Crowd Cow
Crowd Cow is an American online meat delivery marketplace. It connects fisheries and ranchers who raise livestock with consumers who want to buy meat.
Based in Seattle, Crowd Cow was founded in 2015 by Joe Heitzeberg and Ethan Lowry. The company initially shipped beef to customers and later expanded their offerings to include chicken, pork, lamb, and seafood. Crowd Cow provides customers with background about the ranches from which it sources its meat. The company markets its meat as following the sustainable agriculture principles and for ethical treatment of farm animals. It sells grass-fed and grass-finished beef and the ranchers it sources from do not use hormones or superfluous antibiotics.
Crowd Cow began importing Japanese A5 Wagyu beef in 2017. It received criticism for importing Wagyu beef from Japan while American beef ranchers had challenges competing with foreign producers. The company raised $25million from investors, including Maveron, Zulily founders Darrell Cavens and Mark Vadon, Joe Montana, and Ashton Kutcher.
History
Crowd Cow was established in mid-2015 by Joe Heitzeberg and Ethan Lowry. They had met each other in the 2000s at Avogadro, a mobile startup later purchased by Openwave. Heitzeberg was the founder of Snapvine. Lowry was the co-founder of the restaurant recommendation service Urbanspoon, and had previously been the owner with Heitzeberg of Hack Things, a company that teaches software engineers about the production of computer hardware. The name "Crowd Cow" was inspired by the founders' using the crowdfunding of meat from cows to establish the company.The two co-founders discussed startup concepts together and thought back to a shared friend who repeatedly praised the entire cow he had purchased from a Western Washington farm. The friend had made purchases every year of a supply of beef to share with another person. Lowry was the only person who consumed meat in his household since his wife is a vegetarian. Although he was unable to rationalize purchasing of meat through a farm for himself, he thought it would be feasible if he could get 50 people to participate. Lowry and Heitzeberg visited a Starbucks to conduct research, asking patrons for their opinions. The response largely fell into two categories: "I'm a vegetarian, don't bother me" and "That sounds absolutely amazing". They had prior involvement around 2013 in Kickstarter when they crowdfunded to create the product Poppy, which transformed iPhones into stereo cameras and wanted to use Kickstarter to test their idea. The pair were drawn to the notion of purchasing a farm's meat without going through an intermediary. They did not know anyone who sold cattle, so they conducted Google searches and visited farmers' markets and butchers but remained unable to find anyone who could help them. The co-founders next made unsolicited calls to nearby farms that typically went to voicemail. When they reached someone from a farm, that person would be skeptical of their plans. The duo in the end found two farms that they visited and were able to set up an agreement with. After locating a farm to sell beef to them, they sent an email to 100 friends about their plans. They conducted a Kickstarter campaign for testing purposes in which they hoped to sell portions of a cow they had purchased from a tiny farm near Seattle. Their website received 600 visits, and they took one day to sell their initial cow in the middle of June 2015 through orders from friends and people living in Washington, Chicago, New York, and Florida. The founders had little knowledge about selling beef. When they attempted to purchase an entire cow, they learned that they were actually looking for steer. Whereas cows are female cattle raised to make milk, steer are male cattle raised for slaughter.
In January 2016, Crowd Cow employed two people, Heitzeberg and Lowry; operated only in the state of Washington; and purchased steer and heifers from six farms in the state. It received $1million in sales after being open for several months. Every week, Crowd Cow would feature a steer on its website to allow customers to buy defined parts of it. It took about one or two days for the entire cow to be purchased. The founders wrote the software to account for crowdfunding in the purchase. They employed computer algorithms to calculate how much ice would be needed to keep the meat from going bad, taking into account the weather forecast of where the meat is being shipped to. Initially, the company only purchased the ranch's animal after customers had bought a sufficient portion of it. Upon discovering that customers would regularly and swiftly buy the beef, they began to purchase the cows and dry age the meat before the sales went through. The co-founders were responsible for personally packaging the beef in February 2016 but delegated the work by October 2016.
In January 2017, Crowd Cow had shipped almost 100 cattle to customers, and by August 2017, that number grew to 300 cattle. In 2017, it received several thousand monthly orders from customers who usually purchased beef on a two-month cadence. In 2017, Crowd Cow began shipping its products to everywhere in the United States except for Alaska and Hawaii. That year, their Seattle depot packed the beef for their West Coast customers while their newly opened Lancaster, Pennsylvania, depot did likewise for their East Coast customers. By August 2017, Crowd Cow had grown to 22 employees.
