Can a Burger Save Us?

Kara Miller:

Welcome to Instigators of Change, a Khosla Ventures podcast, where we take a look at innovative ideas, the people who come up with them, and those who invest in them.

Kara Miller:

I'm Kara Miller, and today a man with a company that makes burgers turns the usual approach to business upside down.

Pat Brown:

I have zero interest per se in making a burger of any kind, and I had zero interest, outside of it being necessary for this project, in starting or running a business.

Kara Miller:

Patrick Brown, the founder of Impossible Foods on why he walked away from his job, how he subversively plans to change the world, and how fast food has kind of shocked him. That's coming up on Instigators of Change.

Kara Miller:

Back in the mid 1980s, a company came up with a catch phrase so powerful it changed how we speak.

Commercial:

It certainly is a big bun.

It's a very big bun, a big fluffy bun.

It's a very big fluffy bun.

Kara Miller:

The company was the fast food chain Wendy's, and what they wanted to tell you was something about value, which they communicated quite effectively with one line.

Commercial:

Where's the beef?

Some hamburger places give you a lot less beef on a lot of bun.

Where's the beef?

Kara Miller:

Wendy's was trying to make a point, that their competitors might say they had a lot of beef, but that was hype. Presidential candidate Walter Mondale started using "Where's the beef" to cast his 1984 primary opponent, Gary Hart, as attractive but kind of without content, and thousands of business analysts and bankers have tossed the slogan around for nearly 40 years to let us know, "Hey, we are focused on fundamentals."

Pat Brown:

For a lot of people who operate in the day-to-day business world, what they care about most is, how are we going to do this quarter and this year, and what the world is going to be like in 10 years is something that gets almost no mind share at all. For us, it's what we spend most of our time thinking about.

Kara Miller:

Pat Brown gave up a successful career as a biochemist at Stanford, where he worked on understanding DNA and the cells it inhabits, and what did he do once he left the world of academia? Well, basically make burgers. But in entering the world of burgers, retail fast food, he's come to see that while he might have big dreams, business folks mostly want to know where the beef is. Now, that's a weird culture shift for a former scientist, especially since, as it turns out, the beef is nowhere.

Pat Brown:

The goal is not to taste like a beef burger. It's to be unequivocally recognizable as a beef burger but to most consumers taste better than the cow version. No one had really attempted that or really looked into what would be required, so I didn't know how hard it would be. I expected it to be hard, but I knew it was possible.

Kara Miller:

Brown took time off from Stanford about a dozen years ago to reevaluate what he was doing and how he could be changing the world in a useful way. And though DNA, micro arrays and better understanding how human disease worked, though that was important to him, he ultimately decided that the lab was not where he could have the biggest impact. Brown believed that raising animals for food was so drastically altering the planet that coming up with a beefy burger that contained no beef, that could really move the needle. By 2011, he had founded Impossible Foods, and right from the beginning, though some may have been skeptical of his ability to engineer this new awesome tasting burger, the scientist in him knew you had to believe in big leaps, even if that's not exactly fast food's mantra.

Pat Brown:

This is something that scientists always deal with. A lot of what every scientist is doing is trying to discover something that they don't know much about. They may not know for sure that it exists, or to invent something that's never existed before. There's always judgment involved. To embark on something like that, you have to think rationally about, is it possible? How likely is success and so forth? So this is just a normal part of when you're doing something that's never been done before that scientists are used to doing. And I guess I knew it was possible because what was required was to make effectively materials whose properties are defined by their protein and fat and small molecule constituents, and those properties, you can enumerate them in terms of the sensory and textures and flavors and stuff like that, and they all fall in ranges of sort of behavior of proteins and fats and small molecules that we have a reasonable understanding of, and at least we have the tools to study.

So the bottom line is, it seemed clearly an easier problem than the task of meaningfully, let's say, improving treatment of chronic diseases, for example. What's more important than that is that I believe this was doable and it was going to be hard but within our reach and within a few years to be able to get there. But more importantly, I knew it was absolutely essential for the future of the world. So I would've gone ahead with this even if I was quite uncertain about the feasibility of it.

