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Seth Goldman (Eat the Change) – The effects of COVID on the food industry. | Food for Thought
Food For Thought
Today’s guest is Seth Goldman, Founder of Eat the Change and PLNT Burger. Seth also serves as Chair of the Board at Beyond Meat.
About the Series
Food for Thought is a series of interviews featuring an array of professionals and thought leaders in the food industry.
From food production to supply chain constraints to product development, this series looks to the future of food in a post COVID-19 world.
▼ scroll for the Interview (video below)
Food For Thought
Episode 1: Eat the Change with Seth Goldman
Mike: Hi everyone! Welcome to the inaugural edition of Food for Thought.
A series of interviews EnWave is conducting with a variety of business leaders in the food industry. Covering everything from consumer-packaged goods to supply chains and product development.
The focus of food for thought is how we can rethink food in a post-COVID-19 world.
We’re really excited today to speak with Seth Goldman, founder of Eat the Change and PLNT Burger. Eat the Change is launching businesses that make climate-friendly foods delicious, fun, and accessible.
Such as the case with their first business, PLNT Burger in Silver Spring, Maryland. Seth also serves
as chairman of the board at Beyond Meat and prior to this he co-founded Honest Tea, a company he later sold to Coca-Cola.
Seth, welcome to Food for Thought, and thanks for being here!
Seth: Sure Mike, Good to be with you!
Mike: Maybe you can introduce our viewers from across Canada and the US that aren’t familiar with Eat the Change and you know, just a little bit about its inception of where you started and what your premise was.
Seth: Sure. Just a little bit about my background. I’ve been working in the food business now for more than two decades. I started a company called Honest Tea, which is now available in both Canada and the United States. I started that twenty years ago out of my house. Or twenty-two years ago even.
And then I became involved, became part of a company called Beyond Meat which has grown quickly and is also widely available in Canada and the US. I’m now Chair of the Board of Beyond Meat.
And just at the beginning of this year, I launched this new enterprise. A really a new platform called Eat the Change. So I, once again, starting small like the other businesses did.
We’re recognizing that the single biggest impact anybody can have on the planet and on climate is what they decide to put in their body. And its impact on landscape on the climate on obviously the creatures on the planet is driven by what put at the center of their plate.
And so we’re trying to both, encourage people to move towards more planet-friendly options but also to provide those options.
So PLNT Burger, as you mentioned is a first business that’s up and running and it’s a plant-based restaurant. The first two locations are housed inside of Whole Foods grocery stores and they are entirely plant-based.
We serve burgers and fries and drinks. Our latest sandwich that we just launched last month; it’s actually called the crispy chicken fungi. It’s based on what would normally be food waste. It’s made of what’s called the fruiting body of a mushroom. So these are Oyster mushrooms that normally get used as or put into compost as waste and we’ve taken them and made it into a delicious sandwich. So it’s been a fun business to build we also as part of.
Eat the Change just launched a grants program and this is now supporting non-profit organizations that are helping consumers understand the impact of their diets on the climate and helping them move towards more planet-friendly options. We’re giving away a million dollars over the next three years.
Mike: We’re chatting right now amidst a challenging time with COVID-19 and there’s a lot of businesses you know, some hunkering down, some are pivoting. Some are lucky enough for their products to be having record quarters in grocery stores.
How do you see this affecting the overall food industry and supply chains? Obviously, we’ve seen a big push to you know globalization in the last ten years. But we’re starting to maybe see a little bit more emphasis on how do we need to change that to create a more sustainable food environment.
Seth: Yeah, and is it’s a very challenging moment and I think every business has got the has to take the
moment to sort of assess and understand how can they make sure they’re relevant going forward.
So, you know, I think there are a lot of questions being raised about these meat production facilities. We’re seeing a lot of concerns around safety and health of the workers and health of the consumers as well.
But I also think there’s a chance for consumers to reassess you know. It would have been harder to convince consumers that we’re all connected in the planet that the decisions they make have an impact elsewhere. But I think what this virus has shown that you know what can happen in a market in China has an impact here. So it’s harder to deny we’re all connected and that our decisions all have impact.
Mike: So when you’re looking at building the businesses under Eat the Change do you focus on the plate first and then work backwards to the consumer?
Or do you say we want to focus on organic agriculture and different products and then say how can we bring that to people that might not understand?
Do you go from the macro to the micro or do you start from the consumer and go out?
