With avian flu killing egg-laying hens by the tens of millions, it's a bad time to be a chicken. But it's a very good time to be a company whose mission is to break the food industry's addiction to chickens.
Since 2011, Hampton Creek has been advancing the idea that replacing animal products with ingredients derived from plants is a way to make food healthier, cheaper, more environmentally friendly and even better-tasting. It's had some sizable wins in that time, most recently a massive contract with Compass Group, the world's biggest food-service company. But nothing compares to the surge in interest Hampton Creek has experienced since the new flu strain, H5, began laying waste to American farms in April.
With more than 47 million chickens destroyed to date, representing more than 10 percent of all egg-laying hens, demand for egg alternatives has been exploding, says CEO Josh Tetrick, an Inc. 35 Under 35 honoree last year. Food-industry executives who were once content to take a wait-and-see stance are suddenly desperate to get their hands on Just Mayo, Just Cookies, and even products the startup hasn't introduced yet. "It's hard to name a fast food chain or global retailer or manufacturer we haven't been on the phone with or corresponded with by email," Tetrick says. "We were growing pretty fast before this thing happened, but it's amplified everything across the board."
It's amplified things so much, in fact, that Hampton Creek is projecting its revenue run rate will rise from $48 million now to $120 million by next January. Tetrick believes that will make it the fastest-growing food company ever, although he's quick to note that Hampton Creek considers itself a tech company, not a food company.
To cope with the demand, the startup is adding two more manufacturing facilities to the five it has up and running already; it's pushing the launch of its liquid-egg product, Just Scramble, up to November, and its pancake batter and ranch dressing releases up to July; and it has hired a handful of temporary employees just to answer all the incoming phone calls. "The place is buzzing," Tetrick says.
He quotes expert predictions that it will be a full year before American egg production returns to its previous level. "We have 12 months to run faster than any company has ever run," he says. "We can have the impact we actually want now. Nothing is stopping us."
Tetrick calls the avian flu crisis a "black swan event" and notes that it's not the company's first. The previous one happened when Unilever sued to stop Hampton Creek from calling its mayonnaise product "Just Mayo," arguing that it constitutes mislabeling. Unilever ended up dropping the suit, but only after the startup reaped what it calculated to be $21.5 million in free media exposure "and a chance to tell our story over and over again," says Tetrick.
That David-and-Goliath episode offered the satisfaction of an idealistic little guy defeating a corporate behemoth. The bird flu epidemic is a little different, hurting both farmers and consumers. Crowing about the profits it generates could therefore come off as a little unseemly, and Tetrick knows this. "Of course no one roots for avian flu, but it's a moment in time where there's a schism in the food system," he says. "It's an indicator of brokenness, of absurdity.
"Avian flu is a set of headlines. It's an unfortunate thing that's happening," he adds. "Headlines go away. They have a way of working themselves out. But what doesn't have a way of working itself out is how screwed the current system is. This is a unique moment in time where we can drive real fundamental change into the food system at hyperspeed."