Kara Miller:

Did you find in sort of the ramp-up to creating the Impossible Burger that it was harder than you expected, that it was easier than expected? Where did it fall in terms of what you might have thought if I had interviewed you before you began on the quest?

Pat Brown:

Some parts were harder and some parts were easier. We relatively quickly found the most important key to the flavor chemistry of beef and meat in general, and so that could have taken a lot longer than it did, but it happened that there was a strong sort of candidate that I had in mind going in that turned out to actually be a big part of the answer. So that big step happened quite early on. On the other hand, something that I had underestimated in thinking through the whole thing was the complexity of the supply chain and sort of the kinetics of changing the upstream sources of critical ingredients and so forth, so that turned out to be harder.

Another aspect that turned out to be harder is just navigating the business world, I guess I could say. There's all kinds of craziness in that world that is not set up to be particularly adaptable to doing something on the scale that we're aiming to do and that's as unimaginable to the world as what we're trying to do. So it's been a learning experience the whole way basically. But anyway, the bottom line is, overall, we thought we could do it. Now I'm absolutely certain that it's doable, because we've cleared most of the hardest scientific hurdles, but I still can't say for sure how easy it will be.

Kara Miller:

Well, and it must be quite a culture shift for somebody who's used to spending a lot of time in a lab to all of a sudden be dealing with Burger King. That's a very different set of inputs and people around you, I'm sure, than what you are used to.

Pat Brown:

Absolutely. Absolutely. We have people on our team who have been business executives and in the business world for their whole careers, who are much more adept at navigating the weird culture of that world than I am. But yeah, one thing that's a real interesting difference is that a lot of R&D is about imagining a world that's different from the current world, let's say, what might be possible, or parts of how the world operates that no one understands, and you need to sort of imagine what they might be to start trying to figure them out. Imagination, it doesn't play a huge factor basically in just sort of general business operations.

The other thing is that, so much about our business, I guess I could say, is about building a world that doesn't exist today and most people can't imagine existing, where earth literally looks different from space, where the human footprint on land is less than a sixth of what it is today, very, very different from the world that people experience, and we're trying to get there very soon. But yes, you're right, it's a very different world and they're sort of the values and the sort of the whole way people's minds operate is more different than I had imagined.

Kara Miller:

Hmm. If you, again, cast your mind back to the beginning when you had this idea, I think it's an interesting comment on human behavior that instead of trying to make the best bean and quinoa burger you could, you were like, "No, I want to make something that actually looks like beef and that kind of tastes like it." You were saying you were going for better, but I wonder what it was about human behavior that made you think, "I want something like beef."

Pat Brown:

Oh well, that comes back to why I'm doing this whole thing. I have zero interest, per se, in making a burger of any kind, and I had zero interest, outside of it being necessary for this project, in starting or running a business. That's not why I got into this at all. I had a job that I loved before I did this, and I had zero incentive to leave it. But the reason I'm doing this, I think it's really important to understand, is that unless we can essentially completely replace the animals as a technology in the food system, we are heading toward the worst environmental disaster that earth has ever faced, okay?

Replacing animals as a technology for producing food is our best and probably the only chance to avoid not only a climate disaster over the next few decades, but also the worst economic depression that we've ever seen, on top of which there's an even bigger problem than climate, which is the collapse of global biodiversity. And the use of animals as a food technology is almost entirely responsible for this collapse of global biodiversity, a symptom of which is that the number of living mammals, birds, reptiles, amphibians and fish on earth today is less than a third what it was 50 years ago. Nobody seems to pay any attention to that, but it's extremely well documented.

What became clear to me when I started thinking about this problem at Stanford, with zero interest of going into the food world, it became clear to me that by far the fastest and the best solution to both those problems, and really the only one that has a chance of meaningfully changing the trajectory over the next couple of decades, is to completely eliminate the use of animals as a food technology, to get rid of animal agriculture globally. And relatively quickly, not as quickly as I would have liked, it occurred to me that we're not going to solve this problem by educating people about it. We're not going to solve the problem by convincing governments to change incentives or policy or anything like that to tilt against that industry. The only way we could do it, and the way that has worked time and again when there's a problematic technology, is to invent a better one and compete in the market. That's why I'm doing this.

