5e9897ffd50ebc2de7659302 Burgerimpossible

Your Mission: Impossible Foods

Before going into new business, we must issue a minor correction, with thanks to the astute readers who pointed it out to us. Last week, we told you in detail about the exciting prospects of Topgolf Entertainment Group, and then wrapped things up by encouraging you to get in touch if you are interested in learning more about Palantir Technologies. While we at Iron Edge are proud to provide access to both of these fine companies, the apparent sharp turn was unintentional. It was not a classic “bait-and-switch” … It was more of a faulty “cut-and-paste”.

 Now for this week’s featured company… and it is an appetizing one. Impossible Foods, Inc. was founded in 2011. The company’s headquarters are in Redwood City, California. Impossible’s mission (and henceforth we will do our best to avoid those Mission: Impossible puns) is to provide plant-based meat substitutes that are virtually indistinguishable from the real thing. Their aim is to make something that tastes exactly like meat and retains its nutritional value. They do so by analyzing animal products all the way down to the molecular level, then matching specific proteins and nutrients that are found in plants. This is an advancement light years beyond taking soybeans and squishing them into a patty and calling it a hamburger: Impossible Foods meticulously re-creates the experience of tasting that hamburger through exhaustive laboratory research.

 Impossible Foods was started by a Stamford biochemistry professor named Patrick Brown. He had identified intensive animal farming as the world’s greatest environmental threat, and he wanted to confront the issue head-on. Concluding that the best way to reduce animal agriculture was to put an alternative on the market, Brown went to work on creating “meat” from plants. In other words, Impossible Foods has its origins steeped in social responsibility.

 Launched in July 2016, Impossible’s signature product is the Impossible Burger. According to the company, making an Impossible Burger uses 95% less land and 74% less water, and it emits about 87% less greenhouse gas than is produced during the traditional cow-oriented patty-producing process. The plant-based burger has no cholesterol and fewer calories than beef hamburger patties. Impossible Burgers are said to pack more protein and contain less total fat than their beef counterparts. Early this year, Impossible upgraded its flagship offering to “the Impossible Burger 2.0”, with improvements to taste, texture and nutrition. The new product contains 30% less sodium and 40% less saturated fat than the earlier recipe, and as much protein as 80/20 ground beef from cows. By replacing wheat with soy protein, they also made the new product gluten free. Impossible Burgers also enjoy approval across religious sectors with both Kosher and Halal certification.

 A huge stride, and a highly visible one for the Impossible Burger, took place last April when Burger King began offering the patties in its Whoppers. The pilot program quickly graduated from a regionally focused test in Burger King’s St. Louis area restaurants to a nationwide rollout that started this month… CNBC covered the move in this video. The venture has been met with almost universally favorable reviews. Nobody, it seemed, could even tell the difference between the plant-made “meat” and the real deal. Impossible Foods was experiencing heightened name recognition, and now the company’s biggest issue seems to be the challenge of keeping production in pace with demand. This is undeniably a “good problem” to have!

 Impossible Foods is most broadly known for these burgers, but they have also created a sausage product that is featured on some Little Caesar’s pizzas. The Impossible Supreme pizza can now be found in Florida, New Mexico, and Washington state. The sausage product was the result of going back to the lab to basically start from scratch… studying meat “behaviors” on the molecular level and replicating them with similar plant molecules. The repeat success has, of course, inspired the company to scale further. Brown has made it known that Impossible Foods is presently working on “whole cuts of beef”, including steak. If they can accomplish for steaks what they did for burgers, consider the game changed.  

 Looking farther, consider the prospect of improving on steaks, burgers, and sausage. Then why not add bacon, chicken, pork chops, and hot dogs to the list? While this might sound utterly blasphemous to proud carnivores, one cannot deny the wide range of possibilities. Imagining ways to offer veal and lamb products without the associated guilt that many feel could open the doors to a tremendous worldwide demographic. Your friends at Iron Edge VC do not have a dog in this fight. Whether people like to eat meat or not is not our business. What is our business is looking at the factors that might determine a pre-IPO company’s success, and the scalability inherent in Impossible Foods is quite appealing.

 Impossible’s primary competitor is Beyond Meat (BYND). That company is known for its intensely volatile, and mostly upward-moving, stock price activity since its May 2019 IPO. Beyond was priced at $25, went up a jaw-dropping 856% to $239, and as of today has settled in around $150. It is very important to bear in mind that this is very unusual trading activity, that these are two entirely different companies, and that past performance is not a reliable indicator of future results. Still, BYND’s freakish action at least points to the public appetite for this burgeoning industry.

 We at Iron Edge VC are proud to have pre-IPO access to IMPOSSIBLE FOODS, INC. shares. If you would like to learn more, or if you know of anybody else who would, please do not hesitate to contact us by clicking “Get in Touch” below.

This is a very time-sensitive issuance, so if you choose to invest in Impossible Foods, we request that you let us know right away. As always, shares are available on a first come, first served basis.

5f6e0d464e388c4975685025 Paul Min

Paul Maguire

Founder And Managing Partner