonald's burger King and 0:07:06.600 --> 0:07:09.920 every college campus in high school around the country, those 0:07:09.960 --> 0:07:13.440 hamburgers are crap. What's the breakthrough? What makes the burger 0:07:13.520 --> 0:07:18.000 so different? What they did is they applied existing technology 0:07:18.240 --> 0:07:20.960 something it's called extrusion technology. It's used in a lot 0:07:21.000 --> 0:07:24.400 of food processes used in other arenas, but had never 0:07:24.440 --> 0:07:28.360 been really applied to something like plant proteins. And so 0:07:28.400 --> 0:07:32.080 they use very available plant proteins, predominantly p but they 0:07:32.080 --> 0:07:35.760 can use other feedstocks, and they process it in a 0:07:35.800 --> 0:07:38.400 way it sounds a little gross, but it's almost comes 0:07:38.400 --> 0:07:40.440 out like a meat grinder. Would you know where you 0:07:40.680 --> 0:07:43.280 get this this raw material that can then be formed 0:07:43.320 --> 0:07:46.040 into burgers and so you know, there's some food signs 0:07:46.080 --> 0:07:48.720 in there and engineering. A lot of chefs have been 0:07:48.760 --> 0:07:52.200 involved in creating that, and they brought something that's really amazing. 0:07:52.280 --> 0:07:55.400 And I think, for example, my wife has been plant 0:07:55.440 --> 0:07:57.520 based for twenty years. You know, she had it and 0:07:57.560 --> 0:08:00.240 she's like, yeah, I don't miss meat. I do. I've 0:08:00.280 --> 0:08:02.520 only been plant based for a few years, and so 0:08:02.600 --> 0:08:05.520 for me to get that sort of sensation and that 0:08:05.720 --> 0:08:08.640 feeling and be able to have a burger is something 0:08:08.720 --> 0:08:11.720 I miss. So that's the core thing, am I right? 0:08:11.840 --> 0:08:15.160 That makes what's going on now different than what's come before, 0:08:15.240 --> 0:08:18.320 and that what's come before veggie burgers catering to people 0:08:18.320 --> 0:08:21.640 who are already vegetarian. This is a huge expanse of 0:08:21.640 --> 0:08:23.880 the market because this is a burger that is aimed 0:08:23.880 --> 0:08:26.320 at people who are meat eaters and want something that 0:08:26.440 --> 0:08:29.320 is comparable. And so suddenly you're going from niche to 0:08:30.040 --> 0:08:32.640 every day? Is that the right idea? And I'll tell 0:08:32.640 --> 0:08:35.600 you specifically something that was fascinating when they first rolled 0:08:35.600 --> 0:08:39.040 out that product. Ethan and Seth Goldman that became chairman 0:08:39.080 --> 0:08:42.040 of the board, were adamant, we want this in the 0:08:42.160 --> 0:08:45.719 meat section of the stores. Oh really, They went to 0:08:45.840 --> 0:08:48.720 retailers and literally said, we will not sell it to 0:08:48.760 --> 0:08:52.280 you unless he goes right next to meet Wow. What 0:08:52.480 --> 0:08:55.000 was it like to try to convince retailers to do that? 0:08:55.080 --> 0:08:58.080 Because I'm always interested in this gap if you will, 0:08:58.160 --> 0:09:01.840 between great idea wow, But then the dirty work of execution, 0:09:02.000 --> 0:09:04.080 right or the gritty work is a better word than 0:09:04.120 --> 0:09:06.280 dirty work of execution. The first thing they did is 0:09:06.280 --> 0:09:09.120 they built a team that was extraordinary. So they built 0:09:09.120 --> 0:09:11.080 the sales team that had done this in the past 0:09:11.160 --> 0:09:15.320 with other categories, understands the way retailers think, what metrics 0:09:15.400 --> 0:09:18.240 they want to see, how to communicate with them. And 0:09:18.320 --> 0:09:20.319 I don't recall the exact details of the story, and 0:09:20.360 --> 0:09:22.960 I'm not sure I know all the details as an investor, 0:09:23.320 --> 0:09:26.160 but