Seth: Well we looked at the impact first. That’s why project Drawdown is one of the first organizations we donated to because they rank the solutions for a cooler planet. Their top-ranked solution under the two-word, food-waste and plant-based foods were the top two.
But there were others as well you know. How do we move to more (what we translate to as being) organic agriculture but an agricultural system that places more emphasis on soil health and water conservation? And so for us, organic was a good proxy for that.
But we looked at impact and then we think about how do we make sure there are foods available that connect to those causes.
Mike: On the food waste topic, that’s something that’s a very covered topic right now in the news. Obviously, a lot of that is food service, cruise ships and all these demands have effectively gone to zero.
But do you think that this is an oversupply problem? Or do you think that this will go – I mean there’s still a lot of staggering statistics that even with food service demand there’s still a lot of food waste.
Do you think that the businesses themselves are finding more innovative ways to get rid of waste products? Is that consumerism, just stocking pantries with more goods than they need? Is it a matter of coming up with dehydrated solutions?
Where do you see the most impact being made on food waste?
Seth: I don’t think this is really a distribution challenge. You know that certain food producers had produced for distribution and food service. When that channel basically got decimated there was just a lot of product that wasn’t able to be readily converted to retail that quickly.
So that’s that is a misallocation, but it doesn’t mean that our food system on its own is inherently wasteful.
But it is the way that it’s used and so I think one of the positive outcomes you’re seeing is people are and sometimes out of necessity, having to use all of the foods they’ve stocked in their pantries.
For economic reasons, or they try not to go to the store as much. So, I actually think we have a chance to create some healthier food waste habits here. Or at least I hope that’s the case.
I think there is also going to be a desire to make sure packaging can hold up better. How do we avoid less food waste? I think both for economic reasons and for just safety reasons people are incentivized to be more mindful of avoiding food waste.
Mike: We had a guest on our show yesterday who has an organic bean company in Canada. He was saying they have sustainable packaging that is fully compostable. But he was saying that it’s a matter of educating the municipalities on what to do with some of this packaging because they’re so new that they’re unsure of what they do with it.
It was one of those things that, you wouldn’t think that by being really innovative and trying to be sustainable there would still be challenges. But he said it’s actually been quite a challenge for their business. But they’re on the leading edge of bringing and educating the consumer on these types of packaging.
Seth: Yeah. I know that’s a real challenge. You know, sometimes innovations come to market and
there’s not the infrastructure in place to bring those innovations to life.
So compostable packaging, unless there are commercial composting facilities that are part of the waste stream, it’s an incomplete solution.
You know some of the compostables, comping from the beverage industry, they were folks for bringing out compostable models. Well, that’s a neat idea, but when someone takes a compostable bottle and puts it in a recycling stream it actually contaminates the waste stream. So there is a challenge in bringing these things as an end-to-end solution.
You really do need the government to play a role and municipalities need to play a role. The U.S. is especially challenged because we literally have different recycling policies municipality by municipality. And so, it’s almost impossible to implement a national recycling solution.
When I was launching Honest Tea in Germany I was so impressed to see there, the government, the federal government, had one policy. So that the capture rates were over 95%. Which of course is really impressive. When you get to that level of recapture then you really are making an impact.
Mike: Absolutely. So obviously with COVID right now, you know there’s a lot of negative things happening in people’s lives but it has shone a light on food.
I think a lot of people have traditionally been in a society where its fast-paced and when they go to the grocery store, they just grab whatever they can on their timeline. But just prior to COVID-19, people were taking a little bit more time to try products, to read the ingredients on the back of maybe a granola bar or whatever they’re eating, or whatever it might be.
Do you think that this overall, from a food perspective, in the long term, especially with the impact that Eat the Change is trying to have with educating the consumer more on what they’re putting in their bodies -you know, having people understand what eating for immunity means and things of that nature?
What do you think the outcomes can be of creating a more educated consumer?
Seth: Well I hope that this leads to more thoughtful approaches to food. It certainly, you know, we’ve already seen some response about these live, wet animal markets. So that’s one positive step and I think you know, here too. As we start to look at what’s happening in these meat processing facilities, I hope some consumers will do a little more thinking about what actually happens in those facilities. Because that certainly sounds like the government has raised concerns about that. So I think anytime we can create more mindfulness among the consumer about what they’re eating, how it’s brought to them, where it comes from, what’s involved in that supply chain, that’s a good thing.
