Could food startup Soylent go the way of Chipotle?

Food-tech startup Soylent has been under fire since it recalled two meal-replacement products in October after customers got sick. The brand, targeted at busy young professionals who don’t want to spend time and money eating conventional meals, is investigating and reformulating its Powder 1.6 and Soylent Bar after people complained of nausea and stomachaches, reportedly landing at least two in the hospital.

The mishap echoed that of another brand popular with millennials: Chipotle Mexican Grill, which lost 25 percent of its sales thanks to last year’s E. coli outbreak at the burrito chain. But could Soylent, backed with more than $20 million from prominent investors like Andreessen Horowitz and Lerer Hippeau Ventures, take the same hit?

Kelly Weikel, director of consumer insights at Technomic, says there’s a big reason why the incident is particularly harmful to Soylent’s image.

Soylent liquid meals reimagine daily nutrition
Play Video Soylent liquid meals reimagine daily nutrition

“It’s pretty clear these are really crucial issues for any brand, but especially when you have a brand that’s focused on the health and well-being aspect like Soylent or Chipotle,” she explains. “It’s especially damaging because it goes against what they’re trying to convey.”

In a blog post, Soylent says that it has been working “aggressively” to solve the problem and stresses that less than 0.1 percent of people felt sick during their tests.

“Our tests all came back negative for food pathogens, toxins or outside contamination,” says the statement. Soylent says that it believes the issue is within ingredients only found in its Powder 1.6 and Soylent Bar, and that it has not had complaints about its other products. The company adds that it will continue to investigate and share its findings with the U.S. Food and Drug Administration.

Weikel says it’s critical that Soylent regain customers’ trust.

“With Chipotle, it happened — and then happened a couple more times after that,” she says. “They have to make sure it’s not going to continue and figure out the problem and make it known that they’re making every effort that it’s not going to happen again.”

In August 2015, Soylent CEO Rob Rhinehart told CBS News that the company’s products were designed to provide a complete meal of essential vitamins, minerals and healthy fat with zero cholesterol: “This is not something that’s designed as a supplement to fill in the gaps of your diet, this is a full meal, it’s going to give you everything your body needs,” he said.

At the time, Soylent reported it had sold more than 6 million meals and had 50,000 customers.

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