Blue Apron Holdings Inc. Saw its best day in six months after announcing a tie-up with a hot brand: Beyond Meat Inc.
The struggling meal-kit company will begin introducing products from the alternative-meat startup on its menus in August, New York-based Blue Apron said in a statement. The shares rose as much as 22% on Tuesday, their biggest intraday gain since Jan. 15.
The tie-up may breathe some fresh life into Blue Apron, whose stock has plummeted more than 90% since its 2017 initial public offering turned out to be one of the worst-performing in recent history. Meanwhile, Beyond Meat shares have gained almost seven-fold since their May debut as faux meat has taken off across restaurant and fast-food chains. Beyond Meat extended those gains Tuesday, adding as much as 1.6%.
Blue Apron’s struggles stem from the meal-kit industry’s challenges attracting and retaining customers. Although subscriptions were originally marketed to people who wanted to cook but didn’t know what or how, it was soon beset with complaints: The meals were too expensive, you had to plan ahead, and people felt guilty throwing away all the packaging required to keep ingredients fresh. The nascent meal-kit industry found luring and retaining customers required margin-eating discounts and often didn’t work.
In a bid to reinvigorate growth, Blue Apron got inside brick and mortar retail, but Costco Wholesale Corp. Ultimately dropped the meal-kit boxes to make space for seasonal products.
More must-read stories from Coins2Day:
—Meet the A.I. Landlord that’s building a single-family-home empire
—You might have longer than you think to invest for retirement
—Will the Fed cut interest rates to prevent recession? 6 predictions
—Schwab’s ‘Project Bear’ uses A.I. To predict when investors are getting nervous
—When the next recession hits, four good things could happen
Don’t miss the daily Term Sheet, Coins2Day‘s newsletter on deals and dealmakers.