Business
How Beyond Meat is trying to get its sizzle back
When Beyond Meat went public in 2019 in an initial stock offering that saw its shares nearly triple in price, it seemed to confirm that plant-based meats had arrived.
The food technology, capable of converting beans into something approaching meat in taste and appearance, caught the imagination of the public, restaurant chefs and media alike. Deals with fast-food chains and soaring sales during the pandemic seemed to only underscore how a once-fringe idea had gone mainstream.
But those heady days are over as industry sales have fallen amid concerns about the healthfulness of plant-based meat, a sticker price that remains higher than a basic burger — and the fact that the product still only approximates the real thing.
“We thought we were just gonna go from our meteoric rise into the mainstream and not have to deal with this cycle that we’re in,” said Beyond Meat founder and Chief Executive Ethan Brown, in an interview at the company’s new El Segundo offices. “The trough has been a difficult place to be the last couple of years.”
Now the company is betting it can turn around its fortunes with a newly formulated burger that it says not only is a big leap in taste, but has won the seals of approval of leading health and nutrition organizations.
“I give credit where it’s due. I think they’ve made some clear improvements in the ingredients and nutritional profile, so there’s clear progress there,” said John Baumgartner, an analyst at Mizuho Securities, who has had an “underweight” rating on Beyond’s stock.
As the first plant-based meat company to go public, Beyond has been an industry bellwether, with its travails documented in the media and regulatory filings.
Though the company’s growing lineup, including breakfast patties, beef tips and chicken tenders, are sold at 130,000 retail and food service outlets worldwide, some of its heralded fast-food deals with companies such as Carl’s Jr., Dunkin Donuts and KFC have either petered out or not moved beyond test phases.
It’s also faced stiff competition from chief rival, Impossible Foods in Redwood City, Calif., which has made fast sales gains at supermarkets and is available as a Whopper at Burger King.
Beyond’s net revenue fell by more than 25% to $343 million in 2023 compared with 2021. Sales decreased another 18% in the first quarter of this year, with the company racking up $54 million in losses.
With numbers like that, investors have taken a beating. The stock is down more than 90% since its all-time highs topping $200 in 2019. Shares closed Thursday at $7.35.
The sales decline has taken a sharp financial toll, with the company’s cash position falling from $733 million in 2021 to $190 million last year.
That prompted TD Cowen in a May earnings note to say the company may run out of money if it can’t stem the bleeding or raise funds — an outcome Brown dismisses. In Beyond’s quarterly conference call, the chief financial officer talked about raising funds through either debt or equity.
“It’s challenging,” Baumgartner said. “The category is still trying to find its way.”
Sales of plant-based meats and seafood were down 12% in 2023 to $1.2 billion, with unit sales falling even more by 19%, according to the Good Food Institute.
While the novelty of plant-based meat has worn off, what has stuck are persistent cries of “fake” or “faux” meat by critics — a diverse group that includes nutritionists, the entrenched meat industry and whole food absolutists who proselytize eating foods closer to nature.
The meat industry has for years helped bankroll a campaign highlighting the highly processed nature of Beyond’s and other makers’ plant-based beef products. “Fake meat, real chemicals,” is one such campaign sponsored by the Center for Consumer Freedom, a business backed nonprofit.
“Our campaign simply informed the public about what’s in fake meat. Consumers have seen past the marketing spin and realized that these products are just ultraprocessed goop that costs more and isn’t healthier than real meat,” said James Bowers, executive director of the center, in an emailed statement to The Times.
Beyond has tried to stress that all its ingredients come from plant-based sources, but there are many nutritionists on the web who also have voiced concerns about the fat and sodium content of the older burgers — and an industrial process that creates a product Grandma would not have stocked in her kitchen.
Baumgartner thinks those voices have resonated more than any industry-backed campaign.
Brown maintains entrenched food lobbies are the real culprit, while also acknowledging their effectiveness.