what my recollection is the way typically a company 0:09:26.200 --> 0:09:28.719 would do this is you sit down with Whole Foods, 0:09:28.760 --> 0:09:31.360 maybe a target, maybe a safe way, and you say, look, 0:09:31.400 --> 0:09:33.520 this is what we're trying to achieve, do you want 0:09:33.520 --> 0:09:35.880 to get behind it. Whole Foods has a history of 0:09:35.920 --> 0:09:38.520 sort of being a leading edge, so typically they'll take 0:09:38.559 --> 0:09:41.080 a risk. And so the team went in and said 0:09:41.080 --> 0:09:42.960 the Whole Foods, look, if we're going to do this, 0:09:43.000 --> 0:09:44.520 we want to do it big. It's got to be 0:09:44.600 --> 0:09:47.200 right next to meet it's disruptive, and Whole Foods took 0:09:47.200 --> 0:09:49.720 that risk. And once Whole Foods took the risk and 0:09:50.040 --> 0:09:52.640 you had data that you could share with other retailers, 0:09:53.040 --> 0:09:55.800 then literally the conversation is, mister retailer, do you want 0:09:55.840 --> 0:09:58.880 the product or not? Some retailers held back. There's some 0:09:58.960 --> 0:10:01.200 major retailers in the country that were late to the 0:10:01.200 --> 0:10:02.960 Beyond Burger because they didn't want to put it. They 0:10:02.960 --> 0:10:05.280 wanted to put it in the frozen section or in 0:10:05.320 --> 0:10:08.120 the veggie burger section. And what was fascinating is I 0:10:08.240 --> 0:10:11.680 know that there were hardcore vegans, sort of the vegan 0:10:11.760 --> 0:10:15.320 mafia people say that we're furious with Beyond Meat because 0:10:15.320 --> 0:10:17.080 they said, I don't want to go near that section. 0:10:17.559 --> 0:10:20.440 I don't want to shop in that area. And to 0:10:20.520 --> 0:10:23.040 think that talk about like somebody that wants to change 0:10:23.080 --> 0:10:27.040 the world yet is worried about their own uncomfort zone 0:10:27.200 --> 0:10:29.720 versus the impact they can have to get meat eaters 0:10:29.720 --> 0:10:32.160 to eat this. There's a hypocrisy and that isn't there. 0:10:32.200 --> 0:10:35.000 That's interesting, but that was also brave on Beyond Meat's 0:10:35.120 --> 0:10:38.680 part to take the risk of alienating what would have 0:10:38.720 --> 0:10:41.960 been a very safe and secure core consumer in order 0:10:42.000 --> 0:10:44.680 to say no, no, no, we're going after the world 0:10:44.679 --> 0:10:46.600 and we're changing the world, right. I mean, there's real 0:10:46.640 --> 0:10:50.480 bravery associated with nowed it. We infuriated a lot of 0:10:50.520 --> 0:10:54.120 early Bickram yoga fanatics when we started to sell Zeco everywhere, 0:10:54.200 --> 0:10:58.080 like sort of by definition with these early adopter there's 0:10:58.160 --> 0:11:01.360 rid exceptions like perhaps the iPhone right right where by 0:11:01.400 --> 0:11:04.520 and large, these products, these categories are built by early 0:11:04.520 --> 0:11:07.880 adopters and sort of by definition, the early adopters onto 0:11:07.960 --> 0:11:11.000 the next thing, right, and so often that's the trend 0:11:11.040 --> 0:11:14.800 that happens. So is this a case of technological advancement? 0:11:14.960 --> 0:11:18.160 Is that modern technology that enables something like the beyond 0:11:18.160 --> 0:11:21.559 Burger to be produced? Or was the technology over always 0:11:21.640 --> 0:11:24.160 there and nobody had just thought about doing it this 0:11:24.200 --> 0:11:27.040 way or conceiving of it in this way the ladder. 