Mike: On a macro level with plant-based diets. Let’s just say focus on North America. You’re the Chair of the Board at Beyond Meat. You’ve seen the progression, has anything surprised you just in terms of the adoption of how quick plant-based diets are being adopted?
What are the next evolutions of that? Not specifically to Beyond Meat, but just plant-based in general?
Seth: I am surprised and delighted to see how quickly it has been adopted. What I hoped would happen is happening. Of course, it’d be nice if there were more vegans and vegetarians out there. But that’s not the way I think about how change happens.
I think about there being more “flexitarians”, more people being willing to include plant-based foods into their diet and that that’s happening especially quickly.
We’re seeing grocery stores place plant-based meat in the meat section. It’s funny the local grocery store where I shop, I was just there yesterday, there’s so much turnover happening that store that these things are now everywhere.
Like it used to be, they had a plant-based meat section. But they’re just trying to keep the stock on the shelves so I found beyond meat mixed in with a bunch of other animal-based products. Like at this point, there’s putting it on the shelf and recognizing that it’s part of a continuum. So that’s been really fun to see. I think the next step is something we’re seeing.
It was just announced yesterday by Beyond Meat where they’re going to be launching in the Starbucks in China. So, you’re seeing these products both internationally but also in venues and in restaurants that are much more mainstream.
So yes, it’s wonderful. One, these are available to you know vegans who want them but it’s also wonderful when they’re available to everyday consumers who are just looking for a delicious food. That’s the next level of penetration and growth before this will move forward.
Mike: On that notion of you know, how do we go about from a societal perspective of making nutritious food – just of all kinds – more accessible to Canadians and Americans. Obviously, there’s going to be this big push for plant-based, but is it a matter of too much slack in the supply chain and intermediaries that are more a direct, farm-to-fork model?
Is it just a matter of you know educating the consumer on the products that they’re eating and maybe then realizing that on a cost per cost basis going to a plant-based meal versus something that’s heavy on meat.
Or whether it’s food that comes out of a box that typically is a little bit more accessible from supply and from a price point perspective but isn’t necessarily the most healthy.
Do you have any ideas or ways that that Eat the Change looks at making nutritious food accessible for everyone, not just those that can afford it?
Seth: There’s nothing about the plant-based food offerings that require them to be more expensive. You know sometimes scale drives that because they’re smaller businesses and the supply chain isn’t scaled up.
But by definition, you know, and you can look at an example like the Beyond Burger which uses 99% less water, 93% less land, and make its product. That’s a product that will ultimately be less expensive than its animal-based analog.
So I think the challenge is, get scale to these businesses and then create great brands and packaging. Make them delicious in terms of the formulation. You know there’s always that balance, of course, we want everything to be healthy.
But we also want to be competitive with what’s out there. You know I’ve looked at, as an example, I’ve tasted burgers that have no fat and they taste just like what you’d expect them to taste like – like a hockey puck. Or as Stephen Colbert said, a bar coaster soaked in MSG. So, you know we’ve got to recognize if we’re going to be competitive with a competitive set, we have to we have to satisfy the culinary demands of the consumer. That’s just a reality of these businesses.
So yes, we can move people towards healthier and sustainable diets but we can’t take them from where they are to a much further point. At least not in one step.
Mike: One interesting thing that you’re starting to see now with companies of all kinds whether they were an animal protein producer or a different food company. They’re focusing on being protein companies as opposed to meat or poultry companies. Has that shift surprised you at all?
Seth: No, I saw that happening. When we look at protein it’s a continuum and so there’s animal protein but plant protein is part of that. It’s only logical that when a large company, like a existing meat company feels threatened, they want to be able to evolve and be relevant.
And if they were stuck in just the animal-based side of the protein model and they would be looking at the growth happening in plant-based and say – you know we’re missing out and we’re going to become an outdated industry if we don’t evolve.
Mike: For those that might not know you know, when they hear plant-based proteins, what are those sources of proteins and are they coming from Canada in the United States or are they being imported from elsewhere?
Seth: Yeah, well we look at Beyond Meat and the main ingredients are pea protein. A lot that is grown is in Canada. It’s, you know Canadian yellow peas in fact. That’s the specific name of the pea. But there’s also obviously soy. It’s a rich source of protein.
But then there’s other things like rice protein, mung bean protein, sunflower protein. Almost every plant has some protein in it and so it’s just a protein level, that how do we extract that and make it in a form that doesn’t have an off-taste.
