Take Your Impact Strategies ‘On the Road’
Purpose At Work: Lessons From Alpha Foods On How To Lead With Purpose
June 28, 2021
Many business observers might assume that when a company reaches the point where Alpha Foods finds itself today – six years in; 50 employees; $40 million in funding; $10 million in sales; 30-something SKUs; and 9,000 retailers offering its product – it means “the marketplace” was simply sitting there waiting for someone to just step in and capture the opportunity.
Not so, says the pre-prepared plant-based food company’s Co-founder and CEO, Cole Orobetz. To “really attract people like gravity to the brand, the messaging—and shift people’s perceptions of what plant-based is” requires “hand to hand combat,” especially for the sales and marketing teams—and especially when society is all but shut down for 18 months owing to a global pandemic.
Although the dramatically expanding food sector is rife with plant-based protein products brought to market by ethical, purposeful, mission-driven companies, Alpha stands out as a vanguard for leadership around a collectivized purpose: It seeks to Lead With We, to passionately embody the interests of all stakeholders in our collective future. For Glendale, California-based Alpha, that purpose is manifested in three simple, interconnected pillars:
- ANIMAL WELFARE: Decreasing our meat consumption drastically reduces animal suffering. “We know that animals born not for eating—that’s good for animals,” says Orobetz.
- HEALTHY PLANET: Choosing a plant-based diet reduces harmful emissions and land destruction. “We know that we’re doing the planet’s food system a service by taking the stress off animal agriculture.”
- HEALTHY HUMANS: Clean, quality ingredients mean you can feel good about the food you’re eating. “People are eating products they feel better about and that are better for them,” says Orobetz, “So they’re healthier.”
Frozen out of options & into an epiphany
Loren Wallis, a colleague in a prior venture, shipped Orobetz some of his homemade vegan bagel dogs in 2014. The latter, a lifelong meat-eater, tossed the gift into the back of his freezer. “I’d had a tofu burger, like, 25 years ago,” he says. “That was absolutely awful. And I never thought about being plant-based again.”
He was not alone. “I’m from ‘the Texas of Canada’,” he says. “This is a meat-eating province. It’s a big industry here. I didn’t meet a vegan or a vegetarian in Alberta my entire life.”
But some months later, business serendipity would fall from the sky in the form of a blizzard, leaving Orobetz housebound and hungry at his Calgary home. Eventually, he ran out of food. It was that vegan bagel dog—or nothing.
Nothing had prepared him for loving it: That was a huge surprise. But the “performance of the product, the experience, everything about it” worked for him. Orobetz’s expectations for plant-based food were as low as his future customers’ would be. So why wouldn’t his positive experience be? “A lightbulb went on for me … I’ve been searching for plant-based food options that I could get excited about for a number of years. And this is the first one that I actually got excited about, and could also visualize myself trying on a golf course or at a hockey game.”
Orobetz thought, “If I can enjoy this product as a meat eater and someone trying to eat less meat, there’s got to be millions, tens of millions, hundreds of millions of people out there like me with the same ‘palette expectations’ and experiences, eating animal products their entire lives.”
He called Wallis, who agreed. Alpha was born.
The company’s meat & potatoes
The essential idea behind Alpha – its alpha, if you will – was to create “craveable meatless meat products that are exactly what a meat eater would eat if a meat eater didn’t eat meat,” the company says. Thus, above all, “the consumer experience is super important,” says Orobetz.
Plus, the company brands itself as a “transitional” option. “We don’t feel that people should be required to make really extreme lifestyle shifts to have that healthy balance,” says Orobetz. “The company is predominantly flexitarian.” That means a semi-vegetarian diet centered around plant-based foods, but with the occasional inclusion of meat. “So, our taste and texture expectations are fairly high, and [consumer] standards are very high.” In short, the products can’t taste like a poor substitute.
But don’t call Alpha’s products meat “alternatives.” “How people speak about food and products is really important,” Orobetz says. “Number one, we don’t view it as an ‘alternative.’ We view this as an equal option to every other food out there.” Alpha products are not “analogues” of something else. “It’s just a great tasting product.”
The “surprise” that Orobetz felt when he first tried Wallis’s vegan bagel dog is at the heart of what the company wants all its new customers to experience. Orobetz calls this the “delighting factor.” People serve their friends and family an Alpha product, and when those satisfied eaters find out it “didn’t actually contain any animal or chicken in it, it was all plant-based … it disarms people. They take their guard down,” instantly changing “their preconceived concept of plant-based and vegan,” just as Orobetz had.