0:11:27.320 --> 0:11:32.679 There's no earth shattering crazy new technology there. What is unique, 0:11:32.840 --> 0:11:35.400 and we're seeing this across a lot of the companies 0:11:35.440 --> 0:11:39.400 we look at is applying a tech mindset to food. 0:11:39.679 --> 0:11:41.440 And there's a lot of pluses of that, and there's 0:11:41.480 --> 0:11:45.520 some negatives, but there is a general sense that anything's 0:11:45.559 --> 0:11:48.240 possible if you put time and effort in good brain 0:11:48.280 --> 0:11:51.760 power behind it that you can come up with innovative 0:11:51.760 --> 0:11:54.880 solutions that you start with a consumer and sort of 0:11:54.880 --> 0:11:57.400 work backwards on how to solve a problem. A lot 0:11:57.400 --> 0:12:00.360 of those mindsets are really only in the last ten 0:12:00.440 --> 0:12:03.440 years or so applying in the food and we're seeing that. 0:12:03.440 --> 0:12:06.400 We're seeing One of our biggest fans or sort of 0:12:06.400 --> 0:12:10.680 supporters is the director of alumni affairs for Stanford, who 0:12:10.720 --> 0:12:13.000 came to us and said, something's going on here because 0:12:13.080 --> 0:12:15.240 ten years ago, all my top students that wanted to 0:12:15.240 --> 0:12:17.719 be entrepreneurs went in the tech. Now they all want 0:12:17.720 --> 0:12:19.520 to go in the food and it's all plant based, Like, 0:12:19.600 --> 0:12:21.839 what the hell's going on? Yeah, how long ago is that? 0:12:21.880 --> 0:12:26.440 But that's fascinating, fascinating, So you have this whole new mindset. 0:12:26.520 --> 0:12:29.160 So that's the mindset is. You know, Ethan's a wicked 0:12:29.160 --> 0:12:32.760 smart guy. Ethan Brown born ten or twenty years earlier, 0:12:32.760 --> 0:12:35.440 probably would have gone into tech, and he's going into 0:12:35.480 --> 0:12:37.680 a version of tech he is he has or gone 0:12:37.679 --> 0:12:40.360 into social impact. He's a radical, you know, animal rights 0:12:40.360 --> 0:12:43.719 activist or not the nonprofit world. But in today's day 0:12:43.720 --> 0:12:46.840 and age, there's an opportunity to sort of bridge those 0:12:46.880 --> 0:12:50.040 gaps and make a real impact through business. Before we 0:12:50.520 --> 0:12:53.640 move on, you mentioned the positives and the negatives of 0:12:53.679 --> 0:12:57.080 this ability to process plants in a different way, and 0:12:57.200 --> 0:12:59.920 that is one of the criticisms I've heard of this plan, 0:13:00.120 --> 0:13:02.640 or one of the marks of skepticism I've heard about 0:13:02.640 --> 0:13:05.760 this plant based industry, which is, wait, how does this 0:13:05.880 --> 0:13:09.040 go with the notion of an unprocessed lifestyle if these 0:13:09.080 --> 0:13:11.480 things are so heavily processed, and is that what you 0:13:11.520 --> 0:13:15.160 mean by trade offs? And how do you think about that? Absolutely? So, Look, 0:13:15.280 --> 0:13:17.680 what I'm very clear on and hope to work to 0:13:18.400 --> 0:13:22.040 myself and for our world, is that we get as 0:13:22.120 --> 0:13:25.719 close as we can to the plants, weed, that they 0:13:25.760 --> 0:13:30.520 are in clean, healthy soil, that is in a regenerative format, 0:13:30.559 --> 0:13:34.440 that the whole system is thoughtful about the soil, the forest, 0:13:34.559 --> 0:13:37.400 the ocean, and we are consuming food that is as 0:13:37.520 --> 0:13:40.800 nutrient dense and close to the source as possible. That's 0:13:40.880 --> 0:13:43.880 the solution. That's the healthiest way to live. Barn One. 0:13:44.559 --> 0:13:49.280 The reality is I don't eat that way. I have time, money, capability, 0:13:49.440 --> 0:13:52.880 I have and tried to garden for my entire life. 0:13:53.440 --> 0:13:55.719 And the reality is, how often do I do it 0:13:55.800 --> 0:13:57.880 half my eating that way of a fast paced life. 0:13:57.880 --> 0:14:01.000 I'm moving, and so the reality is we make those compromises. 