Of course, all the nuts have some levels of protein as well and so there’s plentiful sources of plant-based protein.
Mike: What might you say to the consumer that’s contemplating, that isn’t overly familiar with a plant-based diet and currently, maybe eats a lot of meat. Or they are flexitarian.
Are there any, statistics that you might give? Or just perspective? You had mentioned that it’s more about you know creating sensible food choices and flexitarian options. How do you kind of bridge that gap for those that are evaluating?
Seth: Well the first thing to do is to get them to try the product because it demystifies it right away. When you can go into Dunkin Donuts and have a breakfast sausage patty that looks taste and is actually the same price as the animal-based product that’s a very easy step to take.
When it tastes delicious you realize that this is easy to do and of course you know if throughout Canada now you’ll see almost every major chain has some kind of plant-based protein. So the first thing is to get them to taste it.
After that you know, it all gets easier because they realize the taste is great. They know the health benefits are better. They may not be totally familiar with the environmental benefits but it’s easy to communicate those.
Then of course if you get further down the line I get to the point where I say, okay, if we have a product that tastes as good or better has superior nutritional properties, better environmental story and the cost is ultimately going to be lower I actually can see a day where people can say well why do I need to have an animal-based product? What’s the point of that?
Because I don’t think people have an intrinsic need to kill animals to satisfy their dietary or nutritional choices.
Mike: What about from the plant-based side. The consumers are often aware of the patties and the sausages what are sort of the next evolution of product development within plant-based. Are we going to see it in bars or where do you see it moving from there?
Seth: Yeah. I mean plant-based bars already exist and plant-based dairy. Obviously, lots of different forms of milk some yogurts and cheese, some egg substitutes.
But I think it’s going to be every aspect. So, you’re starting to see now some interesting developments with plant-based chicken substitutes. Of course, you know plant-based pork substitutes.
But the biggest categories in meat are the cow, the pig, and the chicken. I think that’s where there’s still a lot of growth going be happening.
Mike: Okay. Shifting back to more of the agricultural side. Do you see much of a future on a commercial scale for vertical farming, hydroponics, aquaponics, you know different types of farming?
Seth: I think there’s some. I frankly, you know, everything I read says there is enough. There’s plenty of farmland out there.
Farming can be and might the thing and should be a positive way to do something with the soil. It’s certainly better than putting concrete on it.
So I’d love to see farmland continue to be used. I’m not a huge fan, of course coming from the organic foods world, with Honest Tea, I’m not a fan of setting up that much hydroponic farming. Can be water efficient? I don’t think you should be growing certain crops in certain climates where they’re not appropriate.
But you know, to be able to grow peas here in Canada, where these products can naturally thrive. That’s what soil should be doing. You know, peas are a nitrogen-fixing crop. So, they actually are pulling nitrogen out of the soil and are you know, fixing it. Sort of taking it out of our ecosystem in a positive way so we need plants and farmland to be the lungs of the earth and help keep our air and soil healthy and to capture water.
So, I have, I’d say mixed feelings. Someone will you know, certainly large-scale crops, I don’t think makes sense to grow indoors. Maybe certain specialty crops may make sense.
Mike: Back to the retail side, you mentioned going in the grocery store and observing the plant-based meat in the meat section. We’ve obviously had a big shift now with the last five years.
The retailers have made a big push into making the grocery shopping experience as seamless as possible. Now we’ve kind of had this immediate, abrupt change where we have glass barriers between cashiers and the customer.
Are you worried at all about how that the experience will change? With more people going, direct to delivery? Will it be a less personal model where they’re just, you know, clicking and dropping things into their basket and not focusing?
When you’re walking down the aisle it’s easy for you to pick up something and look at what’s written on the packaging.
Does it worry you at all? Or are you optimistic that humanity will ultimately prevail?
Seth: It’s already changed right. I mean, people are going to the store less and they’re adopting habits and those habits are going to stick. So yes, you’re going to see less people in store. As a result, you’re going to see less sampling of products and less sampling means less trial and so we’ve got to think about as a marketer, how do you get people to try new things?
They’re certainly going to be less inclined to walk by and take something to eat. That’s kind of in the open air and someone’s sort of been breathing on. They’re just, there’s going to be a long time before that, if it does return, before it returns.
