Bloomberg reports that when Josh Tetrick, the food scientist/entrepreneur who created Hampton Creek, was raising $90 million from investors by telling them about his vegan-oriented ideas and proven demand for his products, he neglected to tell them "that the startup undertook a large-scale operation to buy back its own mayo, which made the product appear more popular than it really was.
"At least eight months before the funding round closed, Hampton Creek executives quietly launched a campaign to purchase mass quantities of Just Mayo from stores, according to five former workers and more than 250 receipts, expense reports, cash advances and e-mails reviewed by Bloomberg. In addition to buying up hundreds of jars of the product across the U.S., contractors were told to call store managers pretending they were customers and ask about Just Mayo. Strong demand for a product typically prompts retailers to order more and stock it in additional stores."
Tetrick tells Bloomberg that "the primary purpose of the purchases was to check the quality of the mayonnaise." And, "Five former Hampton Creek contractors and two ex-senior staff members say the buyback assignments were separate from quality checks at stores. The ex-contractors say in most cases they were told to simply buy up jars at nearby stores and were free to consume or discard them—not look for quality issues, as the company says."
"At least eight months before the funding round closed, Hampton Creek executives quietly launched a campaign to purchase mass quantities of Just Mayo from stores, according to five former workers and more than 250 receipts, expense reports, cash advances and e-mails reviewed by Bloomberg. In addition to buying up hundreds of jars of the product across the U.S., contractors were told to call store managers pretending they were customers and ask about Just Mayo. Strong demand for a product typically prompts retailers to order more and stock it in additional stores."
Tetrick tells Bloomberg that "the primary purpose of the purchases was to check the quality of the mayonnaise." And, "Five former Hampton Creek contractors and two ex-senior staff members say the buyback assignments were separate from quality checks at stores. The ex-contractors say in most cases they were told to simply buy up jars at nearby stores and were free to consume or discard them—not look for quality issues, as the company says."
- KC's View:
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I don't know about you, but I find the whole "quality control" explanation to be a little lacking in credibility...
