Q&A part 2: Hampton Creek CEO Josh Tetrick on internal controversies, thorny challenges and going public
"Tenacity of purpose is the most important thing," he said of the people he wants to work with and how to meet the startup's mission.
The inner workings of Hampton Creek have been in the news lately as much as the products and partnerships the company is developing.
In an interview with Food Dive, the company's founder and CEO Josh Tetrick talked about the plant-based protein powerhouse's boardroom, finances and what the future might hold.
This is the second part of our interview with Tetrick, which has been lightly edited for continuity. The first portion, in which he speaks about Hampton Creek's mission, clean meat and unique setup, is available here.
Food Dive: Hampton Creek has been in the news a lot recently. I would say probably over 50% of it has been stories about things that are going on internally with the company and not necessarily what it is that you're doing and developments that you're making. How are things going in the company?
Tetrick: … We are involved in finalizing some of the important R&D work that we're doing on liquid scrambles, so we're rolling out a scrambled egg sandwich before the end of Q1. We're finalizing some of the important things we need to do to solve the liquid scramble problem and some of those things include elements around shelf life and taste. We're spending a lot of time really drilling into that together as a team to nail that.
… We're interviewing and hiring a number of people across R&D, like new folks for the clean meat program. I'm interviewing a number two scientist this week. We are closing deals. I was in St. Louis yesterday meeting with one of our largest customers talking about a new potential deal structure to help us expand online and get more distribution channels.
"More people are buying our products today than they were yesterday. We're growing in categories. We've gotta deal with all that stuff clear eyed, but tenacity of purpose is the most important thing."
Founder and CEO, Hampton Creek
… That's a very brief synopsis of what we're doing. Some of the stuff out there doesn't really reflect the kind of thing that we're focused on. But I always tell my team that if there are really good things written, put your head down and do good work. And if there are bad things written, put your head down and do good work. At the end of the day, if more people are buying our stuff today and are eating a little bit better because of the stuff we're putting out there and the world is using less land and less water and less carbon, you've done your job. That's the case.
More people are buying our products today than they were yesterday. We're growing in categories. We've gotta deal with all that stuff clear eyed, but tenacity of purpose is the most important thing.
Food Dive: What is the current status of employees at Hampton Creek? The company’s board? Your finances?
Tetrick: Maybe I'll kind of take all these things that have been thrown out there. One, this idea that lots of people have left the company. So if you look at any high growth company — Tesla, Apple in the early days, Pixar in the early days — here's what you'll find. They will hire a lot of people and a lot of people won't work out. In every single solitary high growth company. Every single one. We're no exception. We've hired many more people that have not worked out at the company, and we've learned that [we need to do] a better screening for some of those characteristics that end up being really good for us: a grit, a tenacity, a deep purposeful intent about why they're here.
"So if you look at any high growth company ... here's what you'll find. They will hire a lot of people and a lot of people won't work out. In every single solitary high growth company. Every single one. We're no exception."
Founder and CEO, Hampton Creek
So people have left. I've asked people to go. People have decided in some ways that the pace is not right for them. This is totally OK. And we've hired even more people. I think if there's an article about three people leaving, it makes it seem like there's something that there's actually not. We hire people and people leave. That's the nature of what we do.
On the board stuff … we have a handful of folks … that come to board meetings and we call them board observers. That includes Jerry Yang's group, Temasek, Mitsui, a major Japanese conglomerate. An entity called WP Global. [Khosla Ventures] still has a board seat. And we're in the process of interviewing a number of different candidates across food and ag and technology that potentially could fill out the rest of the board.
Food Dive: And how about the finances?
Tetrick: … We're pretty fortunate that as we gain distribution, as our products get more profitable … as operations catches up with R&D, we're in a solid place. We also have … a great network of support too. Mitsui is a massive Japanese conglomerate. They backed us in the early days. Temasek [and Nan Fung Group] … is an important backer for our work. Khosla Ventures continues to be not just supportive in helping us recruiting, but also very financially supportive to the company. So we're lucky to be in a good place.
"We're pretty fortunate that as we gain distribution, as our products get more profitable, … as operations catches up with R&D, we're in a solid place."
Founder and CEO, Hampton Creek
From the moment I started the company, to do what we need to do, you need to raise capital. … The kind of company that we're trying to be, the one that can be around 300 years from now and is really changing things in a positive way, we need to raise a lot of capital.
But there's nothing different about that today than two years ago or three years ago or four years ago.
Food Dive: Have there been recent rounds of funding or do you have any that are planned?
… To do the work that we're doing across the board, and to want to do it with a global approach that's required, … we're always in that process. I don't know if you count that as rounds of funding or what, but we're always talking to strategic partners. We're always talking to inside investors, external investors about what it looks like to continue to accelerate things that we're doing. Again, which is no different than any company that's growing really fast at our stage. It's really the same thing.
Food Dive: I know that a little more than a year ago, you were very vocal about how Hampton Creek was not an acquisition target. Has your stance on that changed?
Tetrick: It's hard to imagine it could've hardened, but if anything, it hardened. … Every person we hire, the technologies that we develop, everything that we're trying to do is just for the purpose of increasing the probability that we get this thing done. We feed people better, that we bring an end to some systems that we don't think reflect who we are in many ways the current food system doesn't. If we thought being acquired increased the chances of us doing that, I would say sure. But we don't think it does. We think building a foundation that ultimately we'll be able to take public — but even more importantly we can leverage around the world for many decades to come — that gives us the best chance of really fulfilling why we started this thing in the first place.
"Everything that we're trying to do is just for the purpose of increasing the probability that we get this thing done."
