Hampton Creek, a startup that’s creating plant-based alternatives to eggs, announced $US23 million in funding last month.
That brings the total funding to $US30 million from investors. Asia’s richest man, Li-Ka Shing, is an investor. As is the world’s richest man, Bill Gates. It also has investment from Yahoo founder Jerry Yang, Khosla Ventures, and the Founders Fund.
Today, the company announced that its egg-free mayo is being sold in Costco in Colorado. It also says that its mayo is the fastest-selling condiment in Whole Foods’ history.
The man behind the company is 34-year-old Josh Tetrick. This is his first company.
Prior to founding Hampton Creek, he was working for the U.N. in sub-Saharan Africa. He says he felt frustrated by his work because it was slow moving, and at times corrupt.
He was talking about his work with his best friend one day. His friend could hear his frustration. Together, they started talking about what Tetrick could do instead. Eventually, they ended up talking about the egg industry. From there, they landed on the idea of using plants to replace eggs.
Tetrick started reaching out to friends and friends of friends. Eventually he hooked up with some chefs to make a proof of concept. From there, he raised a seed round of funding. Then, he started hiring biochemists and food scientists. In a year and a half he had figured out how to make mayo and cookie dough that didn’t need eggs.
When he went to raise $US23 million last year, he used the following pitch deck. We got him on the phone to explain the deck, and run through the pitch that landed him millions.
Here’s how a first-time entrepreneur got the richest men in the world to open their wallets.
Tetrick says he likes to use Amazon as a starting point to frame the discussion. At its core, Amazon is a technology company, even though it does a lot of non-technological stuff like logistics. At Hampton Creek's core, it's a technology company that is exploring a better way to make food.
This is a reminder of where we currently get eggs. Tetrick calls it an 'antiquated technology.' If he's presenting to tech investors, he says this is like a 'horse and buggy whip.'
Tetrick says that Hampton Creek isn't targeted at people who care about saving the planet. It's for anyone who wants cheap, convenient, healthy food.
This is a video that shows what it's like in the Hampton Creek lab, which is a good reminder that this is a scientific company, not just a food company.
Hampton Creek is filled with scientists and other smart folks who left their high-paying jobs to come work a crazy mission to make plant-based eggs.
This slide isn't just about how the press talks about Hampton Creek. It's also about the conversation that's happening around food.
Now we enter the next phase of the presentation. Tetrick established the overall company; now he's going to dig into the market size.
The reason they have focused on the egg is that it's pervasive. It's in everything from mayo to cookies to even some car tires.
Mayo is to Hampton Creek what the book was to Amazon. It's a starting point. Mayo is a popular product that lots of people use, which makes it a good starting point for Hampton Creek.
Again, think of Amazon entering a lot of verticals. Similarly, Hampton Creek will go after other food groups like cookies and cookie dough.
For two years, Hampton Creek has been talking to food companies. These are the five big things it has learned.
Tetrick stresses that this isn't a company just for animal lovers. Even if you hate animals, as a capitalist searching for a more efficient way to do business, this has to drive you crazy. Eggs are wasteful.
Hampton Creek can help with food safety. Here in the U.S., this isn't a huge risk, but elsewhere in the world, it's a big threat. This slide shows what happened to Yum brands.
'Everything I said is complete bullsh*t if this (slide) isn't a fact,' says Tetrick. This is what Hampton Creek has that a traditional egg producer doesn't have. It has cost savings, and the hope is that over time the price will gap will increase.
Hampton Creek's scientists have looked at 3,000+ plants. They have identified 11 plants that are right for making the food products it wants to make.
This is an illustration of how tricky the plant science can be. There are two Canadian Yellow Pea species. But one varietal makes mayo, and another does not. Hampton Creek is digging through all the plants to figure out what works and what doesn't.
Here, Tetrick starts wrapping up his presentation. He reiterates that this is a big market. Hampton Creek is already in Whole Foods, and it's about to launch with Safeway in its delis.
And finally, Hampton Creek is developing a substitute for scrambled eggs. This is a video with Andrew Zimmern eating the scrambled eggs, saying that this is game changing. (Although he admits it's not quite perfect yet.)
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