0:14:01.040 --> 0:14:03.880 And so you know, Ethan Brown actually talked about this recently, 0:14:03.920 --> 0:14:06.160 I think it was I think it was Chipotle had 0:14:06.200 --> 0:14:08.200 refused to bring them in at least this was as 0:14:08.200 --> 0:14:10.040 a few months or a year ago or so. One 0:14:10.040 --> 0:14:12.640 of the comments was, well, it's too highly processed, right, 0:14:13.000 --> 0:14:15.440 And Ethan's retort was something like, yeah, have you been 0:14:15.520 --> 0:14:19.400 in an industrialized meat facility lately? Go in one of 0:14:19.400 --> 0:14:22.160 those if they even let you in the door, and 0:14:22.200 --> 0:14:24.600 then come in my plant and let's talk, because the 0:14:24.680 --> 0:14:31.480 reality is, yes, relative to a fresh picked squash and 0:14:31.680 --> 0:14:35.280 grinding your own lentils into a homemade veggie burger, like, 0:14:35.400 --> 0:14:38.440 of course, that's always going to be better relative to 0:14:39.200 --> 0:14:40.920 probably make some enemies on this. I'm not going to 0:14:41.120 --> 0:14:43.920 try to use specific names, but there's a few big 0:14:44.000 --> 0:14:48.520 food service companies that sell these patties that are everywhere 0:14:48.560 --> 0:14:52.520 right there, every college, high school, most fast food restaurants 0:14:52.640 --> 0:14:56.680 use these frozen patties that are not food. The amount 0:14:56.720 --> 0:14:59.080 of meat in them is questionable. The fillers the way 0:14:59.120 --> 0:15:01.160 they do that. Then you start to work your way 0:15:01.160 --> 0:15:03.960 down the meat supply chain. How are they treated, what 0:15:04.040 --> 0:15:07.400 kind of antibiotics are they pumped with? Where they raised? 0:15:07.520 --> 0:15:11.440 Then you talk economically, we're subsidizing the water, we're subsidizing land, 0:15:11.480 --> 0:15:15.080 we subsidize the corn that is a disaster. So you're 0:15:15.120 --> 0:15:19.360 talking about, in my mind, is a massive relative improvement. 0:15:19.880 --> 0:15:23.480 It's massive. Now. My recommendation with people it is, have 0:15:23.600 --> 0:15:25.800 it once a week, you know, have it occasionally, right, 0:15:25.960 --> 0:15:30.400 Substitute a hamburger, occasionally, substitute some fish occasionally. For this, 0:15:30.480 --> 0:15:35.200 it's a it's a delightful, healthy alternative relative to other 0:15:35.280 --> 0:15:39.280 things on one's journey to a better way of eating. 0:15:39.720 --> 0:15:41.920 That's so interesting. I think a lot about this of 0:15:42.040 --> 0:15:45.360 relative versus absolutely does something need to be perfect and 0:15:45.440 --> 0:15:47.920 solve every single problem out there? Or does it just 0:15:48.080 --> 0:15:51.080 need to move us in the right direction? Progress not perfection, 0:15:51.240 --> 0:15:54.600 Progress not perfection. I like that line on that note. 0:15:54.800 --> 0:15:56.880 Is the product as good as it could be? Yet 0:15:57.120 --> 0:15:59.880 is there room for more improvement? Can you make the 0:16:00.040 --> 0:16:02.320 beyond burke or even better? Yeah? Absolutely. I Mean these 0:16:02.360 --> 0:16:04.880 guys are tweaking day in and day out, and I 0:16:04.920 --> 0:16:08.120 think making major improvement. I know they're looking at alternative 0:16:08.280 --> 0:16:11.960 protein sources. We as a fund are working closely with 0:16:12.040 --> 0:16:15.680 them to actually use credible data to measure and think 0:16:15.720 --> 0:16:18.640 about their impact. Is you want to talk about things 0:16:18.680 --> 0:16:24.480 like carbon emissions, water utilization, land utilizations, there's no comparison. 