As businesses across the nation have been left reeling from the effects of the coronavirus outbreak, the Seattle-based startup Crowd Cow seems to have been checking all the necessary boxes in recent months to position itself to not only survive, but thrive.
While no one was really ready for a global pandemic, 5-year-old Crowd Cow has definitely been preparing its online meat marketplace for the opportunity to serve more people. With restaurants closed and the traditional meat processing industry buckling under the health crisis, Crowd Cow is two months into seizing on that opportunity.
“Our demand just skyrocketed overnight,” Crowd Cow co-founder Joe Heitzeberg said. “Everybody’s now home and you’re eating a home-cooked meal. You’re not going to restaurants. So all of that demand has found its way online for people looking to buy proteins and meats and other ingredients to cook at home.”
Initially launched by tech veterans Heitzeberg and co-founder Ethan Lowry as a crowdfunding platform of sorts for meat lovers, Crowd Cow has evolved considerably since its days of offering up one whole cow. That cow would be processed and shipped to buyers after all the cuts of beef were pre-purchased and the cow was “tipped.”
Crowd Cow is now a full-fledged marketplace for a variety of proteins including beef, pork, chicken and seafood. The company partners with more than 100 farms and ranches across 23 states. Sustainably raised animals are processed by smaller regional operations and not the factory processing plants suffering through some of the scariest COVID-19 outbreaks.
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Orders are picked, packed and shipped from Crowd Cow fulfillment centers in Oregon and Pennsylvania and a third is set to open near St. Louis in June. The company of 90 people is hiring, revenue is up four times, and Crowd Cow — which has raised $25 million to date — is way ahead of its plan and looking at profitability by summer and thinking even bigger.
“We were just knocking on doors to get our first cow five years ago,” Heitzeberg said. “Now you can load up your [online] cart with whatever you want and get it on a regular basis.
“We were prepared — and I feel more lucky and grateful about that than to say, ‘Yeah we were ready for this,’” he added.
Heitzeberg cited the good timing of raising a $15 million financing round last November; the recent launch of subscriptions so people can buy products more easily; and the addition of more everyday staples to get beyond premium “Friday night dinners” and offer meats with a price that is competitive to physical grocery stores.
“And our supply chain is very resilient because we don’t depend on the one that’s now falling apart,” Heitzeberg said of reports about the large poultry, pig and cattle processing plants hit with virus outbreaks. The inability of such facilities to shut down for an extended period or even practice social distancing has been blamed. There are fears of a meat shortage in grocery stores.
Citing a $200 billion a year industry, with 86 percent of the market controlled by four companies, Heitzeberg contrasts Crowd Cow’s “teeny tiny” operation against a picture of giant factories in which workers stand shoulder to shoulder processing meat.
“If they have to distance workers just to be minimally safe, that will reduce their production. It’s just math,” Heitzeberg said. “That’s the problem with that system. We don’t have that problem.”
For the people they work with and customers they serve, Crowd Cow views it as a chance to lean forward and demonstrate a simpler system that’s more environmentally sustainable, better for animal welfare, and better for local communities and farmers — and one that’s open for business.
Farms that normally sell to restaurants as well as Crowd Cow have needed the online operation now more than ever. And it’s the same for butcher operations they work with that also process meat for restaurants, casinos, hotel chains, and others — business went down severely.
Heitzebrg’s message was, “‘Keep doing what you do and we’ll just take more of it through our website.’”
Crowd Cow credits being based in Seattle, the early U.S. epicenter for the coronavirus outbreak, with helping it recognize the need to quickly address a variety of safety measures at its facilities. There are now COVID safety committees, dedicated staffers who do sanitization work all day, temperature checks, plexiglass dividers on lunch tables and more.
“Being really nimble, being a startup of our size we can move really really fast,” Heitzeberg said. “We’ve got a great team that is super excited about our position and super grateful that we have a job to do that’s more important than it ever was.”
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