The film Tora! Tora! Tora! Has a quote where a Japanese admiral says “I fear all we have done is to awaken a sleeping giant and fill him with a terrible resolve”. Of course, this Americanized propaganda piece of a quote is in reference to Pearl Harbor’s attack that enraged the United States to enter World War II. Oh, by the way, greetings from Japan.
In observation of JBS’s Planterra’s OZO’s (wow what a name chain) plant-based meat section being pulled out of the United States, many of my friends and enemies forget the fact that this brand is still going on in Europe and Brazil.
Throughout my time working in the food industry I’ve met a lot of brands who want to get into the United States because it’s the most profitable.
Not only that, but you’re seeing well-funded startups put outposts (or they call them HQs) in the United States trying to get a foothold of not only presence but talent.
But in general, the United States market is extremely competitive. Though not just plant-based brands, but also every other food category that floods the shelves.
Let’s dive into what makes the United States such a captivating market for foreign brands, but also realize the warnings about just how hard it is to capture market share in the US.
Economically the Strongest
I’m probably the worst economist you’ve ever met but I think I understand what’s going on. Essentially, due to a lot of external factors ripping apart the world such as plague, war, famine, and bad decisions, a lot of economies are tanking due to their dependencies on each other. The United States doesn’t have this issue. We have a pretty self-sustaining power supply, food supply, water supply, and defense. Though we are still feeling the effects of inflation in the United States, the feds raising interest rates make the dollar even stronger.
Because most countries have finances tied to the dollar, it causes more financial issues like debt to amplify.
This then produces not only a strong dollar, but crippling’ currencies like the Euro, the Yen, and many others currencies. This has made my travel experience actually very cheap! At least in Asia, I can buy things at a minimum, a 30% discount.
What does that mean? The whole world got more expensive. The worst part is, a strong dollar might be detrimental to the United States as that means we can’t buy anything! In any case, due to the current environment, it is very hard to import/export anything to America. This exponentiates when it comes to food, which is supposed to be cheap, and every penny counts.
Capital and Talent
I’ve met several startups who’ve either moved to the United States or have thought of moving for the sake of raising capital. It is still true that the closer proximity you are to the money, the higher your chance of success you have. Not because you enjoy having your investor knock on your door every week, but because there is a high concentration of ambitious talent that wants to strike big. Throughout history, young people move to cities because they have dreams.
America is still known to have the best higher education system in the world. An American college (whether Harvard or Arizona State University) is still highly regarded as a much better education than other countries. There is a reason why rich people from other countries send their kids to America and there is a reason why a good amount of these students stay and begin their life here. Based on what several of my friends and guests say, you can progress in life here.
Not only that, but immigrants actually have a shot at creating a company here. More immigrants than home-grown US citizens create businesses here. Our government is very proactive and free when it comes to creating businesses.
In a startup sense, having capital allows you to speed up your business, and having talent allows you to run it at peak efficiency. With the United States leading both, this becomes a supercharged well for startups to tap into. That means innovation can spark at a much faster rate than in other countries.
Crushing Competition
You can be king in your own country, but when you enter the giant’s arena, be prepared to get your ass kicked.
Beyond and Impossible, though slowed, are still the market leaders and undifferentiated players are getting crushed. There are plenty of reasons why JBS shut down the US operations for Planterra. In a product perspective, OZO just didn’t taste as good and the ugly orange gradient package didn’t help. I just don’t think they had the capital to tackle as strongly as the US brands. I’ve heard tons of stories of brands that do really well in their home country getting crushed by the competition in the United States just because I believe we truly do innovate at a different level.
Beyond and Impossible have years of capital, talent, and innovation. Their brand is trusted in the United States and from what I understand, it’s still their top market to dominate. We also can’t forget brands like Morningstar or Gardien who’ve been around for ages and are also innovating their asses off in retail as well.
A new trick I’ve noticed recently is startups who are setting up shop in America.
NotCo, Turtle Tree, and Tindle have all announced HQs in the United States mainly for market awareness and to capture technical talent. They can easily do this because they have millions in the bank thanks to their investors.
It is hard to predict if this approach will be successful.
Forward-Looking Indicator
After interviewing people from a few countries, it is easy to say that everyone is paying attention to the United States and still considers the United States the top country for innovation, talent, and capital. As much as we like to complain about idiots in crypto, our divisive government, and the slow growth of alternative proteins in the United States, other countries are analyzing what’s going on and are taking notes on their approach to introducing their products to the United States. However, from what I’ve learned, is that hubris and history always repeats itself. Don’t get blinded.