What that means is that the definition of a product that we care about at all is that the current consumers of its animal counterpart have to prefer our product overall over the one that they've been buying in the past. If not, it's irrelevant. I have zero interest in having the most successful veggie burger business in history. I wouldn't even spend a minute on that. Our mission is to develop a technology platform that outperforms animals in the food system in all the ways that matter to consumers and to scale it as fast as possible, and by doing so, to put the brakes on climate change and halt the collapse of global biodiversity. That's a hundred percent of what I care about in this. Business is just a tool.

Kara Miller:

When you talk about climate change, I assume a lot of that is the stopping of tearing down forests and maybe the rebuilding of some of those forests, places where now cattle are grazed.

Pat Brown:

That's a big part of it. So actually published a paper about this several months ago that goes into great detail about how phasing out animal agriculture would affect climate. But the gist of it is, there are two main factors. The first thing you need to know is that, unlike fossil fuel emissions, the emissions from animal agriculture are literally almost entirely reversible. When you burn coal, there is no, so to speak, thermodynamically feasible way to turn carbon dioxide in the atmosphere back into coal. But the carbon dioxide released by the animal agricultural system over history, which is equivalent to about 22 years worth of annual global fossil fuel emissions, the carbon that was released in clearing land for animal agriculture is about half as much as was released in the entire history of fossil fuel combustion.

The flip side of that is that if we could eliminate the need for that land to be used for animal agriculture and allow the original biomass to recovering on it, allow or actually actively assist that biomass recovery, we could over the next few decades, basically negate 22 years worth of fossil fuel emissions. So we get negative emissions. We unlock negative emissions on a huge scale. We don't just stop making things worse. We immediately start making things better.

The other source of negative emissions comes from the fact that two other major greenhouse gases produced by the animal ag industry, methane and nitrous oxide, unlike carbon dioxide, decay spontaneously. Methane has a half life of nine years in the atmosphere, which means that, unlike with carbon dioxide, where if you turn off the emissions, you're stuck with what you already put up there, with methane, when you turn off the emissions, you get negative emissions. In fact, if we halted animal ag right now, the decay of methane alone would offset five years of total global greenhouse gas emissions within the first decade. So there's nothing remotely as impactful in putting the brakes on climate change than doing this.

The other thing is, from an economic standpoint, let's think about the US. The animal ag industry is less than half a percent of, or let's say the beef industry, is less than half a percent of US GDP. But every projection from OMB, there was a really good study by a company called Swiss Re on this, about the economic impact of the climate change trajectory we're currently on, assuming governments keep the commitments they've made, which is unlikely, it will cost the global economy by 2050 something like $300 trillion.

In other words, we'll have a massive global depression if we continue doing this, and all we have to do to avoid that is phase out an industry that is almost a rounding error in global GDP and can be completely replaced in a way that actually creates better opportunities for farmers and the people engaged in that industry. But the problem with this is you have to be open to actually thinking about this, and it's something that is very hard for a lot of people to imagine is actually demonstrably true. That's why I'm not going to take the approach of trying to educate people about this. The approach is a subversive approach, which is just make it happen, whether people believe it or not. That involves basically creating beef, chicken, fish, dairy products, that are more delicious, cheaper and healthier than what they replace, and that's what we're doing.

Kara Miller:

Hmm. It's a good place I think to pause for just a minute. I'm Kara Miller speaking with Pat Brown. He's the founder of Impossible Foods. When we come back, we're going to talk a lot more, including talking about common criticisms of Impossible Foods, from nutrition concerns to energy expenditure, but first a message from KV.

Speaker:

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Kara Miller:

I'm Kara Miller talking to Pat Brown, the founder of Impossible Foods.

Kara Miller:

You were talking about making foods that you want, ideally, to be better tasting and cheaper and healthier than what people are eating now. To me, though, that brings up a very interesting question, and this is again kind of something about human behavior. I feel like I know a lot of people who would not order an Impossible Burger, at least not right at the moment, because they don't think of themselves as those kinds of people. They think of themselves as people who order regular burgers. How do you get somebody, even if maybe an Impossible Burger would taste better to that person, how do you convince them to try it in the first place? Because that seems to me the hardest behavioral shift that you have to engage with.