Despite looming challenges – for example, “It’s not a cheap business to operate in” – the co-founders expected nothing less than sustained rapid adoption. The concept of scale was “super important, and we built our business from day one for scale,” says Orobetz. “All of our programs and our supply chain, everything top to bottom has been built for large scale. And I really think that in the next couple of years, we’re going to start to see Alpha scale very nicely. We’ve been growing very quickly over the last few years, but we’re really getting into our sweet spot now.”
How does the company differentiate itself from the big, well-funded players in the space, brands like Beyond Meat and Impossible Foods? Those companies are mainly known for burgers, Orobetz says. “But we entered into the marketplace from the perspective of making it convenient for people to eat plant-based. And I’m speaking as a mostly single person living alone. I don’t want to go buy buns and lettuce and tomato and all of those things to make one burger.” That’s a lot of work. And “I can’t stand food waste.”
“Probably the first 15 products we launched … provided an array of options” beyond just the standard burgers populating the limited, albeit expanding, plant-based shelf space. “We view the brand as really a multi-dimensional offering for consumers,” multiple products for multiple parts of the day, and multiple days. “That’s a big differentiator for us.” Most of Alpha’s products are pre-prepared—“just add heat.” “But depending on the week, what’s going on in my life, I may use ingredients to create more of a home cooked meal or something quick.”
Alpha might have introduced too many products early on. Not from a supply/demand standpoint, but rather, recalls Orobetz, in the early days, “marketing wasn’t able to keep up with the number of products that we kept launching.”
The main ingredients in high quality corporate culture
The number of founders and entrepreneurs that are bringing purpose-driven and mission-based companies to the marketplace is increasing, Orobetz points out. “I think, ultimately having something that you [as founder and leader] believe in strongly is supercritical. Not only to your own motivation factor, to get out of bed every morning and work very hard 24/7”—founding and leading a new venture “is not a nine to five, Monday to Friday job by any stretch.”
But also because “one of the keys to … success as an organization” will be “recruiting the absolute best, top talent people in the industry,” Orobetz argues. People who believe wholeheartedly in the founding purpose and ongoing mission. “It’s not that they just like the products,” he says. “That obviously helps a lot, but they also believe in what we’re doing from a personal, internal perspective.”
For Alpha, it was “so important to really get the best, most highly motivated, passionate people,” Orobetz says. “And those are the people that take the organization to the next level every day. And especially in the early days, finding those superstar early employees” was “super critical because it’s really the first handful of people that are going to make or break you … people that are absolutely passionate and believe in what you’re doing day in and day out, will really go that extra mile.” It’s also vital, Orobetz argues, to work with “people that are okay with that ambiguity and scrappy” nature of a company’s earliest days.
And who will stick with the company through the inevitable hard times later on. Alpha treated the recent shutdowns not as a burden but an opportunity to hone its internal culture. “Last year was interesting for us because we spent so much time building up the organization and really working internally,” Orobetz says, “because no one was flying around meeting people, so we were all locked in.” As a result, “we’ve worked through a lot of our growing pains.” It concentrated on developing its sales team, pivoting its marketing, and honing internal functions. “So now we can really focus on the business development and marketing aspects of the company that we really have under-invested in to be honest.”
COVID changes the sales & marketing recipe
Alpha had to move to a much more D2C model, too, once grocery stores and restaurants shuttered in 2020. The company couldn’t sell as many products through retail outlets or restaurants, “so we had to find [our customers] where they are,” Orobetz says. “We had to get in front of their smartphone or their computer, and let them know who we were and obviously, drive a lot more brand awareness, and then be able to provide the product to them where they are, which is on their couch.”
At the same time, “we actually saw new customers come to our brand during the start of COVID because they couldn’t buy meat,” Orobetz reports, “or they got scared by what was happening at meat processing plants, where they saw people were coming down with COVID. So, there was a huge awareness factor when this all started last year. And it was interesting to see that people that were loading up the freezers were eating plant-based and obviously liking it. That was really validating for us: people who had low expectations or no expectations for plant-based, were actually delighted that it could be easy and it could be delicious as well—and they could feel better.”