“So if you look at 2020, 50% or more of consumers thought that plant-based meat was healthy. That dropped to 38% in 2022. And it’s probably lower today,” he told The Times.
Beyond is banking its turnaround on the fourth iteration of its burger meat, which began wide distribution in May. Beyond has switched from canola and coconut oils to avocado oil, reducing saturated fat by 60% to 2 grams per serving, while cutting sodium by 20%.
Brown said the new recipe, which includes peas, red lentils, faba beans and brown rice, was developed through consultation with the company’s scientific and nutritional advisors, as well as leading health groups.
The new burger has earned key endorsements by the American Diabetes Assn. and Good Housekeeping that Beyond plans to slap on its labeling. The American Heart Assn. is including the product in its heart-healthy recipe collection.
Beyond also says its major recipe change has resulted in its “meatiest, juiciest” burger ever, citing early taste tests to back up its claim. That’s an important consideration, given the competition.
Impossible Foods, founded by a Stanford University biochemist, makes soy-based burgers, using a bean that has been manipulated by the food industry for decades to make an assortment of products. The company’s burgers also contain a genetically modified plant-based version of heme, an iron-containing molecule that is a component of beef.
In online taste tests, Impossible often beat Beyond’s burgers, which are based on peas. Brown chose peas due to alleged health concerns over soy-based products, the vast majority of which are genetically modified.
Impossible’s burgers became the darlings of foodies and chefs at high-end restaurants prior to pandemic, and since then, like Beyond, the company has continued to improve them, with multiple versions now available.
While both companies laid off workers amid the industry’s downturn, Impossible has seen strong retail sales and claims it is “the fastest growing meat from plants brand” in the country. It’s also managed to make its Impossible Whopper stick on Burger King’s menus. As a privately held company, it does not release detailed financial information.
Overseas, Beyond, which can market its product as non-GMO, sells in far more markets, and, though McDonald’s decided against selling a Beyond-based burger in the United States, it does so in Europe.
Despite how much is riding on its newest burger, Beyond has raised the retail prices, partially to offset the higher costs of the ingredients, but also to improve its margins.
Baumgartner questioned the move, especially after Beyond had cut the price of its prior burger.
“I think what complicates the matter now is in 2023, when you had inflation and you were seeing food prices going up, Beyond cut their prices. Now, as prices have generally stabilized, Beyond Meat is raising prices.”
Brown dismissed the concerns, saying the company needs to raise its margins after the prior price cut destroyed them, while doing nothing to improve sales.
While Brown’s goal has been to achieve pricing parity with animal meat, he said Beyond’s customers — health conscious and concerned about the environmental issues surrounding the beef industry — have been found to be “price insensitive.”
The fundamental challenge for Beyond, he said, is turning around the wider perception that its products are not good for you.
“Once that narrative became complicated for people because of misinformation or whatever, it became harder to grow the business. We have addressed that thoroughly in this product,” he said.
For the trendiest tenants in Hollywood office buildings, it’s the latest fad that goes way beyond designer furniture and art: mini studios
To capitalize on the never-ending flow of stars and influencers who come through Los Angeles, a growing number of companies are building bright little corners for content creators to try products and shoot short videos. Athletic apparel maker Puma, Kim Kardashian’s Skims and cheeky cosmetics retailer e.l.f. have spaces specifically designed to give people a place to experience and broadcast about their brands.
Hollywood, which hasn’t historically been home to apparel companies, is now attracting the offices of fashion retailers, says CIM Group, one of the neighborhood’s largest commercial property landlords.
“When we’re touring a space, one of the first items they bring up is, ‘Where can I build a studio?’” said Blake Eckert, who leases CIM offices in L.A.
Their studio offices also serve as marketing centers, with showrooms and meeting spaces where brands can host proprietary events not open to the public.
“For companies where brand visibility is really important, there is a trend of creating spaces that don’t just function as offices,” said real estate broker Nicole Mihalka of CBRE, who puts together entertainment property leases and sales.
