The founder and CEO of Chobani, a company that quickly captured more than 20% of the US yogurt market, has a clear mission: He wants to prove that capitalism and humanitarianism feed off of each other.
Hamdi Ulukaya, a Turkish-born entrepreneur, says his company is proof that those principles work.
He has donated millions of dollars to fight food insecurity and to disaster relief efforts around the world. Chobani is also a part of the Tent Coalition for Refugees in the US, which advocates for the hiring and training of refugees across the country. As Ulukaya told potential investors in an initial public offering filing in 2021, Chobani "operates on a simple fundamental principle, that we do well by doing good."
But questions remain about whether it's possible to focus on the greater good while catering to shareholders who demand ever-widening profit margins.
Chobani was slated to go public in 2022 but withdrew its filing as market conditions deteriorated. In a discussion with CNN, Ulukaya said the company still has plans to go public when market conditions stabilize.
Before the Bell sat down with Ulukaya at the Global Inclusive Growth Summit in Washington DC to discuss corporate responsibility, his economic outlook and more.
This interview has been edited for length and clarity.
Before the Bell: There's an innate idea that humanitarianism and capitalism are separate entities. How do you combine the two?
Hamdi Ulukaya: The capitalistic view is that the core purpose of business is to create value for the shareholders. But if you look at it from another dimension, and this was the prevailing view before the 1970s, the core purpose of business is to create value for all shareholders. That includes workers, your community and the world altogether.
The only way to get people on board with that perspective is to convince them that it's good for business. When you meaningfully get involved, it becomes an enormous engine for your company. But how do you convince a company that only focuses primarily on profits to broaden its focus? That's the biggest challenge.
The concept of greedflation has been in the news lately, that's when companies use the cover of inflation to unnecessarily raise prices and increase their profit margins. Is it a real problem?
I make food, and I'm looking at the costs — where it was six months ago, where it was one year ago and where it is today. It's the same perspective, that the prices are still high out there.
You do see some selfish acts and it seems like it's all unified somehow. Of course you have to pass on some increases in prices to customers, but those inputs are coming back down and that hasn't been reflected in the price of goods: They're still elevated. It is troubling. I think food makers have to be very conscious that people are having a hard time affording food.
I want to believe that the employees of these companies want to do the right thing. I wonder if they're succumbing to financial market pressures that demand they show growth and strong metrics.
Are there IPO plans on the horizon for Chobani and if so, how will you navigate pressures from shareholders to do the same?
We've passed $2 billion in sales and we're growing 20% to 25% year-over-year. We don't have any external pressure or demand to go public. There is no cash-out scenario.
That being said, we have a few reasons we want to go public. One is our 2,000 employees — they have shares and I want them to have access to that money [Ulukaya has given his employees shares of the company worth up to 10% of Chobani's total value]. The second is we want our manufacturing to grow, product-wise and geographically. So this is not an exit. But if going public is going to fuel our journey then I welcome it.
The year we were supposed to IPO was very loud, very crowded and there were a lot of moving parts. It didn't look good and we thought it might damage our journey so we decided to stop it. But we are OK to be in the public market. I think people understand what Chobani is all about and they understand that this is tomorrow's brand and tomorrow's company. I think the external conditions need to be settled, and we will reevaluate, but still I'm really open to it.
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