A new crop of veggie burgers is fooling carnivores — and Wall Street is licking its chops.
On Wednesday, Beyond Meat — a startup whose plant-based patties are available at Whole Foods, Kroger and eateries like TGI Friday’s and Carl’s Jr. — priced its initial public offering at $25 a share, well above initial pricing of $19 to $21 a share, as investors positioned themselves to gobble up the stock.
Veggie-patty archrival Impossible Foods got a boost on Monday when Burger King said it will roll out an “Impossible Whopper” nationwide this year after testing it for less than a month at just 59 restaurants in the St. Louis area.
Such enthusiasm for what is basically a vegetable is nearly unprecedented in the food industry — and insiders say it’s because the new fake-beef engineering is revolutionary.
“People have wanted a veggie burger that tasted good for years, but the technology simply wasn’t there,” said restaurant analyst Mark Kalinowski. “That’s changed now.”
The new beeflike veggie burgers are now raising hopes in the fast food industry, which has been plagued by sagging sales as consumers gravitate toward healthier diets.
While Beyond Meats makes its patties from pea proteins and beet juice, Silicon Valley-based Impossible Foods uses a molecule from real beef called heme that’s also found in soybean roots. In both cases, the burgers not only taste like real meat but also have the same, slightly gristly and fatty texture — and even bleed if they’re cooked rare.
Impossible Burger honchos claim that its restaurant customers have experienced “double-digit increases in store traffic” since they began selling the burgers. And most of the traffic is coming from carnivores who are willing to fork over more dough — an additional $1 — for the plant burger than for its beef counterpart.
Consumer appetites for the new patties have been so strong that Impossible Foods on Wednesday admitted to supply shortages nationwide that could last for the “next several weeks.”
That’s a far cry from the veggie patties that for decades have been made from soy, black beans, tofu and grains — leaving most meat eaters less than impressed.
Eight years ago, McDonald’s yanked veggie burgers off its menu because each of its restaurants only “served four a day” on average, then-CEO Don Thompson admitted during a 2011 earnings call. Today, Thompson is an investor in Beyond Meat — and McDonald’s is testing a meatless patty in Europe that’s under development by Nestle.
Impossible meat items are now being sold at White Castle, Red Robin and Qdoba .
White Castle, a family-owned chain with a rabid following, admits it’s normally more cautious about introducing new menu items.
“We started in 1921 and didn’t add a slice of cheese until 1962,” said White Castle VP Jamie Richardson.
Beyond Meat is scheduled to trade on the Nasdaq on Thursday. Its $25-a-share pricing gives it a valuation of $1.5 billion.