Puma’s global entertainment marketing team is based in its new Hollywood offices, which works with such musical celebrity partners as Rihanna, ASAP Rocky, Dua Lipa, Skepta and Rosé, said Allyssa Rapp, head of Puma Studio L.A.
Allyssa Rapp, director of entertainment marketing at Puma, is shown in the Puma Studio L.A. The company keeps a closet full of Puma products on hand to give VIP guests. Visits to the studio sanctum are by invitation only, though.
(Kayla Bartkowski / Los Angeles Times)
Hollywood is a central location, she said, for meeting with celebrities, stylists and outside designers, most of whom are based in Los Angeles.
The office is a “creation hub,” she said, where influencers can record Puma’s design prototyping lab supported by libraries of materials and equipment used to create Puma apparel. The company, founded in 1948, is known for its emblematic sneakers such as the Speedcat and its lunging feline logo, and makes athletic wear, accessories and equipment.
Puma’s entertainment marketing team also occupies the office and sometimes uses it for exclusive events.
“We use the space as a showroom, as a social space that transforms from a traditional workplace into more of an experiential space,” Rapp said.
Nontraditional uses include content creation, sit-down dinners, product launches, album listening parties and workshops.
“Inviting people into our space and being able to give them high-touch brand experiences is something tangible and important for them,” she said. “The cultural layer is really important for us.”
The company keeps a closet full of Puma products on hand to give VIP guests. Visits to the studio sanctum are by invitation only, though. There’s no retail portal to the exclusive Hollywood offices.
Puma shoes are on display in the Puma Studio L.A.
(Kayla Bartkowski / Los Angeles Times)
Puma is also positioning its L.A studio as a connection point for major upcoming sporting events coming to Los Angeles, including the World Cup this summer, the 2027 Super Bowl and 2028 Olympics.
In-office studios don’t need to be big to be impactful, Mihalka said. “These are smaller stages, closer to green screen than a massive soundstage.”
Social media is the key driver of content created by most businesses, which may set up small booth-like stages where influencers can hawk hot products while offering discounts to people watching them perform.
Bigger, elevated stages can accommodate multiple performers for extended discussions in front of small audiences, with towering screens behind them to set the mood or illustrate products.
Among the tricked-out offices, she said, is Skims. The company, which is valued at $5 billion, is based in a glass-and-steel office building near the fabled intersection of Hollywood Boulevard and Vine Street.
The fashion retailer declined to comment on the studio uses in its headquarters, but according to architecture firm Odaa, it has open and private offices, meeting rooms, collaboration zones, photo studios, sample libraries, prototype showrooms, an executive lounge and a commissary for 400 people.
Pieces of a shoe sit on a workbench in the Puma Studio L.A.
(Kayla Bartkowski / Los Angeles Times)
The brands building studios typically want to find the darkest spot on the premises to put their content creation or podcast spaces, Eckert said, where they can limit outside light and sound. That’s commonly near the center of the office floor, far from windows and close to permanent shear walls that limit sound intrusion.
They also need space for green rooms and restrooms dedicated to the talent.
Spotify recently built a fancy podcast studio in a CIM office building on trendy Sycamore Avenue that is open by invitation-only to video creators in Spotify’s partner program.
“Ambitious shows need spaces that support big ideas,” Bill Simmons, head of talk strategy at Spotify, said in a statement. “These studios give teams room to experiment and keep pushing what’s possible.”
The rolling robots that deliver groceries and hot meals across Los Angeles are getting an upgrade.
Coco Robotics, a UCLA-born startup that’s deployed more than 1,000 bots across the country, unveiled its next-generation machines on Thursday.
The new robots are bigger, tougher and better equipped for autonomy than their predecessors. The company will use them to expand into new markets and increase its presence in Los Angeles, where it makes deliveries through a partnership with DoorDash.
Dubbed Coco 2, the next-gen bots have upgraded cameras and front-facing lidar, a laser-based sensor used in self-driving cars. They will use hardware built by Nvidia, the Santa Clara-based artificial intelligence chip giant.