Founder and CEO, Hampton Creek
… Some of my food friends who are much smarter than me in a lot of ways in the past three years have come to me and said, … "Are you crazy? What are you talking about? Why wouldn't you want to be acquired?” They're not in my head. I never wanted to be an entrepreneur. I didn't grow up thinking I wanted to start a company in Silicon Valley. I grew up thinking I was going to be a professional football player. I wasn't good enough to do that. Then threw my life into seeing if I could have an impact on the lives of kids and the environment and some other things that are meaningful to me, and then decided that a company was the best way to make that change happen. So then I started a company.
Then I thought that plants were the best way to start to solve it. Then I went to plants. My mind very much worked in that way, and I don't aspire to have a headline [that says], “Successful entrepreneur Joshua Tetrick sells his company for $1.5 billion.” … It's just not a motivator.
Food Dive: On the flip side of that, are there any companies that Hampton Creek is looking to acquire?
Tetrick: Yeah, definitely. Kind of the same thing as … talking to different investors. We're always talking to different companies. In Silicon Valley, in China, in India. People are always emailing me ideas and stuff. Everyone is getting results and wants us to take a closer look at them. But we're not close to any particular acquisition right now, but there are a handful of really interesting companies that are experts in a certain element of the technology that could be beneficial to us that we're talking to, that we might end up acquiring.
Food Dive: You've mentioned offhand a few times in this conversation eventually going public. When do you think that that might be happening, and what needs to do in order for that to take place?
Tetrick: I think more likely than not sometime in the next three, four years. … I also don't have an obsession about going public. I have an obsession with us really achieving a mission. I just think going public will be an important part of doing that based upon our growth, our financials. Sometime in the next three years will make more sense. It won't be in the next year. It probably won't be in the next year and a half. … You look at it as: If going public increases the probability that we'll do what we need to do from a mission perspective, we'll do it, and if it doesn't, then we wouldn't. But we do think now that going public would more likely than not increase the chances of us achieving the mission so we're looking towards that.
"I also don't have an obsession about going public. I have an obsession with us really achieving a mission. I just think going public will be an important part of doing that based upon our growth, our financials."
Founder and CEO, Hampton Creek
It's really just building the foundational things are what's really important. Continue to build out the technology platforms. Continuing to build our distribution, continuing to take bets on things that people think that we're crazy to go after, getting better and better about hiring the best people and promoting. All that stuff. That's what we're focused on. That's what we'd be doing, whether we wanted to go public or not.
Food Dive: With all of the negative news about things going on internally, how do you move forward as a company, both internally but also in the eyes of consumers and people who read those things?
Tetrick: Well, I think what's interesting is … consumers are very unaffected by inside baseball Silicon Valley stuff. Remember who our consumer is. Our consumer is a single mom shopping at a Beckley, West Virginia Walmart. Think about that consumer for a second. A single mom shopping at a Beckley, West Virginia Walmart. That consumer is not fretting over the latest funding news or the goings on of companies in Silicon Valley. They're probably thinking, “How in the hell am I going to feed my kids something tonight? Because I'm tired and they're hungry.” That's who our consumer is. They're pretty easy to reach. Give them something they enjoy eating, give them something that they can trust, something that tastes good, and they'll buy more of it tomorrow.
So that's a really important thing. … Our consumers are also a 19-year-old kid at one of the 572 universities who's eating our cookie today instead of a cookie that normally had eggs and dairy in it. … They're thinking, “Does that cookie taste good or not? If it does, I'm eating it.” So it's not that difficult to focus on them because that's what we've been focused on all along. Just make stuff that resonates and people will accept it. If it doesn't resonate with them, they won't — but we're growing in almost every single category.
"That consumer is not fretting over the latest funding news or the goings on of companies in Silicon Valley. They're probably thinking, 'How in the hell am I going to feed my kids something tonight? Because I'm tired and they're hungry.' That's who our consumer is. They're pretty easy to reach."
Founder and CEO, Hampton Creek
… That's why it's pretty easy to kind of let this stuff drip away. … Think about the foundational things at the company. Are you making products that are better from a social and environmental perspective that more people are buying tomorrow than they're buying today? Are you getting better about doing that?
… I think all we can do is put out facts. All we can do is say, “Here's something that's thrown out there, but here are the facts.” There's the food safety issue that was put out there. I'm less interested in articles about it, and more interested in what the facts are. The FDA came back with facts. … Some of those other things that came out before with the mayo buy back [probe], all we can do is put out the facts. … The regulators took a look at it. They looked at it, said there was no there there. Investors said it was immaterial, it's gone.
Food Dive: What kind of advice would you have for a startup?
Tetrick: … I'd say three big things. One is there are too many challenges in this world for you to start something that isn't around solving them. Meaning there are 2.1 billion people that suffer from micro-nutrient deficiencies today. There's a billion people that are going to bed hungry today. Farmers are suffering today. Sixty-seven million kids are not in school today. Start a business to solve that. If you start a company to really solve those problems, not only is the opportunity bigger, but you're actually going to be a lot happier because you're working on something with a deeper meaning.
Second thing I would say is it is really important as you go through stuff — and when you start a company, I can promise your readers you will go through stuff. All sorts of stuff. … People will say, “it's the best idea” and they'll say, “it's the worst idea.” They'll say, “You're going to be the next Apple,” and “You're going to tank tomorrow.” They'll say, “You're a genius” and “You're stupid.” They'll say, “It tastes good” and “It's gross.” It will be all sorts of different things. But the most important thing for your readers to remember is if you just, if you have a tenacity and purpose, through all of that, don't believe the good too much and don't believe the bad too much. Stay clear-eyed about what is, and focus really on just doing good work, and having that really deep tenacity of purpose. That will increase the chances that you get to where you need to go.
Then the third thing is find people that act like that and feel that and have that kind of attitude. It becomes really hard for you not to succeed.
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