On May 2, US time, Beyond Meat (BYND), known as the "first stock of artificial meat ", officially landed on the Nasdaq market. The Beyond Meat price is $46 after opening, an 84% premium to the issue price of $25. Subsequently, the stock price continued to rise, rising to $65.75 at the close, an increase of 163% from the issue price, setting the best performance of US stock IPOs since the financial crisis. After the market closed, Beyond Meat's share price rose 4.49% again. Currently, Beyond Meat has a market capitalization of US$3.8 billion.
(Source: Futuniu Niu )
Beyond Meat became famous for this. According to data, Beyond Meat is a startup for artificial meat. Investors behind the company include Bill Gates, Don Thompson, former CEO of McDonald's , and Hollywood movie star Leonardo ? DiCaprio, Tyson Foods, the largest meat producer in the United States. What exactly did Beyond Meat win the favor of celebrities and market investors?
Beyond Meat and artificial meat
Beyond Meat are also known as "super meat" companies in China. Literally speaking, Beyond Meat means "outside meat" or "not just meat" - this can roughly draw the company's business direction and business philosophy.
According to public information, Beyond Meat was founded in 2009 by founder Ethan Brown. It is headquartered in Los Angeles and mainly produces vegetable artificial meat. In 2013, Beyond Meat's products were launched in retail food supermarkets across the United States. In May 2016, Beyond Meat launched its first artificial meat burger. At present, Beyond Meat's artificial meat products are available in many restaurants and supermarkets in the United States, Canada, the United Kingdom, Italy and Israel. Beyond Meat's current artificial meat products can replace chicken, beef and pork sausages. In a letter to shareholders, Ethan Brown, founder and CEO of the company, said that Beyond Meat originated from his childhood and his family at the West Family Farm with his family. The days of wandering in the farm and living with poultry at a young age gave Ethan Brown the idea of whether he could produce meat without slaughtering poultry.
(Source: Beyond Meat official website)
Finally, in 2009, Beyond Meat came into being. Ethan Brown said that in fact, humans are currently facing the entanglement of eating meat and not eating meat, not necessarily a multiple-choice question. He believes that the solution to the problem - artificial meat is a new direction for future farmers' production, and the achievements that humans may achieve in this direction may even surpass the last century. Now, the development of artificial meat only requires "change of concepts" and the use of combined technology.
The concept of "artificial meat" may be relatively unfamiliar to many people. According to Baidu data, artificial meat is mainly divided into two types: "soy artificial meat" and "animal stem cell artificial meat". Soy artificial meat is actually used to imitate the shape and taste of meat with soy protein , while animal stem cell artificial meat is cultured through sugar, amino acids, oils, minerals and a variety of nutrients, so that stem cells eventually become meat.
The above mentioned that the vegetable artificial meat produced by Beyond Meat actually refers to "soy artificial meat", that is, all artificial meat in Beyond Meat is actually made from plants.
Beyond Meat performance
Of course, to gain the favor of so many investors, it is not enough to just tell beautiful stories, but also to have excellent company performance support.
According to the company's prospectus, Beyond Meat's revenue has achieved a significant increase in revenue from the latest disclosed first quarter 2019 revenue.
(Source: Beyond Meat Prospectus)
In the first quarter of this year, Beyond Meat achieved revenue ranges from US$38,000 to US$40 million, with low and high values increasing by 197% and 213% respectively during the same period. If the distribution channels are divided, the revenue growth rate of the Things Services segment is higher than 450%. According to the platform, the revenue of fresh food platform also increased by about 300% year-on-year.
However, with rapid revenue growth, the company still recorded losses for years. Judging from the prospectus, Beyond Meat incurs huge operating expenses and product sales costs every year. Moreover, the annual growth rate of these expenses has a trend of expanding. In 2018, the cost of selling products accounted for 80% of revenue, while in 2017 it accounted for 94%.The company stated that the cost mainly includes raw materials and product ingredients costs, labor costs, supply costs, packaging and transportation costs, etc.
(Source: Beyond Meat Prospectus)
In addition, the operating expenses incurred during the reporting period are mainly investments in expanding customer base, supplier network, co-production partners, expanding marketing channels and distribution and production equipment. The company expects that this part of the expenditure will continue to increase significantly in the future, and the growth rate may be higher than expected. Therefore, Beyond Meat also said that the growth in revenue and gross profit margins may not keep up with the growth rate of expenditures in the future, and Beyond Meat may continue to maintain losses. In fact, since its inception, Beyond Meat has been losing money every year.
In addition, Beyond Meat is also overly dependent on the sales of its flagship product Beyond Burger. In 2018, Beyond Burger's sales accounted for 70% of the total revenue that year. For the future, the company expects that Beyond Burger product sales will still account for a large part of the company's revenue, revenue and cash flow. Once Beyond Burger sales drop, the company's performance will be significantly affected.
If sufficient financing is not obtained, excessive costs and operating expenses under the current circumstances will limit the company's development in the future. Beyond Meat urgently needs to get rid of the current dilemma of increasing revenue but not increasing profits.
Follow the richest man to buy a villa by the sea?
In 2013, after trying Beyond Meat a meatless chicken roll, Bill Gates decided to invest in Beyond Meat. Gates was surprised to find that these artificial meats clearly did not even have any chicken, but they had the taste and taste of real chicken, and the difference was not visible to the naked eye.
According to Nielsen statistics, as of January 5 this year, the sales of artificial meat in supermarkets in the United States were US$878 million, an increase of 19.2%. More and more people, like Ethan Brown, switch to artificial meat out of concerns about animal life and environment. Therefore, artificial meat is also called the "new trend" in the food industry. There are many profit-seekers under the hierarchy of
. In the past year alone, dozens of alternative protein production companies with similar concepts were established in the United States. However, the industry is at a hot spot, which will also make competition fierce. Currently, Beyond Meat rivals include not only other vegetable-made meat producers, Impossible Foods, Gardein and Field Roast, but also traditional meat producers that have been eroded by the market. Olivia Fox Cabane, chairman of the International Alliance for Replacement of Protein, said that under the current trend, there are two or three investors standing behind every alternative protein production company seeking financing. Dan Altschuler Malek, investment partner at New Crop Capital, said that for investors, taste is the primary factor that makes them decide to invest in artificial meat products, and the price is second.
Bill Gates chose Beyond Meat because of the vents of artificial meat and its taste. Will other investors in Nasdaq believe in the judgment of the richest man and continue to be optimistic about Beyond Meat?
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