It is noteworthy that vegan-oriented web publications have recently posted laudatory comments on Just and its founder Josh Tetrick.  Articles appear in waves and show close similarity in content and syntax as though they were reproduced from a company release.  In contrast Bloomberg published a June 4th article in their Business Week platform.  Apparently Tetrick is pitching his egg substitute to companies in China with the intention of distributing through online companies.    While China represents an attractive market with a current shortage of protein and a vast population it is evident that Just lacks penetration in his home base of the U.S. Despite an apparent distribution agreement with Michael Foods, he claims to have sold egg-substitute liquid and derived products representing the equivalent of 40 million eggs.  This may sound impressive to the uninitiated, but over a year, this represents the production of a flock of 140,000 or less than 0.1 percent of the U.S. population of laying hens.  This claimed volume of sales is the record of an entrepreneur who boasted over a decade ago that his products would displace conventional egg production.

Josh Tetrick in his Mayo Phase

The Bloomberg article recounted the history of Hampton Creek, the predecessor to Just, documenting the lapse in ethics related to deceptive repurchase of fake mayonnaise and the subsequent investigations in 2016 by the Securities and Exchange Commission and the Department of Justice.  Neither Agency issued sanctions or initiated criminal action, but in mid- 2017 his entire Board resigned.

There is little substantiation that Just Egg is “sold in 10,000 U.S. supermarkets and is served in a thousand restaurants”.  Tetrick commented in the article that the product is available as a $5 to $8 liquid that can make about eight eggs worth of scramble.  This corresponds to $9 per dozen for real eggs and obviously is uncompetitive.  Recently Jacob Robbins formerly with the Coca Cola Company has joined Just and is advising Tetrick on sourcing ingredients and distribution of product. 

If Tetrick wishes to sell Just egg liquid through Alibaba in China, he will have to compete with conventional eggs that sell for approximately $1.20 per dozen.  Given the markups by Alibaba and JD.com, a single container of the product supplying the same volume (but not nutrient content) as eight eggs will cost the equivalent of $14 or $21 per dozen or between 15-17 times the price of conventional eggs in China.  The product may register initial purchases based on curiosity but given the price differential there does not seem to be any prospect for long-term market penetration. 

The biggest problem that Tetrick will face in China is the low barrier of entry for ersatz egg products given that his technology is not especially unique and that his brand would soon be copied and undercut.  If Just cannot establish a market niche in the U.S. or in the EU based on taste, quality, sentiment and a competitive price Tetrick will have to continue generating cash infusions from cupid Venture capital investors to survive.  He would naturally have to provide a business plan to justify additional infusions of capital.  As he burns through investment financing his claimed company valuation of $1.2 billion is fading.

Obviously Tetrick is entranced by the initial success of the Beyond Meat IPO. Emerging post-COVID competition will ensure that profitability of plant-based meat substitutes will be less than stellar. It is an observation that a flurry of adulatory articles appears prior to Tetrick passing the hat.  He has probably exhausted his credibility on websites disseminating pro-vegan material. He and his Company were certainly not accorded any favors in the Bloomberg article that should be read with careful attention to what is inferred between the lines.

As with previous commentaries and editorials on Josh Tetrick and his constantly changing corporate iterations, he is welcome to respond with facts and figures to support his claims and aspirations. His rebuttal will be posted if considered realistic and substantial. Any aspirant investor is also welcome to revert for a short primer on the realities of opportunities in the food business, ethics and related considerations.