Pat Brown:

Yeah. That's an excellent point. The thing is that the fraction of the US population that's ever tried our product is on the order of 5%, and the fraction of the US population that even knows or cares that we exist isn't much higher. But among people who have tried our products, more than 90% rate them nine or 10 on a scale of 10 in satisfaction, so they deliver for those people. But none of that matters if we can't convince them to try it. So yes, that's a real barrier. So far Impossible Foods has really not invested much in marketing at all. That's sort of self-evident from the fact that most of the population in the US doesn't know we exist or much less care. So that's something that I think is going to be a huge unlocker of our business, is if we actually can successfully execute in national marketing to get people to try our products, a lot of them will be repeat customers.

But the thing about foods is that changing food habits is rarely instantaneous. There are a lot of foods that might be your favorite foods that you didn't like when you were a kid. So that's another factor in projecting the kinetics of our success is that for people to become consistent, repeat customers, they have to repeat a few times. An obstacle for us is the fact that right now our prices are higher than the prices of the animal products, and for someone to be willing to pay substantially more, the value proposition over what they're eating now has to be pretty substantial, and even being more delicious or just as delicious and a little healthier or something like that, is hard to balance for most consumers against the higher cost.

So that's another aspect of what we have to do is, to get substantially cheaper than the competition, and it's completely doable. At scale it's no contest, because we use less land, less water, less fertilizer, less agrochemicals, less farm labor, less manufacturing labor and stuff like that. But we have to get to a scale where we realize those benefits. So the way I think about this is, this only ends one way, but there's a lot of things that we have to solve to get to our goal.

Kara Miller:

A lot of people, I think, think in binaries of like, it's hard to get the exact numbers, but in 2018, Gallup found about 5% of Americans said they were vegetarian. About 95% said they weren't. That's not even very close to even, but I wonder if you think in those binaries or care, or you think in some sort of gray area beyond who is absolutely vegetarian and who is not.

Pat Brown:

So our data suggests that about 80% of the time when a consumer buys our product, what it replaces in their shopping basket is an animal product. Well over 90% of our consumers are omnivores. They describe themselves as meat eaters, so that's great. That's exactly who we want to sell to. We're not interested in selling to vegetarians or vegans, because it doesn't move the needle on our mission. But to penetrate that market again, we have to get them to try our products. So people who are used to eating meat and maybe have tried some plant-based meat products in the past, their experience has been very disappointing, and despite the fact that those products may advertise themselves as being, tasting just like meat or whatever, they haven't.

So there's a big psychological barrier. People just will assume that this is not going to be very good, and I don't particularly want to pay this price to try something that I don't think I'm going to like. So that's a big obstacle to trial that again requires very effective marketing to overcome, and that's something that we need to get very good at. But again, the basic point I want to make is, in a way, this only ends one way, because people, when they try our products, like them. When they've tried them a few times, they become regular customers, and when our prices come down, the choice is going to get a lot easier.

Kara Miller:

Do you think of yourself as running a food company, a tech company? How do you think about Impossible in terms of where it fits?

Pat Brown:

Well, to the outside world we look like a food company, because that's their interface with us, right? To me, we're a company that's trying to solve the biggest environmental threats that humanity has ever faced and do it on a time scale that matters, which is a couple of decades. So we're basically, I know this is going to sound cheesy, but saving the planet company on the inside. In terms of the way we do it, we're a technology company. The mission really from a technical standpoint is to build a technology platform that makes animals obsolete in the food system, and the technology platform is what enables the products. So once we built the technology platform, the product side of it isn't trivial. That's what food companies do, but that's the critical problem to solve, is to know how to make foods that deliver on all the things that to consumers are a better form of, say, meat.

