On Thursday, May 2nd, 2019, alternative protein company Beyond Meat (BYND) will debut on the NASDAQ in a historic milestone for the plant-based movement.
The El Segundo, California based food innovator is just the latest in a trend of money-losing market disruptors to leave investors drooling. The company has so far raised roughly $240 million by selling 9.6 million shares at $25 each, bringing the valuation to $1.5 billion.
Currently sitting at 6 times sales price, this tells a completely different story than a first glance at it’s $29.9 million fiscal loss on an $87.9 million revenue for 2018.
But, because Beyond Meat’s goal is to disrupt the entire meat industry, with an altruistic view toward the future of our planet, I certainly don’t think that Beyond Meat’s current goal will be to turn the tide on a net loss in the near future. Instead, they will likely be injecting every single thing that they can into product innovation, distribution, manufacturing, and marketing in what is also becoming a deliciously poised (friendly) fight with their market rivals, Impossible Foods.
Impossible Foods entry into the food service industry first, rather than retail, indicated a slightly different strategic approach. This approach brings marketing and advertising costs down to almost zero, quickly making them an equal contender in a market in which Beyond Meat has a two-year head start. As the bout between the two heavyweight plant-based protein hitters heats up, it is good to remember, there is more than enough room for two in this town. When I think about the food service AND retail market for beef and how many competitors there are, it only goes to show that, if the goal is to overtake that means of production entirely, the competition has to be just as healthy and just as fierce. And although we are all on the same team, we must remember the rules by which the game is played in the marketplace. So to that end I say, although we are all on the same team, I am so excited to see these two battle it out for market share.
What this means for the investor is quite clear, don’t expect a return for a long time. But, if you’re like me, this is a good thing, because what is also crystal clear is a resounding and triumphant billow to the billions of animals being brought to slaughter every single year: “We’re coming to save you, and we’re bringing the stock market with us.”
At the publication of this article, Beyond Meat’s (BYND) current price is $25 per share and expected to open at $46.50. Very promising, if you can hold on.