Photo:

Richard Drew/Associated Press

Beyond Meat

stock is crashing. What a stunning development.

In 2019 Beyond Meat went public amid massive media coverage, and its stock popped. It reached a high of $234 a share in the summer of 2019. Partnerships with distributors, retail grocery chains and fast-food restaurants were announced. A PR blitz led to fawning press coverage. This is the future. It’s healthy. It’s sustainable. Cow flatulence causes climate change. Eat this fake burger or everyone’s going to die.

Beyond Meat was inundated with initial-public-offering cash, and its products began appearing in restaurants and on grocery shelves. You can find Beyond Meat burgers, breakfast sausages, brats, Italian sausages and something called “Beefy Crumbles” at

Walmart.

Beyond Meat jerky even started showing up in convenience stores next to the real beef jerky, corn nuts and pork rinds.

McDonald’s

introduced the McPlant.

The question that many investors, cheerleaders or financial analysts apparently didn’t bother to ask: Who’s going to eat this?

If you’re a vegetarian, good for you. But how many vegetarians are there? According to Gallup, about 5% of Americans “consider themselves” vegetarians. Out of the gate, we have a product that 95% of the population has little use for.

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Even among vegetarians, how many were ever in the market for something that reminds them of the taste of charred cow flesh? Just a guess, but someone who “considers” himself a vegetarian and gets in line at McDonald’s is probably going to order the usual fare.

With the dot-com booms and busts, we were assured that market share was more important than early profitability, and to an extent that made sense. The competition for eyeballs and brand loyalty was critical. It was a survival-of-the-fittest sprint in the early days, and the winners of the market-share battles eventually figured out how to turn a profit.

But this isn’t about eyeballs. It’s about stomachs, and we’re not going to see huge numbers of non-vegetarians choosing fake over real meat. The only way this was going to work was if the average omnivorous long-haul truck driver, looking at the snack display at a Flying J, says to himself, “Well, I was planning to grab my regular bag of Jack Links Sweet & Hot Jerky, but I think I’m going to go with this Beyond Meat jerky instead.”

Beyond Meat’s market capitalization reached a high of $14 billion in 2019 and was still over $9 billion in June and early July 2021, with a stock price around $150 a share. On Friday the stock closed at $18.29, for a market cap of $1.16 billion. Even that’s probably too high.

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There’s a lesson here: It’s important to ask the simple questions like, “Who’s going to eat all the product?” Wishful thinking, media hype, and “It’s the future!” bandwagon appeals can’t repeal the laws of supply and demand. Speaking of supply, does anyone know what the shelf life is for those Beyond Meat burgers at Walmart?

Mr. Boucher is a political consultant.

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