We've succeeded in this, by the way. We just launched our chicken nugget product several months ago. It's doing incredibly well. And in blind consumer tests, it beats the best selling food service chicken nugget, three to one. That's McDonald's chicken nugget, and the best selling retail chicken nugget three to one. That's Tyson's. Consumers decisively prefer it on taste alone over the animal product. And our pork product, so pork is the most widely consumed meat in the world, in Hong Kong, where pork is the number one meat in the diet, it was preferred in a consumer test with local meat-eating consumers over the animal equivalent decisively. So they really did meet the target of being more delicious than the animal product. Of course, both of them are also lower fat, lower calorie, lower saturated fat, zero cholesterol, many health advantages.

From a technology standpoint, we know this is doable. We've actually succeeded with a number of products that actually outperform in deliciousness the animal products, which is the hard part. But that doesn't solve the whole problem, because we still have to be able to be effective at marketing, at scaling the supply chain and so forth, but we're doing it and we're learning every day. Like I say, we're continuing to grow month by month, year by year, but we want to get to global scale and fast enough to make a difference. Otherwise, seriously, this is not part of the marketing messages because it's too complicated for people to imagine, but the global environment is going to be absolutely disastrous, so that keeps us motivated.

Kara Miller:

Let me ask you about two things that I think sometimes people question or I've seen articles on. There've been looks at, for example, the nutritional value of Impossible Burgers. There's processed stuff in them. How healthy is that compared to more whole foods that you could have? What do you think when you hear that criticism?

Pat Brown:

Well, I think it's something that we have to respond to and I think we have very good responses to. People use processing as a surrogate for unhealthy ingredients. So the term "processed foods," everything you eat is processed. That soup you ate last night was processed. It didn't spontaneously turn into soup. The loaf of bread you might have consumed basically started out as wheat seeds that had to be ground and mixed with water and salt and inoculated with yeast or sourdough culture and then kneaded, in other words, subjected to mechanical stress to unfold the proteins basically, to process them so that the proteins change their structure, and then needed to be cooked. Processing has been an integral part of the food system since prehistoric times. There wouldn't be a food system if it weren't for processing.

The problem is, people think of processed foods, they think of these foods like Froot Loops or Twinkies, where a food company really was not making any conscientious attempt to make a product that is healthy for consumers' diets. They were trying to squeeze every cent out of it at the consumer's expense and replace what could be healthy nutrients with sugar and basically high glycemic carbohydrates, and in many cases, saturated fats or trans fats and stuff like that. That's the problem. The problem with the Twinkie isn't that it's processed. It's not necessarily any more processed than what you had for dinner last night. It's that it's mostly made of high glycemic carbohydrates and has very little nutrients that are essential for your health.

We don't do that. We make our products out of very deliberately chosen ingredients that are informed by actually the best science on the relationship between diet and health and not on soundbites and nonsense. We have very good grounds to believe they're healthier than what they replace. And that's another important point here, is that we're not trying to make a food that can be your entire diet. Our goal here is to make a food that's healthier for the consumer than what it replaces. All right? For our burger, what it replaces is a burger made from a cow, which is high in saturated fat and cholesterol and comes laden with all sorts of problems, is also highly processed. So we're making a much healthier product. We're making a product that is completely compatible with a fully nutritious and healthy diet, and we're always going to do that. It's one of our core principles.

Kara Miller:

But it's like you're not making an avocado. You're making a burger.

Pat Brown:

Exactly.

Kara Miller:

Right.

Pat Brown:

And just like an avocado, you could not survive if that's all you ate for your diet, and we're not making a quinoa salad or something either. We're making a product whose sole purpose from our mission standpoint is to replace its animal counterpart. If that's what it does, the consumer is, based on anything we know about diet and health, better off, and as far as planetary health, there's no contest.

Kara Miller:

One more question that I think gets raised sometimes I wanted you to address. There's obviously some amount of energy involved in making each burger, each Impossible Burger, and there's obviously... We talk about this quite a lot, a lot of energy involved in making beef burgers. Do you think about that differential in one versus the other?

