Hampton Creek Inc., a venture-backed vegan food company that was once a darling of Silicon Valley (where have we heard this before?), but then became embroiled in a buyback scandal, is now struggling to raise funds and has fired some of its top executives, Bloomberg reports (via GrubHub).
While Hampton Creek was aiming to raise $150 million in its latest round of funding “according to an estimate by private stock market firm Equidate based on a corporate filing from August,” the San Francisco-based company has only raised about $7 million, according to Bloomberg. A spokesperson for the firm has denied to Bloomberg that it’s only raised $7 million of its fundraising goal, but did not provide any other details.
Bloomberg also reports that Hampton Creek CEO Josh Tetrick “is looking to cut costs and fired several of his deputies, while a handful of other senior managers have exited the company in recent months,” throwing the startup’s leadership in turmoil. Tetrick last week fired his chief financial officer, chief operations officer and human resources chief, according to Bloomberg.
Hampton Creek’s reported struggles appear to show that an alleged buyback scandal has started to take its toll on the company. Here’s a little more about the scandal, via Bloomberg:
Bloomberg reported last year that Hampton Creek asked contractors starting in 2014 to buy up large quantities of its products from store shelves. A goal of the initiative was to show “huge sales out of the gate” after introducing its products in supermarkets. The practice drew U.S. federal scrutiny. In March, Tetrick told employees that inquiries from the Justice Department and the Securities and Exchange Commission had concludedwithout finding wrongdoing.
However, Tetrick says in an interview with Fortune that he has actually been on a hiring spree lately to shore up the team’s leadership holes. This includes hiring Erez Simha, formerly of as a new CFO and COO to replace Axel Martinez, who had been Hampton Creek’s CFO; Beverley Chadwick, formerly of Corsair Components and SquareTrade, as the newly-created vice president of finance and Luis Espinoza, formerly of Amy’s Kitchen, who was hired for the newly-created position of VP of manufacturing.
Per Fortune:
Tetrick said he was looking for people with discipline and operating focus who have “experience in the granular boring details of what it takes to operate in the midst of uncertainty.” He said he also wanted people who are “very resilient”—a nod to the recent turmoil at the company.
Tetrick also tells Fortune that “the company closed a round of funding that valued it at $1.1 billion, giving it coveted ‘unicorn’ status,” but did not disclose how much Hampton Creek raised nor who provided the funding.
Photo: @hamptoncreek