Impossible's CEO says the plant-based food and beverage industry is still in its infancy with lots of room to grow.
"We're early on in the adoption scale, simplistically, it's a $1.4 trillion market, total plant-based is $7 billion. It's around $2 billion in the U.S. There's just a lot of noise in those numbers and I continue to think we're just getting started," said Peter McGuinness, who took the helm of the company last April.
In 2022, Impossible Foods achieved record sales, including more than 50% dollar sales growth in retail. In 2022, though, it cut its workforce by 130 people to bring "costs in line with revenue," McGuinness said.
Many Wall Street analysts and experts call the rate of plant-based adoption an "S-curve," one that slows down, picks up momentum quickly and then tapers off as growth slows. But McGuinness said, "It's a little premature to talk about curves, or the end of a whole category, or call it a flop or fad."
Plant based meat doesn't work if it's just for 'upper income'
Consumers' willingness to spend on plant-based protein is in question though.
Historically, prices for plant-based options have been higher than those of animal meat. Amid infation, consumers have been opting for cheaper proteins like beef, poultry, and fish, which are now seeing a deceleration in inflation, though up 4.2% year-over-year in January.
Impossible has been using this time to bring down its price tag to be in line with real meat.
"We've gone down [in price] 21%" over the past two years, McGuinness said, but "we still have a gap to what I would call the private label cellophane...ground chuck, at the bottom of the well, but we've tightened that gap." The average cost for ground chuck (100% beef) last month was $4.64, while a pound of Impossible at Target runs $6.29.
McGuinness also hopes to change the perception plant-based proteins are for high-end consumers that have the capital to splurge.
"Plant based meat doesn't work if it's an academic thing or it's a bi-coastal thing, or it's for upper income. It only works for maximum health benefit both people and planet, if it becomes mass and so that's part marketing, this part advertising, that's part awareness, it's part value proposition."
Innovation and partnerships are what the company considers gateways to meet new consumers.
Its chicken nuggets are "preferred three to one to the animal," he said making it a "no brainer" to add a spicier version this week.
Restaurants provide "great ways to introduce Impossible to more people," with partners like Burger King, Starbucks, Cheesecake Factory, and Cracker Barrel, among others, he said, and there are more on the way that the company "just recently won."
As far as if the company plans to go public anytime soon, McGuinness said probably not this year.
"I wouldn't expect it, probably not. I mean, anything's on the table, but we're well capitalized at the moment and it's not a great macro environment to do so. It'll happen, probably not this year."
Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at email@example.com.