The Startup That Lets People Crowdfund a Cow

March 17, 2017

PolinaMarinovaFor many modern consumers, the origin of their food is just as important as its nutrition stats. That’s why high-end grocery stores like Whole Foods often specify which farms their meat and vegetables come from, sometimes even including detailed stories about their staff and methods. Still, even this attention to detail isn’t enough for some discerning eaters. In order to ensure they know exactly where their food comes from, these consumers can pool their resources together to purchase a cow directly from a quality-assured farm.

Of course, buying an entire bovine is no simple task. Along with finding the right farm, cow-seeking consumers must also round up a herd of friends to join them in this investment. If they can’t find any interested parties, then they’re out of luck. Fortunately, that’s where the new startup Crowd Cow comes in. Each week this Seattle-based company introduces users to a cow they can buy together on a crowdfunding platform similar to Kickstarter. “A steak is a good $20 on your plate. Why shouldn’t you know what kind of steak it is and where it came from?” said Crowd Cow co-founder Joe Heitzeberg. “We want to create this new supply chain that directly connects consumers to producers with all sorts of products.”

The process starts with a video about the cow on offer and the farm that raised it. If a person likes what they see, the next step allows them to select which cuts they want to buy. Crowd Cow calls these “shares” that make customers “steakholders” in their particular cow. When all the shares are purchased, the cow “tips” and the company ships the beef out. If the whole cow fails to sell, customers miss out on their meat but won’t be charged for trying. The company only offers top quality cows in its auctions, leading steakholders to place orders that cost anywhere from $12 to $219 depending on the cut. So far this system has earned Crowd Cow more than $1 million in sales and $2 million in venture capital investment.

Questions:

 

  1. What are the advantages of buying beef through a platform like Crowd Cow?
  2. Will companies like Crowd Cow someday be able to compete directly with supermarkets?

Source: Polina Marinova, “This Startup Lets You Buy a Cow With Strangers on the Internet, Fortune, March 7, 2017.

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