More than a year after launching Crowd Cow, the startup with a mission of delivering quality beef to meat eaters through crowdfunding, founders Joe Heitzeberg and Ethan Lowry report that more and more cows are “tipping” and the business is growing rapidly.
The two veterans of the Seattle tech scene showed off their new business back in February, and explained how they were going to take the mystery out of meat by connecting people online to sustainably raised and processed beef in the Northwest. Since then, they’ve sold well over 100 cows and have opened up delivery to the entire West Coast.
Just a few weeks after soft-launching shipping to California, 38 percent of orders were coming from that state — an amazing feat considering it took nine months to reach that volume in Washington.
“Our grand ambitious plan for the next year is opening up for growth on the West Coast and then to the rest of the country,” Heitzeberg said. “We’ve got our own facility, we’ve got our own freezers in there, we’ve got the whole software platform we’ve created to help us actually scale up and we’re prepared for more scale than we’re doing now even. So we’ve got a whole process/quality control/supply chain in place so that we could actually grow quite a bit right now without really even having a hiccup with it.”
Heitzeberg said in order to go national, Crowd Cow will have to replicate what it’s doing on the sourcing and fulfillment side out West in at least one other geography that would allow them to handle the East Coast.
“Part of what we’re going through now is being two founders with a virtual office and no facilities to having a facility and having the machinery in place to grow,” Heitzeberg said. “Now we’re shifting the weight and it’s going to be all about growth and not so much about proving out the business — we think we have a business, it’s time to build the team a little bit and all that stuff.”
Beyond seeing their deliveries reach further destinations, the growth of the business is becoming evident in other ways.
“Joe and I are no longer the people actually packing beef, so that’s been a nice perk,” Lowry joked.
Spreading the word has been part of the growth process as well. Heitzeberg said crowd funding a cow is a “funny story” and has caught the attention of media as far away as the Czech Republic, for instance. But until recently, they had to take the story to their own backyard, in Portland, by getting on the phone and calling people they knew.
Word is out among ranchers, too, as beef suppliers get more familiar with what Crowd Cow is looking for and eventually providing by working with top-notch producers and artisanal butchers.
“What’s funny on the ranch front is we’re starting to get ranchers, they contact us pretty regularly now and say, ‘Hey, I would like to have my beef on Crowd Cow,'” Lowry said. “In the first six months, we would call them and nine out of 10 ranchers would say, ‘Huh? Who are you? What? You want to a buy a cow? We don’t sell cows, we sell steers.’ And then we gradually figured out the lingo and now ranches are aware of us and the ranches we work with like us so they say nice things about us to their friends. So the supply side thing is getting easier in a lot of ways as word gets out about what we’re doing.”
Crowd Cow says that its technology is playing a key role in opening up the market because it allows the company to accurately partition and sell every cut from the animal so nothing is wasted. Customers can pick and choose the exact cuts and quantities they want — however much or little — and this contrasts with traditional cow sharing from local farms, where it’s typically necessary to buy hundreds of pounds of beef in one big miscellaneous mix.
Technology also helps gets the product shipped efficiently to nine states (Washington, California, Oregon, Idaho, Utah and parts of Nevada, Montana, Wyoming and Colorado). Algorithms are used to compute the perishable weight and pull weather forecast information on the fly to determine the optimal quantity of ice, select the appropriate packaging and pick the best carrier.
The company is still bootstrapped, which they joke equates to “paid for by spouses.” But Heitzeberg, who led the in-house startup incubator for Madrona Venture Group, and Lowry, who was one of the co-creators of the restaurant directory service Urbanspoon, are well aware of when it will become necessary to seek additional funding.
“We’ve had companies before and had some success so it’s easier for us to bootstrap and hold out longer,” Heitzeberg said. “But I think at a certain point it makes sense, when you a reach a point where the opportunity is so big and you’ve proven how to mechanically go after it then it absolutely makes sense for everybody to put more money into it.”
On a recent Sunday, I had the chance to throw several Crowd Cow burger patties on the grill during halftime of a Seahawks game. I’m not sure if it speaks more to lousy football that day or the anticipation of great food, but those in attendance very much looked forward to the halftime meal.
The patties, from Step by Step Farm in Curtis, Wash., did not disappoint. The burgers were lean and flavorful. We all loved that the chargrilled taste of the meat was so pronounced even with the addition of cheese and condiments, etc. The burgers also did not shrink on the grill and maintained their size.
Knowing the backstory of the beef undoubtedly plays into your mind and sends a signal to your tastebuds. I don’t eat a ton of red meat, but when you’ve made an effort to understand how something is raised and processed, it goes a long way.
“Once you know where your food is coming from and you’ve tasted how good it can be — you are what you eat, and the same goes for the beef, right?” Heitzeberg said. “When it’s eating good and it’s been cared for it tastes better. It’s all dry aged on Crowd Cow, which you never find at the store, hardly.”
It’s the reason Crowd Cow is seeing a lot of customers coming back for more. They’ve had some folks who have ordered 10 times, 12 times or more. Beef is still the focus, but they understand variety could also be a component to future growth.
“People are eating a lot of beef, and of course they want pork and even seafood,” Heitzeberg said. “It’s a small startup and we had to pick our focuses, and our next focus is opening up and getting that growth thing going, build the team a little bit and then we’ll layer in those other things over time, hopefully quickly.”