Hampton Creek CEO on mayo buyback: 'Of course I would do it again'
(CNBC)
Hampton Creek CEO Josh Tetrick fired back on Friday at a recent report that his startup, Hampton Creek, had sent undercover teams to buy its own products and to call stores pretending to be consumers interested in vegan mayo.
He insisted that it was a small program focused mainly on quality control — not a way to drive up sales to make his company a more attractive investment.
"You've got to step back," Tetrick said on CNBC. "Did it have any impact on sales, and it had no impact at all." According to Bloomberg, Hampton Creek had hired contractors to go to grocery stores and buy the company's flagship product, Just Mayo, an eggless spread designed to taste like mayonnaise.
"The primary reason for doing it," Tetrick said, was quality assurance and quality control. "We have all the data to back it up."
He said Hampton Creek had started its series of secret "mayo buybacks" in 2013.
"If I had to go back and do it again, of course I would do it again," Tetrick said. "We started this in 2013, and to some extent we still do it today."
The company sent contractors to grocery stores like Safeway to buy up jars of its mayo product, which the Bloomberg report said "made the product appear more popular than it really was."
"To think this has anything to do with fund-raising, that's pretty silly," Tetrick said on CNBC.
Tetrick repeated that the purpose of the program was quality checks, and it had spent just $77,000 on the project.
"We spent more in snacks this year than the entirety of the program," Tetrick said.
Hampton Creek was said to be looking to raise $200 million at a $1.1 billion valuation earlier this year. The company reportedly pitched investors that it was going to grow to $100 million in sales in 2016 but that it would lose $63 million during the same time period.
Hampton Creek boasts several big-name tech investors, including Khosla Ventures and Founders Fund.
Last year, Business Insider reported that the company used "shoddy science" and regularly stretched the truth about its products. One former employee called it a "food company masquerading as a tech company." Also in the past year, the Food and Drug Administration told Hampton Creek it needed to stop calling its product "mayonnaise" because it did not include eggs.
One question Tetrick danced around? Why his employees were instructed in emails to avoid wearing Hampton Creek-branded clothing when purchasing mayo and to pretend they were customers interested in the product when they called in.
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