The co-founders self-funded Crowd Cow from its establishment through the beginning of 2017. On January 24, 2017, Crowd Cow received a $2million seed investment headed up by Fuel Capital, which was joined by Maveron, Zulily founders Darrell Cavens and Mark Vadon, and the National Football League quarterback Joe Montana. The investment supported Crowd Cow in increasing the number of locations to which it shipped its products. Calling himself "a big meat lover", Montana joined the investment round because he liked that Crowd Cow told him the source of his meat and found that the company served a niche where there was limited competition. Montana's participation in the funding led People for the Ethical Treatment of Animals to send him a letter filled with football puns imploring him not to invest in a company that facilitates the slaughtering of animals. On May 24, 2018, Crowd Cow secured $8million in a Series A funding round headed by Madrona, which was joined by Joe Montana, Ashton Kutcher, and Guy Oseary's Sound Ventures. At the time of the funding round, Crowd Cow was making $1 million in monthly revenue, which was a tenfold increase from the previous year.
In 2018, Crowd Cow partnered with a Shake Shack Seattle location in which Crowd Cow provided the restaurant with enough grass-fed beef to every day make 100 hamburgers they named "Montlake Double Cut". By 2019, the company reached $10million in annual sales. In June 2019, Kutcher's Sound Ventures invested $1million to purchase a convertible security to be used later during a Series B round for Crowd Cow. On November 18, 2019, Crowd Cow received $15.1 million in a Series B funding round. The company's revenue increased fourfold at the beginning of the COVID-19 pandemic as people were unable to visit restaurants and were largely stuck with making meals at home. It grew to 90 employees in mid-2020.
Products
When Crowd Cow started, it only sold beef. Its area of concentration is on selling different types of beef including the expensive Japanese A5 wagyu. It also sells chicken, pork, lamb, and seafood. Crowd Cow sells less frequently available meats such as bison, and during Thanksgiving, it sells turkeys. The company began selling pork for the first time on May 2, 2018. The types of pork it sold were pork chops, pork ribs, chorizo, bacon, and sausage. It sourced the pork from Deck Family Farms in Willamette Valley, Oregon, for West Coast customers and Autumn's Harvest Farm in Finger Lakes, New York, for East Coast customers.Its website features information about the ranches from which it sources its animals and how they treat the animals. The magazine Grist said the company "offers slick marketing, full of frequent beef puns and lovely photos". It allows consumers to view the ratings people have given the ranches. Initially only sourcing their cows from the United States and then Japan, Crowd Cow in 2018 began procuring beef from Tasmania. In 2020, Crowd Cow procured its meat from 100 farms in 23 states. It sources its meat from only unaffiliated farms and not from factory farms. Crowd Cow sells recently netted and smoked fish which it largely sources from fishery cooperatives. Seafood it sells includes Maine lobster, Icelandic Arctic char, lingcod, halibut, blue shrimp, and Dungeness crab. The company offers customers a "recurring subscription box" of meat. The meat in the boxes varies depending on the time of year since Crowd Cow sources its meat from tiny, unaffiliated farms. The usual sales involve quantities of meat that range from.
Crowd Cow enables customers to purchase modest portions of premium ranch-raised beef. The Guardian said in 2017 that Crowd Cow charges similar prices to Whole Foods and butcher shops. Crowd Cow advises its customers not to prepare the beef past medium rare. The customer chooses among different meat cuts including New York strip steak, rib eye steak, Coulotte steak, flat iron trimmings steak, and filet mignon. Other parts of the cattle for purchase include the animal's heart, tongue, liver, kidneys, tail, hooves, and bones for making broth.
Wagyu beef
On July 12, 2017, Crowd Cow began importing to its American customers the Japanese A5 Wagyu beef from Mirai Farm, which is based in Kagoshima Prefecture in Japan. According to Food & Wine, Crowd Cow became "the largest single importer and online retailer" of that type of beef. The company's co-founder Joe Heitzeberg, who has a Japanese minor from the University of Washington, visited farmers and butchers in Japan to learn about wagyu. It is the first company to import to American customers the Olive Wagyu, a scarce type of Wagyu made from Shōdoshima cows that are given olive oil, rice straw, and ryegrass to eat. Defeating 182 other Wagyu brands, the Olive Wagyu won the "Best Fat Quality" award in 2017 during the quinquennial Wagyu Olympics. After the COVID-19 pandemic caused many restaurants to close, Crowd Cow turned into the largest supplier of Japanese A5 wagyu beef to Americans and sold over 50% of that type of meat purchased by Americans.Crowd Cow's importation of wagyu beef from Japan sparked criticism. Critics thought the company was betraying American ranchers who faced difficulties in raising grass-fed cattle while inexpensive non-American beef was being imported. They pointed out that Crowd Cow had promoted selling locally produced meat, especially since its mission statement says it ships "healthy, high-quality, sustainable meat" from the "very best local farms". Following the wave of criticism, the company revised its mission statement to remove the words "local" and "sustainable". To promote the wagyu beef, Crowd Cow produced articles, videos, and Instagram quotes. It started a haiku competition in which the victor would receive a Japanese knife. The James Beard Foundation Award-winning author Adam Danforth entered the haiku: "The Best Beef/ Is Found On American Farmland/ Vote With Your Money".