(Veteran tech columnist Jon D. Markman publishes Strategic Advantage, a vibrant guide to investing in the digital transformation of business and society. Click here for testing.)
An Israeli company has developed technology to 3D print meat, and investors are scrambling to build a piece. This is the best way for investors to get a chair at the table.
Managers at Redefine Meat said Tuesday they raised $ 29 million from a consortium of global investors to use digital technology to create steaks that look, smell and taste like the real thing.
Investors should taste the sizzle, then consider buying Beyond Meat (BYND).
Innovative companies have long learned that they could use state-of-the-art 3D printers to make prototypes and low-output parts. The companies literally print the items in the same way that office workers use Hewlett Packard inkjets to convert pieces of digital information on a computer screen into a physical document. The process involves computing, some physical stock such as paper, and ink.
Ink is the tricky part for 3D printing food.
Engineers at Redefine use plant-based products similar to nutrients that cattle feed to “ink” printed steaks. This ink contains proteins from grains and legumes to visualize muscle texture, and other fats and acids to double the juice taste, blood structure and color of the real flesh.
While all of this may be too late and perhaps full, Redefine product managers have extensively tested the folds and won rave reviews in Israel.
The Times of Israel reported Tuesday that Best Meister decided to release Redefine’s results after Israeli food retailer’s blind surveys showed that 90% of testers couldn’t tell the difference from the real thing. Follow investors.
Hong Kong-based VC Happiness Capital, New York-based Hanaco Ventures, Guatemala-based Losa Group, Dutch-based Prime Ventures, Singapore-based venture capital firm K3 Ventures, and investor Jeremy Coller famous private all promised Redefine.
The goal is to drive a greater shift toward plant-based meat substitutes that have the potential to grow to a $ 85 billion market by 2030, according to an October report in the New York Times
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Past meat burgers
Beyond meat
For now, investors should focus on Beyond Meat. The company was based in El Segundo, Calif. A hot public offering in May 2019. Shares were cut at $ 25 and quickly burned up to $ 65.75, a 135% opening day gain. Within a year the stock reached $ 240 for a market capitalization of $ 14.8 billion.
That valuation is far out of the ordinary for food businesses. Beyond Meat then traded as it is now as a technology company. Investors bought into the big idea that Beyond is blaming a new path in diet. The idea is to move the needle slowly in the $ 11.7 trillion global food industry.
From the beginning of the company he invested heavily in scale and human resources. Managers used the product of the IPO to build supply chains, and Sanjay Shah, the Amazon.com logistics veterans joined Beyond in September 2019 as chief operating officer. Within a year he had distribution contracts Walmart
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(WMT), Targets
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(TGT) and the leading grocery companies in Canada and Europe.
Outside officials also began courting the fast-service restaurant business. Companies like it Carl’s Jr., Del Taco and Dunkin ‘Donuts will present the results of Beyond. And in January the company announced an agreement with Pepsico
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( (PEP) – Get Report) to co-develop plant-based proteins for snacks and beverages.
Today company managers say Beyond Meat products are available in 112,000 grocery stores, restaurants, hotels and universities.
Makes sense. A cow is largely just a device that turns grass into meat through gastronomic chemistry. Beyond just past the middle one.
Following third-quarter financial results in November last year, Ethan Brown, chief executive, refused to pull off aggressive expansion plans. He also noted that sales growth accelerated by 63% year over year despite the pandemic. Sales speed, a food industry metric that measures sales over distribution points, was 3.5x higher than the industry average.
This is important because sales speeds generally decline as businesses add spread points.
Beyond Meat is the sex killer in plant-based proteins, the fastest growing part of the food service ecosystem.
This space will only grow as innovative companies like Redefined Meat make headlines with printed steaks and other meat-like products.
Shares will trade beyond sales at 27.3x and 933x onwards, although there is no relevant profit at this stage of the growth cycle. Based on sales growth alone the stock should trade back to the mid $ 200s, a 44% gain from the current price of $ 173.04.
Beyond investors can buy shares to any weakness.