Two Swedish brothers became half billionaires yesterday, after they figured out how to make milk from the byproduct of oat bran more than than 20 years ago. They founded Oatly Group, which went public on the Nasdaq yesterday (ticker: $OTLY) and raised $1.4 billion, closing 19% above its IPO price of $17 per share.
In July 2020, Oatly secured a $200 million investment from private equity giant, Blackstone, which also included celebrity investors, Oprah Winfrey, Natalie Portman, Jay-Z and Howard Schultz, valuing the Company at $2 billion. As of yesterday's close, $OTLY was valued at $13 billion. A 6.5x on Blackstone's investment... not a bad return for 11 months. (OK Dogecoin investors not every asset can return 60x in 4 months)
Oatly has been known for its quirky packaging and tongue-in-cheek marketing. After a disastrous Super Bowl commercial, in which their CEO sang "Wow! No Cow" (in hindsight was probably a genius marketing move), Oatly gave away "I totally hated that Oatly commercial" t-shirts.
Short Squeez Takeaway: Oatly's success is a byproduct of health-conscious Millennial and Gen Z wokeness, who are concerned about the impact animal-based products have on the environment. More consumers shift to plant-based foods, which has also lead to the popularity of other companies such as Beyond Meat. Oatly has also been great at milking the environmental and social angle e.g. drawing attention to how consuming cow milk results in more greenhouse gas emissions. Investors becoming more sensitive to environmental, social and governance ("ESG") issues is great news for companies like Oatly.