Hampton Creek, a San Francisco-based startup developing plant-based replacements for eggs, has raised its biggest round of funding yet.
Today, the company announced that it is taking $23 million in a series B round led by Li Ka-Shing's Horizon Ventures. Li is Asia's richest man, with a net worth of $29.2 billion, according to Bloomberg's Billionaire Index.
Josh Tetrick, CEO of Hampton Creek, told us he's thrilled to have Li as an investor. There were plenty of suitors, but Tetrick was attracted to Li because of his connections in Asia.
"Money matters, but we'll have a platform to take what we’ve done and extend it out," says Tetrick. He notes that "38% of egg production is in China. It's a massive market, growing every day. Horizons has experience and connections into the Asian environment."
Hampton Creek makes egg-replacement products based on plants. It sells to consumers and enterprises.
Tetrick says Hampton Creek is working with two Fortune 500 companies to take eggs out of baked goods. It has deals with four other Fortune 500 companies to replace traditional mayonnaise with Hampton Creek's eggless mayo.
Hampton Creek's plant-based mayonnaise tastes pretty much the same, if not better than traditional mayo. (See our blind taste test video here.) Some Whole Foods are using it in chicken salad instead of mayo. And some fast food chains will start using Hampton Creek mayo on sandwiches.
"Our cost structure is our advantage," says Tetrick. "We're 48% more cost effective. The cost of eggs comes from feeding chickens. Unless egg makers are willing to lose money, they don’t have a structure to compete with us. Unless they come up with a way to not feed the chickens."
For consumers, Hampton Creek sells mayo directly in grocery stores. Right now it's only in a few stores, but Tetrick hinted that it would be in more stores in the near future. It also sells a plant-based version of cookie dough that's quite tasty. That will be in stores in a few months.
One of the biggest things Hampton Creek is working on is a plant-based replacement for scrambled eggs. Tetrick is optimistic those will be done by the end of the year.
While that would be a big breakthrough, the goal isn't necessarily to replace eggs you eat for breakfast. It's to cut back on the use of eggs that work their way into every other product.
Says Tetrick, "1.8 trillion eggs get into all these different spots" — Baked goods, fast food, chicken salad, and so on.
The chickens that make the 1.8 trillion eggs aren't treated so well. As Tetrick previously explained to us the, "eggs are coming from rusty cages with chickens sh**ing all over each other."
Tetrick says he will use the new funds for expansion. It's going to get a new testing facility, triple its sales staff, and expand the R&D team.
Tetrick says the hope is that in the next year, or year and half it won't "sound too delirious when we say the conventional egg isn’t going to be around anymore. "
Here's the full release on the funding:
Hampton Creek Raises $23M in Series B Funding
Bringing Healthier and Affordable Food to Everyone, Everywhere
SAN FRANCISCO, California – February 17, 2014 – Hampton Creek,TM a technology company pioneering in food, announced today that it has completed a $23 million Series B financing round.
The financing was led by Mr. Li Ka-shing’s Horizons Ventures and includes participation from Jerry Yang and AME Cloud Ventures, Ali and Hadi Partovi, Jessica Powell of Google, Scott Banister, and Ash Patel. Early investors Khosla Ventures, Collaborative Fund, and Kat Taylor and Tom Steyers’ Eagle Cliff also participated. Hampton Creek has received a total of $30 million in funding to date.
Hampton Creek will use the funds to accelerate its rapid growth in North America, expand its operations to Asia, pursue strategic partnerships, and grow their team. Hampton Creek has built a unique technology platform to enable the production of healthier food at a lower cost, starting with the displacement of the conventional chicken egg. In the last 90 days, the company has signed partnership agreements with 6 Fortune 500 companies, including some of the largest food manufactures and retailers in the world.
“Technology enables everyone to have more options to better our future together. To keep up with all the demands for the growing global population, we need to be more efficient, more environmentally friendly, and have more quality and affordable choices,” said Mr. Li Ka-shing.
CEO and founder Josh Tetrick said, "We live in a time where the unhealthy choice is dirt cheap and convenient. And the healthy choice is pricey and inconvenient. When my Dad walks the grocery aisles to buy mayo or chocolate-chip cookies or eggs, the inputs that make them possible often come from bizarrely unhealthy places. Our goal has always been to build a company that brings healthier and affordable food to everyone, everywhere. Solving a problem means actually solving the problem for most people – not just the folks that can afford to pay $5.99 for organic eggs. We’re thrilled to have such world-class investors joining forces with us.”
About Hampton Creek
The mission of Hampton Creek is to bring healthy and affordable food to everyone, everywhere. The company received the Best of What’s New 2013 Grand Award by Popular Science for their “plant-based egg.” Hampton Creek’s partners include The Humane Society of the United States and Global Viral, an organization dedicated to addressing the world's most pressing infectious disease threats. Josh Tetrick, a Fulbright Scholar and former college football player, co-founded Hampton Creek in 2011 after spending seven years working in Sub-Saharan Africa with the President of Liberia and the United Nations, among other initiatives.