Coco co-founder and chief executive Zach Rash said Coco 2 will be able to make deliveries even in conditions unsafe for human drivers. The robot is fully submersible in case of flooding and is compatible with special snow tires.
Zach Rash, co-founder and CEO of Coco, opens the top of the new Coco 2 (Next-Gen) at the Coco Robotics headquarters in Venice.
(Kayla Bartkowski/Los Angeles Times)
Early this month, a cute Coco was recorded struggling through flooded roads in L.A.
“She’s doing her best!” said the person recording the video. “She is doing her best, you guys.”
Instagram followers cheered the bot on, with one posting, “Go coco, go,” and others calling for someone to help the robot.
“We want it to have a lot more reliability in the most extreme conditions where it’s either unsafe or uncomfortable for human drivers to be on the road,” Rash said. “Those are the exact times where everyone wants to order.”
The company will ramp up mass production of Coco 2 this summer, Rash said, aiming to produce 1,000 bots each month.
The design is sleek and simple, with a pink-and-white ombré paint job, the company’s name printed in lowercase, and a keypad for loading and unloading the cargo area. The robots have four wheels and a bigger internal compartment for carrying food and goods .
Many of the bots will be used for expansion into new markets across Europe and Asia, but they will also hit the streets in Los Angeles and operate alongside the older Coco bots.
Coco has about 300 bots in Los Angeles already, serving customers from Santa Monica and Venice to Westwood, Mid-City, West Hollywood, Hollywood, Echo Park, Silver Lake, downtown, Koreatown and the USC area.
The new Coco 2 (Next-Gen) drives along the sidewalk at the Coco Robotics headquarters in Venice.
(Kayla Bartkowski/Los Angeles Times)
The company is in discussion with officials in Culver City, Long Beach and Pasadena about bringing autonomous delivery to those communities.
There’s also been demand for the bots in Studio City, Burbank and the San Fernando Valley, according to Rash.
“A lot of the markets that we go into have been telling us they can’t hire enough people to do the deliveries and to continue to grow at the pace that customers want,” Rash said. “There’s quite a lot of area in Los Angeles that we can still cover.”
The bots already operate in Chicago, Miami and Helsinki, Finland. Last month, they arrived in Jersey City, N.J.
Late last year, Coco announced a partnership with DashMart, DoorDash’s delivery-only online store. The partnership allows Coco bots to deliver fresh groceries, electronics and household essentials as well as hot prepared meals.
With the release of Coco 2, the company is eyeing faster deliveries using bike lanes and road shoulders as opposed to just sidewalks, in cities where it’s safe to do so. Coco 2 can adapt more quickly to new environments and physical obstacles, the company said.
Zach Rash, co-founder and CEO of Coco.
(Kayla Bartkowski/Los Angeles Times)
Coco 2 is designed to operate autonomously, but there will still be human oversight in case the robot runs into trouble, Rash said. Damaged sidewalks or unexpected construction can stop a bot in its tracks.
The need for human supervision has created a new field of jobs for Angelenos.
Though there have been reports of pedestrians bullying the robots by knocking them over or blocking their path, Rash said the community response has been overall positive. The bots are meant to inspire affection.
“One of the design principles on the color and the name and a lot of the branding was to feel warm and friendly to people,” Rash said.
Coco plans to add thousands of bots to its fleet this year. The delivery service got its start as a dorm room project in 2020, when Rash was a student at UCLA. He co-founded the company with fellow student Brad Squicciarini.
The Santa Monica-based company has completed more than 500,000 zero-emission deliveries and its bots have collectively traveled around 1 million miles.
Coco chooses neighborhoods to deploy its bots based on density, prioritizing areas with restaurants clustered together and short delivery distances as well as places where parking is difficult.
The robots can relieve congestion by taking cars and motorbikes off the roads. Rash said there is so much demand for delivery services that the company’s bots are not taking jobs from human drivers.