Pat Brown:

That's the whole point of what we're doing. It's not energy. Energy, when people talk about energy, the problem isn't energy. The problem is greenhouse gas emissions. It's just a surrogate for fossil fuel combustion and greenhouse gas emissions. Every time we launch a product, we have done a life cycle analysis, and life cycle analysis means that we look at the impact of the whole system that was involved in producing it, so basically all the crops, all the fertilizers and agrochemicals that go onto the crops, all the manipulations of the land that goes into growing those crops, all the transportation that goes into bringing the raw materials ultimately to our production site, the energy that goes into running our manufacturing. Of course, we also look at the water, the water pollution, every environmental impact.

We publish those things, so we're completely transparent to the public, and they're audited by what I would say, or when we did our research, the most respected auditor of lifecycle analyses out there. So when we compare all the inputs and all the costs that go into making our product, and we do the same for the ground beef counterpart, just to focus on that one product, we use one-25th the land area. That's extremely important, because freeing up that land area is what enables reforestation to happen.

Last year, our sales in aggregate freed up a land area the size of San Mateo County, about 500 square miles of land, more than 500 square miles of land actually. That 500 square miles of land can capture a ton of carbon if you reforested it. So we're incredibly conscientious about this. Again, anyone who's curious about this can go to our website and read the life cycle analyses that we've posted for our products year by year and dig as deep as they want and draw their own conclusions.

Kara Miller:

A final question for you. You started this company just over a decade ago. How, as a leader, as somebody in business, we talked about that this wasn't really where you were before, which is in the hustle and bustle business. How do you feel like you've changed? What have you seen that's shifted you in the last decade or so?

Pat Brown:

Oh well, I would say I haven't fundamentally changed in my motivations and how I look at the world and so forth. But I would say one thing is that what I realized is that having been a scientist my entire adult life, I was sort of in a bubble. And it took me a while to realize how differently people in the business world approach problems and look at the world and think about the world. Many years ago, someone was interviewing me and asked a very similar question, well, what was the most surprising thing I learned going into the business world, and which I was totally unprepared for. The answer I immediately blurted out was, I was amazed by how much business people care about money, seriously.

Kara Miller:

Sure. Sure. That's true.

Pat Brown:

In fact, if you look at my initial pitch to investors... That's not intended to be disparaging. It's disparaging to me because I didn't have the, let's say, insight to realize that these people are thinking about everything in a way that's completely different from how I'm thinking about it, and I need to reframe things.

I was very fortunate when I first went out to raise money. My pitch deck basically was all about how critical what we were going to do as to the world and the science behind it, why there was good reason to believe that it was feasible and how to approach the problem and blah, blah, blah, blah, blah, and then practically the last slide in the deck was, "Oh, by the way, this is a $1.5 trillion industry using prehistoric technology that's just basically waiting to be taken over by better technology," which was in retrospect basically probably the only slide that I needed. So now, let's just put it this way, in future pitch decks, that has moved closer and closer to the front.

Kara Miller:

Gotcha. You're leading with that whole trillion dollar situation.

Pat Brown:

Yes. So I would just say that's that's, I guess I could say I was lacking an empathy for the mindset of people who lived in the sort of business and finance world and was talking to them as if they were already a kindred spirit, and it just was because I was in a bubble basically. That was still a revelation and still something that I'm learning all the time, that the things that I feel like are just absolutely top of mind, should be on everybody's top of mind, as far as I'm concerned and so forth, are not even the top 50 for a lot of the people I deal with. If I'm going to make any progress with them, I have to really do a reset of how I think and talk about things to be able to make that connection. That's probably true of a lot of people who don't have business experience who come into the world, and they've been thinking about problems from one perspective, and now they need to talk to people who don't share that framing. I was much slower than I'd like to admit in kind of coming around to realize that I needed to do sort of like an empathy reset to make that connection.

Kara Miller:

Patrick Brown is the founder of Impossible Foods.

Kara Miller:

Pat, this was a great conversation. Thank you so much.

Pat Brown:

Sure. I hope it was useful to you.

Kara Miller:

And thanks so much, as always, to you for being here. We welcome your comments, your ratings. You can leave us a review on Apple Podcasts if you're so inclined. We would love to hear what you think. I'm Kara Miller. The show is produced by Matt Purdy. Talk to you next week.