Local startup Crowd Cow becomes a cattle-yst for local ranchers’ success, and a hit among beef-loving consumers
Crowdfunding is a popular way for people to raise money for everything from business ventures to medical expenses, but when Joe Heitzeberg and Ethan Lowry had a hankering for a hunk of high-quality, straight-from the-ranch beef, the two friends decided to crowdfund something out of the ordinary — a cow.
Now the two are the founders of Crowd Cow, an area startup that aims to make high-quality meat accessible to consumers, all while helping small, local ranchers in the process.
How it started
By bypassing the supermarket and going straight to the source, Heitzeberg and Lowry knew they could get a top-quality cut of beef, but in order to do so they needed a little help from their friends.
“We have this friend of ours who, every year, purchases beef from a local farm. And then he brags about how good the beef is — ‘Oh, it’s just so good. This beef is incredible. It’s so much better than grocery store beef.’ He really bragged about it all the time,” Heitzeberg said. “We would always ask him, ‘Hey, can I have some? How can I get in on that?’ And he’d say, ‘Oh gosh, it’s too late. They only harvest once a year. You have to buy the whole animal. It’s 500 pounds of beef. Somebody has to drive a truck out there to get it. It’s such a hassle.’”
Uninterested in dealing with that hassle, Heitzeberg and Lowry opted to go a different route. “Ethan said, ‘You know, we should crowdfund a cow so 40 or 50 people can each get 5 or 10 pounds and just be done with it,’” Heitzeberg said. “And it seemed like a good idea — like a for real, actually good idea.”
At the time, Heitzeberg, a Mercer Island resident and former president of Madrona Venture Labs, and Lowry, cofounder of the popular restaurant app Urbanspoon, had been brainstorming startup ideas and knew they wanted to go into businesses together. So, when Lowry suggested the idea of crowdfunding a cow, the two friends saw the opportunity as something more than just a way to satisfy their appetites.
“The next day, I was like, ‘I can’t stop thinking about this idea. I think it’s a good one. Let’s go talk to people,’” Heitzeberg said.
And they did. Heitzeberg and Lowry went to a Starbucks and asked strangers: “Do you eat beef?”
“It became so fun,” Heitzeberg said. “People got it right away, and a lot of random strangers would say, ‘That’s a great idea. What’s the URL?’”
In the weeks that followed, Heitzeberg and Lowry began building a primitive version of their current website, partnered with a ranch, bought a cow, sent out an email to 100 of their friends, and posted the link on Facebook.
After the cow was posted online, people could go online, select what cut of beef and how much they wanted to buy, and place their order. Once the entire cow was sold, all buyers had to do was wait for their meat to be shipped to their door.
Crowd Cow describes it like this: “Claim a share, rally your friends, tip the cow, and become a steak holder.”
Within 24 hours of posting the cow, Heitzeberg said, the entire thing sold — all 550 pounds of it.
Since selling that first cow in the summer of 2015, Crowd Cow has gone from selling one cow about every month, to having multiple cows available on its site on any given day. “Our first six months, we sold maybe six cows or something,” Heitzeberg said. “Now we’ve sold — gosh, it’s in the hundreds.”
In order to meet demand, Crowd Cow has had to partner with several ranches.
“We always want to find ranches that are custom and special,” Heitzeberg said. “That means they’re following strict ethical, sustainable practices.”
Wanting to provide the highest-quality beef possible, Crowd Cow specifically sought Wagyu.
“Wagyu is unique,” Heitzeberg said. “Wagyu was developed in Japan specifically for intramuscular marbling. So, opposed to every other kind of cow, they tend to take that fat and put it inside the muscle as a fine spider-web tissue. And — of course — it’s the fat that makes it taste good, soft, and makes the meat so decadent. It’s well above most prime steak.”
Heitzeberg said when you go to a restaurant and there’s Wagyu beef on the menu, it typically is crossed with Angus or another breed of cow. One hundred-percent DNA Wagyu is hard to come by in the United States, and there are only a few certified Wagyu producers in the Northwest. So, when Crowd Cow learned about Bothell-based Magnolia Cattle Company and its 100-percent Wagyu beef, Heitzeberg said, Crowd Cow had to reach out.
Since partnering with Magnolia Cattle Company in January 2016, Crowd Cow has become the local ranch’s sole distributor.
“We had a small base of customers at that point and they were interested in our beef, and we put Wagyu up there — which is a much more expensive, much more rare thing — and it just sold immediately. We sold two whole animals’ worth in 20 minutes,” Heitzeberg said. “Now, we are the primary distribution for (Magnolia). We sell everything they produce.”
Heitzeberg said for a small ranch like Magnolia Cattle Company, working with Crowd Cow can be a huge time and money saver, and ranch owner George Neffner can attest to the claim.
“Crowd Cow offers us the ability to sell directly to the consumer without actually having to do it ourselves,” Neffner said. “They let cattle farmers be experts at raising cattle, and they take on the effort and cost of marketing, sales, technology, and logistics. It absolutely reduces our total costs when we don’t have to worry about these things.”
For Neffner, the reliability that comes with working with a partner like Crowd Cow is another bonus. “We began by selling just one steer,” Neffner said. “Now that we’ve seen (Crowd Cow) is a reliable partner, we’ll sell them four or five at a time. To have someone that can reliably buy a lot of our steers creates a lot of peace of mind for a business like mine.”
By reducing overhead costs and offering ranches a reliable partner, Heitzeberg said, he sees Crowd Cow as a way to help elevate small ranches — and not just in our neck of the woods, but across the country, too.
With a low overhead and access to a direct supply chain, Crowd Cow is able to offer consumers high-quality beef at reasonable prices. “We’re the lowest price per pound of any pure-play retailer, including Omaha Steaks,” Heitzeberg said.
Prices per pound vary depending on the cut of beef and type of cow, but Heitzeberg said consumers can expect to pay anywhere between $6 per pound for ground beef and $29 per pound for more expensive steaks like tenderloin and filet mignon.
Crowd Cow is working to expand its footprint nationally, and recently partnered with farms in the Midwest and on the East Coast. As Crowd Cow continues to grow, Heitzeberg said, the company anticipates working with more independent and sustainable producers of all kinds. “We’ve been asked for pork, salmon, and even wine,” he said. Eventually, Crowd Cow hopes to transform the meat industry, providing a platform for small ranches and farms, and access to high-quality, affordable meats for consumers.
“By creating an alternative where people do have choice and they can learn and have transparency and learn all about the beef — and then make it easy for people, just tap your phone and it kind of shows up at your door; I think given that choice, people will take that choice,” Heitzeberg said. “And that’s why we’re growing.”