The company that brought us Just Mayo, an eggless spread claiming to be healthier and better for the planet, has raised an astonishing large third round of capital. San Francisco-based Hampton Creek says the round totals $90 million, giving it enough juice to craft more alternative foods and to expand internationally.
Previous investors, Horizons Ventures and Khosla Ventures co-led the round, but other big names participated, too, like Marc Benioff, founder and CEO of Salesforce and Eduardo Saverin, co-founder of Facebook. Bryan Johnson, founder of Braintree, which was bought by PayPal, also ponied up. Non-tech big shots also invested including the Far East Organization, an industry pioneer of food and beverage products in Southeast Asia.
“I obviously feel good about having $90 million in the bank, but the most important part for us is — not the $90 million — but that it’s not from a faceless, nameless institution. It’s from people who can make us fundamentally better in so many ways,” said Hampton Creek Founder and CEO Josh Tetrick in an interview with GeekWire.
Tetrick said that Hampton Creek is easily misunderstood. It’s not only about making food healthier for the 1 percent who can afford it, but also about making food more sustainable, cheaper and better tasting for everyone.
“99.9 percent of food all of us eat in America and around the world is shitty for our body and degrading to the environment,” Tetrick said. “People are eating it because it’s cheap and it tastes good. Our vision is what is food look like if it is better for your body and tastes better and is a lot more affordable.”
The company’s first product, Just Mayo, sits on the shelf next to the regular mayo at major retail outlets, like Whole Foods, Walmart, Target, Costco, Safeway and Kroger. Internationally, it’s also made its way into PARKnSHOP, Hong Kong’s largest grocery store chain.
The most notable aspect to the spread is that it relies on plant-based alternatives instead of eggs, which Hampton Creek argues is better for the environment because of the amount of resources it takes to raise chickens and better for our bodies because of the cholesterol found in eggs. Other products Hampton Creek sells include Just Cookie Dough, which is now at Whole Foods, and Just Cookies, which are sold through a large distributor of food that serves cafeterias and hospitals around the country.
Next year, Just Pasta will be introduced to the market.
“Our focus isn’t on just taking out the egg, but to ask, what does making a better cookie mean? It means it is more affordable and tastes better. Then, we can ask what does it mean not to use any animal products, or how do we make it more healthy. We try to formulate it from the ground up,” he said.
For its third round, Hampton Creek reportedly was interested in raising $50 million at a $200 million valuation. The round easily exceeded those goals, although Tetrick declined to say what the company’s valuation is, adding “We feel pretty fortunate the market has recognized what we’ve done.” To date, the company has raised $120 million.
Early investors who are noticeably absent from the list are Ali Partovi and his twin brother Hadi, who are also backers of the Code.org project. In September, Ali abruptly resigned from Hampton Creek, after joining the company as chief strategy officer just a couple of weeks earlier.
“He still remains someone we have a ton of respect for,” Tetrick said, who said with any fundraising some investors may decide not to participate in later rounds.
Attempts to reach Ali for comment were unsuccessful.
Other named contributors: Bryan Meehan, Executive Chairman of Blue Bottle Coffee, WP Global, Jean Pigozzi, founder of LimoLand clothing, Nick Pritzker’s Tao Capital Partners, and Mustafa Suleyman and Demis Hassabis, co–founders of the Artificial Intelligence company, DeepMind Technologies, Collaborative Fund and Founders Fund.
Hampton Creek is also dealing with some push-back from incumbent food makers. In November, Unilever’s subsidiary Conopco filed a lawsuit in New Jersey against the startup, alleging false advertising and unfair competition because its product, “Just Mayo,” doesn’t contain eggs.
Tetrick said the company is still fighting those claims, but is optimistic the lawsuit will eventually be dropped. One silver lining from the legal battle is the publicity: “It got us quite a bit of free media and a chance to tell our story,” he said.
One of the company’s big supporters is Bill Gates, who has invested in the company through his involvement with Khosla Ventures, but he also named Hampton Creek as one of three companies shaping the future of food.
“I’ve had the opportunity to meet with him [Gates] a number of times to feed him some of our food and share our vision,” Tetrick said. “The biggest thing I took away from those interactions is that I’m so used to talking to people who are looking at their phones. Here’s this guy, who is probably 10,000-times busier than everyone I’ve ever met combined, and he was so focused, with an impenetrable stare. It was pretty cool to have him so interested in our story.”
Hampton Creek, which employs 62 people, says it will use the additional capital to invest in the science behind the recipes, but that about half of it will also go towards expanding to Western Europe and Asia.