Instead, Coco can fill gaps in the delivery market while saving merchants money and improving the safety of city streets.
“This vehicle is inherently a lot safer for communities than a car,” Rash said. “We believe our vehicles can operate the highest quality of service and we can do it at the lowest price point.”
President Trump on Friday directed federal agencies to stop using technology from San Francisco artificial intelligence company Anthropic, escalating a high-profile clash between the AI startup and the Pentagon over safety.
In a Friday post on the social media site Truth Social, Trump described the company as “radical left” and “woke.”
“We don’t need it, we don’t want it, and will not do business with them again!” Trump said.
The president’s harsh words mark a major escalation in the ongoing battle between some in the Trump administration and several technology companies over the use of artificial intelligence in defense tech.
Anthropic has been sparring with the Pentagon, which had threatened to end its $200-million contract with the company on Friday if it didn’t loosen restrictions on its AI model so it could be used for more military purposes. Anthropic had been asking for more guarantees that its tech wouldn’t be used for surveillance of Americans or autonomous weapons.
The tussle could hobble Anthropic’s business with the government. The Trump administration said the company was added to a sweeping national security blacklist, ordering federal agencies to immediately discontinue use of its products and barring any government contractors from maintaining ties with it.
Defense Secretary Pete Hegseth, who met with Anthropic’s Chief Executive Dario Amodei this week, criticized the tech company after Trump’s Truth Social post.
“Anthropic delivered a master class in arrogance and betrayal as well as a textbook case of how not to do business with the United States Government or the Pentagon,” he wrote Friday on social media site X.
Anthropic didn’t immediately respond to a request for comment.
Anthropic announced a two-year agreement with the Department of Defense in July to “prototype frontier AI capabilities that advance U.S. national security.”
The company has an AI chatbot called Claude, but it also built a custom AI system for U.S. national security customers.
On Thursday, Amodei signaled the company wouldn’t cave to the Department of Defense’s demands to loosen safety restrictions on its AI models.
The government has emphasized in negotiations that it wants to use Anthropic’s technology only for legal purposes, and the safeguards Anthropic wants are already covered by the law.
Still, Amodei was worried about Washington’s commitment.
“We have never raised objections to particular military operations nor attempted to limit use of our technology in an ad hoc manner,” he said in a blog post. “However, in a narrow set of cases, we believe AI can undermine, rather than defend, democratic values.”
Tech workers have backed Anthropic’s stance.
Unions and worker groups representing 700,000 employees at Amazon, Google and Microsoft said this week in a joint statement that they’re urging their employers to reject these demands as well if they have additional contracts with the Pentagon.
“Our employers are already complicit in providing their technologies to power mass atrocities and war crimes; capitulating to the Pentagon’s intimidation will only further implicate our labor in violence and repression,” the statement said.
Anthropic’s standoff with the U.S. government could benefit its competitors, such as Elon Musk’s xAI or OpenAI.
Sam Altman, chief executive of OpenAI, the company behind ChatGPT and one of Anthropic’s biggest competitors, told CNBC in an interview that he trusts Anthropic.
“I think they really do care about safety, and I’ve been happy that they’ve been supporting our war fighters,” he said. “I’m not sure where this is going to go.”
Anthropic has distinguished itself from its rivals by touting its concern about AI safety.
The company, valued at roughly $380 billion, is legally required to balance making money with advancing the company’s public benefit of “responsible development and maintenance of advanced AI for the long-term benefit of humanity.”
Developers, businesses, government agencies and other organizations use Anthropic’s tools. Its chatbot can generate code, write text and perform other tasks. Anthropic also offers an AI assistant for consumers and makes money from paid subscriptions as well as contracts. Unlike OpenAI, which is testing ads in ChatGPT, Anthropic has pledged not to show ads in its chatbot Claude.
The company has roughly 2,000 employees and has revenue equivalent to about $14 billion a year.
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