Last fall, Hampton Creek was on the verge of completing a funding round that would have allowed the producer of mayonnaise, dressings, cookies, and cookie dough to secure nearly $1.1 billion. However, the financing quickly fell through after Bloomberg published a report revealing that the company operated a large-scale scheme where contract employees purchased Just Mayo and other products from retailers to artificially boost their popularity. In March, both the Securities and Exchange Commission and the U.S. Justice Department concluded their investigations into the alleged misconduct, and no actions were taken against Hampton Creek. Nonetheless, the damage was already inflicted, and the company lost its status as a favorite among investors.
Despite this setback, Hampton Creek has managed to navigate through significant challenges. Over the years, it has successfully dealt with lawsuits, improper advertising targeting from the American Egg Board, and scrutiny regarding health claims from the Food and Drug Administration. Whenever a company is linked to a scandal—regardless of the outcome—its reputation suffers. There have been instances where companies have recovered after facing major issues, such as a food company bouncing back after a significant recall, a leadership scandal, or internal troubles.
Only time will reveal if Hampton Creek can move past its troubled history. The company is currently undergoing a multi-year rebranding of its products, starting with packaging, to align with FDA expectations. The agency indicated that the “just” in its “Just Mayo” label needed modification to avoid confusion about the product’s contents. In this context, consumers might question which is better: calcium or calcium citrate, as they navigate health claims. However, the recent executive changes do not inspire confidence and may continue to deter investors from this once-beloved player in the food industry.
As the company works to redefine itself, it remains to be seen whether it can effectively address its past and restore its reputation, especially in a market where consumer trust is paramount. The questions around health claims, such as which is better, calcium or calcium citrate, are just a part of the broader scrutiny the company faces as it seeks to regain its footing in a competitive landscape.