0:16:24.520 --> 0:16:29.160 You're talking one hundred x improvement with something like that, 0:16:29.400 --> 0:16:32.480 but they're going beyond that. What's interesting is that the 0:16:32.520 --> 0:16:35.600 traditional meat industry has had a response to this that 0:16:35.760 --> 0:16:38.400 is unlike what the dairy industry did in the sense 0:16:38.480 --> 0:16:41.040 that the dairy industry didn't see this coming right and 0:16:41.080 --> 0:16:44.480 they've lost share to these alternative milk products and been 0:16:44.520 --> 0:16:47.880 caught flat footed, and the meat industry is responding differently. 0:16:48.200 --> 0:16:50.440 Do you think they learned a lesson from dairy? I 0:16:50.480 --> 0:16:52.920 have the good fortune to engage with a number of 0:16:53.120 --> 0:16:55.840 very very very senior executives at many of the food 0:16:55.920 --> 0:16:58.920 beverage companies, including some of the meat companies. They're rational, 0:16:58.960 --> 0:17:01.800 smart people. Most of them want to do the right 0:17:01.840 --> 0:17:03.800 thing and are trying to figure out how to navigate it. 0:17:04.000 --> 0:17:06.760 You know, they have a shareholder base, they have self interest. 0:17:06.800 --> 0:17:09.360 All those things are aligned, and I think they're rational. 0:17:09.400 --> 0:17:12.439 They recognize and see these trends and are afraid of 0:17:12.520 --> 0:17:15.720 getting caught flat footed, and so yeah, they've seen other 0:17:15.760 --> 0:17:18.679 industries blow up, other companies blow up, and I think 0:17:18.760 --> 0:17:21.399 they know it can happen to them too. Do you 0:17:21.480 --> 0:17:24.240 ever get out there and taste competitors products, just in 0:17:24.320 --> 0:17:26.359 knowing you're not an investor anymore? But I mean, if 0:17:26.359 --> 0:17:28.199 you eat a beyond Burger, can you tell it's not 0:17:28.240 --> 0:17:31.040 an impossible burger? Can you absolutely? And you can tell 0:17:31.080 --> 0:17:34.320 it's not an incognito whatever? Whatever? Okay, those couple ones, 0:17:34.359 --> 0:17:36.920 at least they're pretty distinct, and distinction is good. And 0:17:36.920 --> 0:17:38.520 you know, one of the points, one of our thesis 0:17:38.880 --> 0:17:42.119 in general is competition builds categories. Right, it's you know, 0:17:42.200 --> 0:17:44.560 beyond meat. A loan would not be where it is 0:17:44.600 --> 0:17:47.280 if there wasn't impossible. That's just how these things work, 0:17:47.480 --> 0:17:50.280 because one spurs the other to be better, to do better, 0:17:50.359 --> 0:17:53.640 and people talk about it. They compare retailers here about 0:17:53.640 --> 0:17:57.320 a consumers reporters. Everybody's talking about it. It sort of 0:17:57.320 --> 0:17:59.600 creates this hype in interest and they support each other's 0:17:59.600 --> 0:18:02.600 funder compete, and it just sort of creates an ecosystem. 0:18:03.280 --> 0:18:06.359 Back to this notion with Zico, you did eventually sell 0:18:06.400 --> 0:18:10.200 to Coke Beyond me. It's took an investment from Tyson, right, 0:18:10.440 --> 0:18:12.320 and so did you think and then Tyson ended up 0:18:12.320 --> 0:18:15.199 selling and launching its own competitive product. How did you 0:18:15.200 --> 0:18:18.680 think about that? Help them navigate that based on your experience, 0:18:18.800 --> 0:18:21.520 What are the pros and cons of letting your monster 0:18:21.640 --> 0:18:25.000 competitor into what you're doing, knowing that they can then 0:18:25.119 --> 0:18:27.040 take that and go off and do their own thing. 0:18:27.119 --> 0:18:30.399 It's a very delicate balance. And to be really clear, 0:18:31.200 --> 0:18:33.000 our role, in my personal role and beyond me, it 0:18:33.000 --> 0:18:36.120 has been relatively minor, you know, very very close with 0:18:36.160 --> 0:18:38.760 Seth and Ethan, but they've got some great counsel on 0:18:38.800 --> 0:18:40.960 our great advice. But I'll tell you the way we 0:18:41.119 --> 0:18:43.560 generally approach this with a variety of companies and the 0:18:43.640 --> 0:18:47.040 kind of conversations we had with them, which is, look, 0:18:47.240 --> 0:18:50.159 ultimately it's about where you're going, what's your individual and 0:18:50.200 --> 0:18:53.280 company mission and objective, and how do you define success. 