Beyond Meat, backed by DiCaprio and Gates, is struggling. Can it bounce back?

American burgers can be meat-free, GMO-free, and soy-free, entrepreneur Ethan Brown has proven. His company’s flagship burger, the Beyond Burger, is designed to look and taste like traditional beef, but it does not contain a single gram of real meat.

The 2019 IPO of plant-based meat producer Beyond Meat caused a stir, with its shares soaring 700% in the first year of trading. Among the company’s investors were actors Leonardo DiCaprio and Jessica Chastain, as well as Bill Gates. However, over the past five years, Beyond Meat’s stock has lost nearly all its value, while the company has taken on debt and lost major customers. What led to the decline in Beyond Meat shares, and whether it has a chance to recover, we discuss in this Oninvest deep dive.

In 2009, entrepreneur and vegetarian Ethan Brown faced the problem of not being able to find healthy food for his children while traveling on the highway. That same year, he founded Beyond Meat, a plant-based meat company with a mission to promote a global shift from animal to plant-based products.

The standard veggie burger is meant to replace, not replicate, the hamburger for those who do not eat meat. Brown had a different idea: to challenge the U.S. meat and poultry industry, which at the time was worth more than $1 trillion. He decided that the products should not simply be mixed together, but transformed into something that closely resembled real meat.

To produce vegetarian meat as similar to real meat as possible, Brown secured a license for a technology developed by food-science professor Fu-hung Hsieh and researcher Harold Huff in 2010. The process of turning beans into a fibrous protein takes place in an extruder, a device that combines the functions of a pressure cooker and an industrial food processor. This method had long been used to produce textured soy protein. By varying moisture, pressure, temperature, and composition, Hsieh and Huff were able to achieve a texture that mimicked meat.

Brown sent a presentation to Silicon Valley VC funds. His inbox was not flooded, but he did receive several responses, including one from Kleiner Perkins, which has invested in Amazon, Google, Twitter, and Uber.

In April 2011, Kleiner Perkins invested $2 million in Beyond Meat. Shortly thereafter, Biz Stone – who later joined Beyond’s board – and Twitter cofounder Ev Williams invested in the company. From 2013 to 2016, Beyond Meat received venture funding from GreatPoint Ventures, Kleiner Perkins, Bill Gates, Obvious Corporation, the Humane Society of the United States, and Tyson Foods.

Investors also included celebrities and athletes such as Leonardo DiCaprio, Jessica Chastain, Snoop Dogg, and professional basketball players Chris Paul and Kyrie Irving. In total, Beyond Meat raised $144 million in 13 funding rounds, according to market-data platform Tracxn.

That same year, Beyond Meat built a plant in Missouri near a university and launched its first proprietary product, soy chicken strips. In May 2016, Whole Foods stores in the western U.S. began selling fresh Beyond Burgers. It was one a breakthrough and led to deals with other grocery chains, the Los Angeles Times reports.

In May 2019, Beyond Meat held an IPO that raised about $240 million, valuing the company at $1.5 billion. On the first day of trading, the shares jumped 163% to $65.75 apiece. The rally did not stop there – by late July, the stock was up more than 700% at $239.70 per share, and the media called Beyond Meat’s debut the most successful IPO of 2019.

Short sellers also tried to get in on the action: by the end of July 2019, nearly 44% of outstanding shares were sold short, according to S3 Partners. However, they lost heavily, with losses totaling $427.8 million in July, CNBC wrote.

Beyond Meat’s successful IPO coincided with broader enthusiasm for meat substitutes. According to research firm Circana, the total market in 2020 reached $1.3 billion, up 46% from 2019.

The popularity of the first publicly traded alternative-meat company did not go unnoticed by detractors. Just a few months after the IPO, there were tons of ads questioning the health benefits of plant-based burgers. The campaign was organized by the Center for Consumer Freedom, headed by lobbyist Richard Berman, whose targets have included the Humane Society, Mothers Against Drunk Driving, and the Centers for Disease Control and Prevention.

The campaign ran spots and full-page ads in the New York Times and Wall Street Journal asking, “what’s hiding in your plant-based meat?” In 2023, Beyond Meat launched its first advertising campaign to counter misinformation.

Instead of continued industry growth, recent headlines have been dominated by falling sales, layoffs, and plant closures. Shares of Beyond Meat, once a leader in the sector, have fallen from an all-time high of $239.70 per share in 2019 to $1.90 per share as of yesterday, October 9.

“Much of the initial bullishness around the Beyond Meat investment case around the time of the IPO was the expectation that plant-based meat could achieve a similar market share in the meat market that plant-based beverages had achieved in the cow’s milk market,” notes John Baumgartner, senior equity analyst for food and healthy living at Mizuho Securities. “There were numbers on the street sizing that opportunity to $20 to $30 billion over a 10-year period.”

Inflation also surged in the U.S.: from 2.3% in 2019 and 1.4% in 2020, it rose to 7% in 2021. In May 2024, two major Beyond Meat customers – fast-food chains Carl’s Jr. and Del Taco – ended their partnerships with the company, citing low sales of alternative-meat items.

For the second quarter of 2025, the company reported a nearly 20% year-over-year drop in net revenue to $75 million, disappointing Wall Street, which had expected $82 million. Beyond Meat posted a net loss of $29.2 million, an improvement of about 15% from a year earlier, and an operating loss of $34.9 million.

“We are disappointed with our second-quarter results,” Brown said at the time, attributing them to ongoing softness in the plant-based meat category, particularly in the U.S. retail channel and certain international foodservice markets.

Beyond Meat has lost momentum in recent years, with consumers increasingly choosing fresh and more affordable animal-derived meat over processed plant-based alternatives, Reuters notes.

The company has announced a more aggressive reduction in operating expenses. It will lay off 6% of its employees and has appointed John Boken, who has 35 years of restructuring experience, as interim chief transformation officer.

On September 29, Beyond Meat launched a convertible-bond exchange offer. It involves replacing a portion of the existing $1.15 billion in notes due 2027 with up to $202.5 million of new notes due 2030 and 326 million shares of common stock.

The offer is part of a business-transformation plan aimed at strengthening the balance sheet, said CEO Ethan Brown. The exchange is intended to reduce Beyond Meat’s debt by about $800 million. As of June 28, total outstanding debt was $1.2 billion.

According to the company, about 47% of the “old” noteholders have agreed to the exchange. Eight analysts now track the stock: five rate it a “sell,” and three rate a “hold,” according to MarketWatch data. Still, the average target price of $2.57 per share is about 20% above the current market price.

The AI translation of this story was reviewed by a human editor.