So, I know grocery stores are already rethinking their models. I mean they’re seeing a ton of activity right now. But even more so what’s going happen to restaurants, right?
I was just reading about restaurants that have been trying to reopen in Hong Kong. They’re checking the temperature of people; they’re making people sit far apart.
I mean a lot of what people enjoy about restaurants is the chance to, or bars, is to associate with, you know, other people and meet them. It’s going to be a long time before that kind of thing happens.
So what restaurants are doing now is thinking about how do we make it to go experience more evocative.
How do you create a feeling of place, in a to-go experience? There is going to be a lot of changes.
I think anybody who is relying on a business plan that they wrote in January of 2020 is destined to have failure because they’ll be applying a business plan to a world that no longer exists.
Mike: Absolutely. I think it’s definitely going be a new normal.
On that note, obviously you started Honest Tea, I believe while you were in graduate school at the time. Talking about entrepreneurship now, and how quickly things can change, what might you say to smaller companies that are bringing, whether it’s a CPG product to market or a food business of any kind.
Just from your experience with multiple sizes of businesses and scaling what messaging might you leave them with right now where they’re struggling? Whether it’s from a cash flow perspective or ideation?
Seth: Yeah, so I actually the ideas for Honest Tea were developed in business school but I didn’t launch it until a few years afterward. But I did over the course of the time, we launched in 1998 and so right when we were getting started there was the dot-com boom and then the dot-com bust through 9/11.
Then we went through the Great Recession. With each of these crises ,I’m reminded, I spent a year after college in China. The Chinese character for crisis is formed of two different elements. One of the elements is the word danger and one of the elements is the word opportunity.
And so that’s what the crisis is. There’s danger. Real danger. Right now there’s health danger and there’s economic danger. But there’s also opportunity.
I would encourage any entrepreneur who is experiencing the danger is also think about where the opportunity is. Think about what shifts.
The fact is that entrepreneurs are able to make those shifts happen and adjustments more quickly than the big companies. There are big companies you know, major big companies that are going to go out of business. You know some already have.
There are whole industries that are going to become, if not irrelevant, totally changed and it’s very easy to see scenarios where an enterprise could recapture or take away what was a legacy business.
Think about how those pivots can be made and make them. Because like I said, if you’re relying on a business plan that made sense in 2020, it probably does not make sense today.
Mike: I want to be respectful of your time so I think we have time for a few more questions Seth. But on the innovation side, as it relates to the food industry do you see a lot of the innovation coming from the large CPG giants that have lots of R&D dollars to spend?
Or do you see it coming from grassroots entrepreneurs and building something up and then potentially getting acquired?
Where do you see it? Because on the entrepreneur side you’ve got really adaptable bright minds. But they might not have the capital. On the CPG side, you’ve got big budgets but there’s the rigidity of working with you know thousands of employees.
How do you see that relationship going forward?
Seth: Yeah, I think all the creativity is coming from the entrepreneurs. The big companies just don’t think that way. They aren’t as connected to the consumer. They aren’t as able to be as nimble and flexible.
What they usually do is think about their existing business model and how can they offer something that is in their existing business model. Maybe it’s a slightly different flavor different packaging format maybe a slightly different ingredient.
And the entrepreneur comes out of a totally different perspective. Which is, what’s something I needed. Something I’m either hungry or thirsty for. Where have I seen, where would I bring it, and how would I make that exciting and relevant to people.
And so those are two very different approaches.
There are a lot of entrepreneurs building things that will be acquired by big companies. But there aren’t many big companies that are bringing totally new ideas to market.
Mike: Any final thoughts that to leave people with? Just in general. We’re obviously in a big period of change and uncertainty. Any final thoughts?
Seth: Yeah. I’ll say that as challenging as this moment is, it’s also really exciting because there’s never been a chance for entrepreneurs to so fundamentally change the way people eat.
It’s just takes that creativity for sure. It takes a lot of determination and drive. But this is a moment where things are changing. And will change.
The Chairman of Coca-Cola used to say a crisis is a terrible thing to waste. Let’s figure it out. Don’t let this moment go by without understanding how you can capture some of it.
Mike: Great words leave with. I want to thank you Seth, for taking the time to speak with us today. I know you’re a busy man. I really appreciate it!
Stay safe! When the travel bans are lifted, I look forward to trying PLNT Burger!
Seth: Okay! Take care Mike, Good to be with you.
Mike: Thanks Seth.