Two months after pulling Hampton Creek’s vegan products from its shelves, Target has made its split from the startup official. Target initially pulled the products due to allegations about food safety. Though Target shared its concerns with the FDA, Hampton Creek last week announced that the FDA had found no safety issues.
A Target (TGT) spokesperson told Bloomberg there were “multiple reasons” for ending the relationship. But in a statement, Hampton Creek CEO Josh Tetrick wrote that “To our surprise, Target informed us that sharing with the public the FDA’s conclusion that our products are safe somehow violated Target’s vendor communication guidelines. Target told us this is what drove their decision to end our relationship, in spite of their pledge to bring back the products once the FDA confirmed their safety.”
Target generated $5.5 million in annual revenue for Hampton Creek, and was its largest retail customer, according to Bloomberg. But a company representative has told Fortune that Target represented “a single-digit percentage of sales.” Hampton Creek’s products are still on the shelves at outlets including Walmart, Publix, Safeway, HEB, Kroger, and Whole Foods.
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Just a few short years ago, Hampton Creek was an investors’ darling, using tech-adjacent buzzwords to pitch its mission of creating plant-based foods that taste great, starting with an eggless mayonnaise. It eventually reached a valuation, according to the company, of $1.1 billion.
But a string of public relations disasters have wounded the company. Just over a year ago, Bloomberg reported on a program that appeared to use contractors to buy the company’s own products in large quantities, possibly creating deceptive sales figures. Those allegations were investigated by the SEC and Department of Justice with no finding of wrongdoing, and an internal audit concluded the volume of the buyback program was smaller than Bloomberg suggested.
This May, after falling far short of a fundraising goal, there was a wave of firings and departures among Hampton Creek’s senior management and executives, some apparently motivated by cost-cutting. Then last month, at least four members of Hampton Creek’s board quit en masse, leaving CEO Josh Tetrick the sole member.
Update: This article has been updated to include CEO Josh Tetrick’s statement, and sales information from Hampton Creek.
