Crowd Cow works directly with ranchers across the US, cutting out the middleman and giving farmers an alternative to selling calves to factory farms
If crowdsourcing makes you think of fundraising campaigns for smartwatches and wine coolers rather than sustainable food, youre not alone. But a new Seattle-based startup called Crowd Cow is hoping to change that.
Crowd Cow works like most crowdfunding campaigns. Every few days, the company hosts an event on its website featuring cows from one of the seven beef ranchers it works with on the west coast. There are photos and videos of the ranch itself, to give people a better understanding of the farmers and the cows on the ranch. Customers can then select cuts of beef they wish to buy from the ranch. Once enough beef has been purchased, the cow tips and customers become steakholders in the cow. Steakholders then receive their beef (frozen in dry ice) in as little as a few days. If the cow doesnt tip, there is no charge. But most Crowd Cow cows tip within one or two days.
Crowd Cow, which started taking orders in mid-2015, is part of a growing movement to promote sustainable meat production. The startup creates a market for more grass-fed beef, which keeps more cows grazing on pastures and gives farmers a more sustainable alternative to raising calves to sell to factory farms.
More and more people are waking up to the fact that factory farming is cruel to animals, detrimental to the health of humans, and unsustainable for the planet, said Brian Kateman, a professor at the Earth Institute at Columbia University. Thats why there is a growing demand for alternatives to conventionally produced animal products. This trend is expected to continue, particularly among younger demographics who are especially motivated to make food choices that are in line with their values.
As long as there is a growing or at least steady consumer base interested in local and grass-fed beef, Crowd Cow has the opportunity to serve that market niche, in turn creating a steadier market outlet for local farmers, said Richard VanVranken, a professor of agriculture and resource management at Rutgers University. Anything that allows farmers to increase prices received, reduce costs of production or in this case, marketing, and to plan for future production with a more stable and secure market is a good thing.
The majority of Americans buy their beef at grocery stores, where most of it hails from factory farms operated by large agricultural corporations. Conventional beef sales continue to dominate the fresh-beef market, with grass-fed beef accounting for only 1.4% of $18bn in sales in the United States in 2015, according to a recent Nielsen study. That said, the market for grass-fed beef is growing dramatically. In 2015, grass-fed beef sales increased by almost 40%, compared to a 6.5% increase for conventional beef.
The demand for grass-fed beef is driven by two factors, said VanVranken. One is the promotion of the general feeling that grass-fed beef is somehow tastier. The other is the assumption that grass-fed beef is somehow more humane and/or has less impact on the environment.
As demand for grass-fed beef grows, the meat industry is shifting to meet a new market. Many farmers now offer online ordering, while delivery services such as Amazon Fresh allow customers to place orders for grass-fed meat. But usually, these services are confined to small delivery areas.
Enter startups such as Crowd Cow and ButcherBox a monthly subscription service for grass-fed beef. Because they source from multiple farms, their range of products and delivery areas can be much larger than individual farmers, or even grocery delivery services. However, most services such as ButcherBox require customers to select from pre-selected packages of meat. Others are only available as a monthly service.
As of today, Crowd Cow ships to Washington, California, Oregon, Utah, Idaho, Nevada, Colorado, Arizona, Montana, New Mexico, Wyoming, Texas, Nebraska, North Dakota, and South Dakota. Joe Heitzberg, co-founder of Crowd Cow, thinks of the startups Seattle customers as Portlandia consumers people who are already buying grass-fed beef directly from farmers. Crowd Cow takes things a step further by eliminating the need to write a large check to a farmer to buy an entire cow, or to wrangle friends to go in on a cow purchase.
Traditional methods of buying directly from farmers can be confusing. Its easy for misunderstandings to crop up about everything from hanging weight to cuts of beef. Crowd Cow handles the slaughter side of the business, with the aim to make it easier and more transparent for farmers and consumers .
Youre not getting a surprise in a box, youre getting exactly what you ordered, said Heitzberg. Consumers can ditch their deep freezers and buy only the cuts of beef they really want or need, also helping to reduce food waste. Crowd Cows prices are comparable to Whole Foods or specialty butcher shops, ringing up at around $8/lb for ground beef.
Because Crowd Cow does all of the marketing and selling of the meat, it allows ranchers to focus on raising animals instead of selling them. That was why rancher Becky Harlow Weed, who was raised on the same farm she now runs, signed up. Before she started with Crowd Cow, she sold her beef to high-end butcher shops and, occasionally, restaurants. She said it was a daunting prospect to always have to try to sell the next steer. Now, she sells three steers to Crowd Cow every four weeks and gets a steady yearly payment. She also doesnt have to worry about marketing and sales of her steers. Running my ranch and raising my cattle takes up all of my time, she said. Crowd Cow takes over from there.
While Harlow Reed chose to sell her fully grown cows as beef before Crowd Cow, Heitzberg said many of the ranchers he works with opt to raise and sell calves at auction to factory farms. This puts more cattle into the factory farm system and reduces the supply of grass-fed beef in the market. But its also the only way many small farms can survive, Heitzberg said. To try and create more security for farmers, Crowd Cow creates purchase calendars with ranchers for six months or a year down the line, giving them another option for reliable sales. That means a lot to a small rancher who now doesnt have to worry how hell sell all of these cows six months down the line, Heitzberg said.
Armed with seed money from investors including the founders of Zulily and football great Joe Montana, Crowd Cow plans to expand nationally through what Heitzberg calls an aggressive timeline. (He declined to provide a specific date.) For now, the company handles a couple thousand orders per month. Its auctions usually attract an even split of new and return customers. Most of Crowd Cows customers order beef every two months.
Crowd Cow is facing a competitive landscape that could change quickly, given the increasing demand for grass-fed beef. That growing appetite could entice more conventional grocery stores to start selling grass-fed beef.
If consumers find that grass-fed beef is available significantly less expensive from traditional retail sources, what will keep them buying from Crowd Cow? VanVranken said. Coolness factor and convenience go only so far.
There are two main challenges for businesses that produce grass-fed beef, Kateman added. The first is that most people still choose food based on price, taste, and convenience, not concerns for the planet, for animals, or for their health. The second main challenge is that more and more people are side-stepping the negative externalities of animal products altogether by eating less meat and eating more plant-based foods.
At least for now, Crowd Cow offers consumers a sense of accountability thats not easy to find in beef sold at megafood retailers like Costco, where its almost impossible to find out whether a single pack of ground beef includes meat from multiple cows or which countries the meat came from. At fast-food chains like McDonalds, one hamburger patty can contain meat from as many as 100 cows.
I think part of sustainability is connecting consumers back to the source in a way that both parties feel good about it, Heitzberg said.
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