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Eat Just, the maker of the plant-based JUST Egg, could be shooting for a US$3 billion IPO. According to a report from Forbes, a leading investor says the company’s public listing could happen as soon as late 2021 or early next year. Having separately raised funds for its cell-based meat division Good Meat last month, the startup could be potentially eyeing a spin-off too.
San Francisco-based food tech Eat Just is eyeing a US$3 billion valuation for its upcoming IPO. The source, a leading investor, told Forbes that the firm will likely go public in Q4 of this year or early 2022. The ambitious valuation is a major increase from Bloomberg’s US$2 billion estimate dated last October.
The company has gained major investment attention lately. It bagged US$200 million back in March in a round led by the Qatar Investment Authority (QIA) to bring its total funding to US$400 million to date.
Just months later, the company’s cultured meat arm Good Meat secured US$170 million. Good Meat stands as the world’s first—and the only to date—to have commercially sold cell-based chicken. Given the decision to raise separate funds for its cell-based operations, it’s possible that Eat Just has plans for Good Meat to become its own separate entity.
Potential cultured meat spinoff?
Good Meat, the Eat Just division focused on cultured meat, raised US$170 million last month for its operations, separately from the US$200 million the company received in March of this year to fuel global growth. A press release stated the funds would be used to ”increase capacity and accelerate research and development for high-quality, real meat without slaughter”. Given this, it would not be entirely out of the realm of possibility for Eat Just to spinoff Good Meat as a separate company.
Eat Just has doubled down hard on its cultured meat operations. The company made global headlines when it debuted its cell cultivated chicken nugget at 1880 restaurant in Singapore last December after getting approval from the country’s Singapore Food Agency (SFA). They are building a large-scale factory in Singapore, where Good Meat is sold and delivered via Foodpanda. Constructed in partnership with Proterra, the facility is set to be a base for Eat Just to supply both its plant-based egg and cultured chicken across the region.
Outside of Singapore, Eat Just says it is poised to receive regulatory approval in the U.S. within the next six to 12 months. According to Forbes, co-founder and CEO Josh Tetrick is anticipating that China will also be giving the go-ahead soon after.
While still a novelty right now, cultured meat is set to become a mainstream thing, says Tetrick. So as more cell-based foods enter the market, Good Meat as a spinoff company could position itself as a leading first-mover in the space.
“What often seems bizarre at first blush becomes normalised later on,” said Tetrick. “Cultivated meat will eventually be boring, because it’ll be the meat everybody eats.”
Eat Just hopping on the IPO trend
The CEO previously alluded to Eat Just’s IPO last year. In an interview, he said that the company would be going public once it reaches profitability—a goal set for 2021.
“Once we get to operating profitability, which we’re looking to do before the end of next year, I’ll start a serious conversation with my team, the board, and a few of our largest shareholders about timing [for an IPO].”
Eat Just is joining a small but growing list of alternative protein companies that have gone public, offering investors potentially attractive exits. First and most famous was Beyond Meat in 2019, and this year saw Swedish oat milk maker Oatly jump on board too in May. There are also reports that Impossible Foods is now in talks to go public in 2021 as well, possibly via a SPAC.
Asia: a major market for Eat Just
One core part of the plant-based egg maker’s global strategy is Asia. While alternative proteins are still a tiny sector in the region, Asian markets like China and Thailand are poised to see demand grow by 200% within the next 5 years.
Eat Just has already strategically ramped up its presence in China. After launching on e-commerce giants JD.com and Tmall, the firm rolled out its vegan egg across Dicos. The fast food chain, which sits on the same league as McDonald’s in China, was the first QSR to swap its chicken eggs with a plant-based version.
Since then, Eat Just opened a plant-based culinary studio in Shanghai and has launched localised campaigns. Its most recent initiative involved partnering with street vendors across the city to offer 100% vegan versions of jianbing, one of the most popular Chinese breakfast foods.
Speaking to Green Queen Media at the time of the studio’s opening, Tetrick said China would “account for a large percentage of our future growth”.
“Consumer demand there is being driven by a desire for healthier, safer and more sustainable food products,” he added.
Asian investors agree- Eat Just has notably reeled in a long list of VCs from the region including Horizon Ventures and Temasek Holdings.
Allegations piling up
Not all news about Eat Just has been positive, however, with new allegations surfacing over the firm’s rent arrears. In March, the firm’s headquarters’ landlord 2000 Folsom Partners LLC filed a lawsuit claiming US$2.6 million in unpaid rent.
Then in July, food giant ADM launched a case against Eat Just over a US$15,000 debt for hemp seeds. Even FedEx has sued the company over more than US$72,000 delivery fees accumulated in the past four years.
According to the Guardian report, Eat Just head of communications Andrew Noyes said that all the bills except the rent had been settled. However, the article notes that court records still show that apart from the FedEx case, all the lawsuits in question remain active.
Lead image courtesy of Eat Just.