0:18:53.359 --> 0:18:56.720 So we encourage entrepreneurs to be comfortable with the fact that, look, 0:18:56.800 --> 0:18:58.879 do you want to grow this and run this forever 0:18:58.920 --> 0:19:00.600 and pass it down to your kids? Do you want 0:19:00.600 --> 0:19:03.120 to scale across the world. Do you want to make 0:19:03.119 --> 0:19:05.159 some money, retire and go start a nonprofit? Do you 0:19:05.320 --> 0:19:06.399 know what do you want? What do you want to 0:19:06.400 --> 0:19:09.000 get out of this? And I think Ethan had a 0:19:09.040 --> 0:19:12.040 big vision for this from the beginning. He wanted to 0:19:12.080 --> 0:19:15.960 change the world. And so given that and given the 0:19:16.000 --> 0:19:17.679 industry and the way they were operating, it was going 0:19:17.720 --> 0:19:20.440 to take a lot of capital. And so they raised 0:19:20.480 --> 0:19:23.119 a lot of money from some big professional investors, and 0:19:23.160 --> 0:19:25.639 we felt fortunate to be able to support multiple times 0:19:25.640 --> 0:19:30.000 along the way. But this Tyson conversation, along with other strategics, 0:19:30.080 --> 0:19:34.320 is a delicate one. Yes, Typically, if an entrepreneur is 0:19:34.400 --> 0:19:38.880 expecting that relationship to solve all their problems, they're wrong. 0:19:39.960 --> 0:19:43.359 So it's not their expertise. Rarely can they bring that, 0:19:43.800 --> 0:19:47.240 And rarely do entrepreneurs have the capability or sophistication and 0:19:47.359 --> 0:19:49.480 know how to manage that right. It takes a very 0:19:49.520 --> 0:19:53.000 sophisticate entrepreneur to understand the way a corporation works and 0:19:53.040 --> 0:19:57.840 how to garner resources and engage. So every major food 0:19:57.840 --> 0:20:00.840 company on the planet right now is at this world 0:20:00.880 --> 0:20:02.840 trying to decide if they're in it. Does it make sense? 0:20:02.840 --> 0:20:04.719 Should they be in it? They have the right to 0:20:04.720 --> 0:20:06.880 be in it. Can they pull it off? They're all 0:20:06.880 --> 0:20:10.040 looking at it. It's a complicated set of issues and 0:20:10.160 --> 0:20:12.400 nuance that you then have to decide sort of pick 0:20:12.440 --> 0:20:15.760 your path forward. You tell me how unique this is. 0:20:16.080 --> 0:20:19.159 But one fascinating dynamic to this industry to me is 0:20:19.160 --> 0:20:21.800 you almost want your competitor's products to be really good. 0:20:22.080 --> 0:20:24.040 Because if what you're trying to do is not go 0:20:24.119 --> 0:20:26.440 after a niche, but you're trying to change the way 0:20:26.440 --> 0:20:30.840 people think, mainstream consumers think about plant based alternatives, then 0:20:30.880 --> 0:20:33.440 you want everyone who picks up a plant based alternative 0:20:33.480 --> 0:20:35.760 to have a really good experience with it, because then 0:20:35.800 --> 0:20:38.720 they're a potential, they're a new customer. Whereas if they 0:20:38.720 --> 0:20:41.200 have a bad experience, even with a competitor's product, they 0:20:41.240 --> 0:20:44.280 may say, yeah, not doing this again. You kind of 0:20:44.320 --> 0:20:47.080 want your competitor's products to be good. Maybe not quite 0:20:47.119 --> 0:20:49.520 as good as yours, but good, right am I right 0:20:49.520 --> 0:20:52.760 about that? You, my friend, have the intuition of an entrepreneur, 0:20:53.119 --> 0:20:56.640 and this is something very few people get. I run 0:20:56.680 --> 0:21:00.480