Putting meat on the company table
Orobetz’s background is in food and agriculture venture capital. “I spent a number of years there and learned a few things not only about how to fund a business, but how not to fund and run a business, too.” The company did a lot of bootstrapping. “Definitely, there were some scary moments when we didn’t have financing. Or the financing that we wanted when we wanted it, because raising money is a lot of work.” Before its first institutional round of investing in 2016, friends and family angels provided the company’s initial boost.
“Funny enough, a number of our first investors were actually oilmen or ex-oilmen—very animal protein-centric,” Orobetz recalls. “And maybe their doctor told them that they needed to reduce their cholesterol and eat less meat, eat more plants.” Orobetz and Wallis were able to “capture the heart, mind, and stomach of lifelong carnivores to get them to the point where they could love the product, but also invest in the company. It was really validating.”
Don’t forget the real value of investment partners, Orobetz reminds us. For example, Alpha partnered with Blue Horizon as an investor in its series A funding round in 2019, “but we’ve known the company for a number of years. And what they’re embarking on is fantastic. They’ve got a very big grand vision as an organization to really change the world.” Blue Horizon is a key leader in a global “protein transformation,” a key step in creating a more circular and regenerative ecosystem and economy. “And they were also based in Europe where we had … no boots on the ground,” says Orobetz. It could – and did – help Alpha make significant inroads on that continent.
Similarly, funding partner Green Monday, which strives “to construct a multi-faceted global ecosystem of future food that combats climate change, food insecurity, public health crisis, planetary devastation, and animal suffering” helps Alpha “on the Asia side. And they’ve been fantastic in so many ways more than just providing capital to us.”
That’s the kind of growth that Lead With We companies consider valuable.
Cultivating a garden of corporate partners
Beyond nurturing a strong internal culture and attracting investors, it’s critical to collaborate with like minded partners in and out of your sector. “Our first retail partner was Walmart,” Orobetz says. So “we were a brand that was born in the mass market. Obviously, Walmart is the low-cost leader in the country, and that allowed us to make our products more accessible.”
“That’s really aligned with our philosophy of making plant-based food accessible for everyone,” says Orobetz. “If it’s too expensive, it’s not accessible. And if it’s only in high-end, maybe natural food retailers, it’s also not accessible. So, we believe that price point is super important.” The company once heard from a community partner that plant-based foods were “only for rich white people”—and it’s been working to evolve that limited perspective ever since.
Getting its products in the hands of low-cost retailers who can provide it at a lower price point is one step toward addressing Alpha’s concern about that common misconception. It also helps it to make a dent in standard, suboptimal Western diets—and ameliorate various other inequities in society, starting with rampant food insecurity.
In pursuit of those goals, Alpha followed its early Walmart alliance by securing Kroger, Publix, and Albertsons Safeway as major partners. And it views Costco as a particularly valuable recent “innovation partner,” as Orobetz calls it. “They have a really, really finely tuned sense of what their members want. And innovation is really at the heart of Alpha. It’s in our DNA. We can rapidly innovate and bring products to market. We’ve been working with Costco for … almost two years now, including on a first-to-market breakfast sausage patty” launched in June 2021. “And Costco has shown a lot of excitement for that. They can bring in products and innovations generally quicker than any retail grocery outlet or store,” Orobetz says.
Alpha’s leadership understands that a company’s overall “health” encompasses far more than its products, its bottom line, and its return on investments—but its impact. Orobetz himself has a long history of concern with companies meeting ESG standards. “As much as I would love to be able to hit a button on my computer platform and spit out an ESG report for the day or the week, on all of the wonderful, great things that we’ve been able to measure and how we’re doing good,” he says, “I think at the end of the day … view[ing] those three really commonsense pillars” – Animal Welfare, Healthy Planet, and Healthy Humans – “is enough.”
So, when reporting on impact, don’t fret over the miniscule details, Orobetz recommends. “I think for consumers and other partners out there, other stakeholders, it can be potentially too much information if you’re getting down into the weeds. Too many details.” Instead, he argues that, “at the end of the day, ultimately, we are providing a positive impact to the world and our stakeholders through what we’re doing. And we know every day that people make choices. And those choices have a positive ripple effect throughout.”
Orobetz is certain “that our best years are still ahead. I feel like in the last five years, we really went from an early-stage startup to a company with global distribution. We should be in almost 20 countries by the end of the year. We have evolved as a brand both in terms of our messaging, our look and feel, and our products. And, so, this is a really interesting and pivotal time for us. We’re finally at a point where we have done a lot of the hard work early on, that can be really challenging for a brand.”
Alpha’s poised to become a key player in the future of food—and business.