This is a follow up story for Coffee Pixels. If you're interested in reading how they got started, published about 2 years ago, check it out here.
Hello again! Remind us who you are and what business you started.
I'm Raivis Vaitekuns, co-founder and CEO at Coffee Pixels. Since 2017 we are producing edible coffee bars made from the whole coffee cherry. As we also use cocoa butter in the production of our bars, they look and melt just like chocolate, yet, the taste and energizing effects are just like from a cup of coffee.
There are few differences though - in opposition to liquid coffee, Coffee Pixels are waste-less, super-rich in antioxidants, and the provided wakefulness is much longer-lasting without the unpleasant peaks and crashes.
As a startup, we're still discovering ways to present this paradigm-shifting type of coffee for the consumer. The habit of drinking coffee is long-established, so to switch someone from drinking to eating is challenging, to say the least. Luckily our drive to the sustainable business model as well as the uniqueness of our product has attracted individuals - investors and industry professionals - that have helped to expand our vision, whereas the result we're working to take full ownership of the supply chain from soil to table while disrupting the existing coffee chain model, that is underpaying farmers and producing vast amounts of waste.
Tell us about what you’ve been up to! Has the business been growing?
In terms of sales - we're still figuring things out. Through the last 3 years, we have tested rather traditional and proven methods of marketing and sales - e.g. industry fairs, social media-based - content & influencer marketing. There have been some results, we see some customers, once they experience the benefits, they return and become loyal to our product. This gives us confidence, that the coffee bar has a future amongst other energy products. Yet we've also learned that for an innovation that intends to 'shift' long-established habit, the investment into education marketing has to be much greater than we could bear on our own.
Therefore, the last year was not growth-focused, instead, we had to raise an investment that was much needed for the company to continue the product-market fit research. Luckily we found investors and supporters who connected us to new networks and brought opportunities we didn't envision before. As a result, we pivoted our strategy to manage the ingredient supply chain and to disrupt the inefficient coffee production model where the farmers are underpaid and the environment is abused.
By the end of the year, we plan to launch a single-origin ingredient production in Colombia. Our goal will be to care for the biodiversity of the rainforests that produce our coffee and cacao comes, by compensating farmers much greater than what the existing model does. Since we use the whole coffee cherry, instead of only the bean, we envision the price paid for the whole crop of the farm could be as much as 5x more than it is now. Clearly other farmers will want to join, so as a result regenerating the forest while paying much more for the coffee is possible!
While at this point our production capacity in Riga, Latvia is up to 30K bars per month, the facility we'll be setting up in Santa Marta, Magdalena, Colombia will be capable to process up to 350K bars.
Last October I visited Colombia to meet our partners and to give a few lectures on our intentions and the envisioned business model. Farmers and professionals within the coffee industry scratched their heads about how nobody came up with anything like that before! They clearly saw how our model can make a significant shift in how much waste the industry produces, as well as how much farmers can benefit if they turn coffee fruit from waste into a value!
What have been your biggest lessons learned in the last year?
Up till now, our strategy has been focusing on sales - as it normally should be for a startup that's not yet bootstrapped. But what we learned from our 'smart money investors' is that we should have much more focus on the social and emotional aspect of the change we're about to bring. This understanding led us to a whole new strategy, that consists of a direct relationship with coffee growers, direct trade, single-origin & origin-based production. Of course, cash is important - it's the blood in the veins of the company! But once we have our story upgraded, there are many parties that are willing to join and to help - be it labor, knowledge, or capital. That's where we are right now.
Just before the coronavirus disruption began, we were planning a trip to Colombia in order to proceed with setting up the production facility. After Colombia, the plan was to visit our partners in the US with whom we plan to launch US sales. Unfortunately, these activities had to be postponed until the lockdowns are lifted. We still hope to start production in Colombia by the end of the year.
Build a business that makes the world a better place!
Reflecting on the last 6 months, I see us as a part of a larger group, that focuses on making entrepreneurship truly sustainable, while also commercially striving - Imagine a circular economy that brings value for each party involved in the supply chain - that is the core of 'Blue Economy' model, that our investor Prof. Gunter Pauli has described it in his economy books.
The entrepreneurs involved in the “Blue Economy” initiatives have been really supportive and our joining the group has been one of the best things we've succeeded with! Before, it seemed the only way forward was to do what everyone does - the loop of marketing to sales to marketing and so on. But once we met like-minded entrepreneurs, we found that there are possibilities to grow through unconventional means - be those B2B sales, or free promotions, or even financial support for us to work on our cause.
What’s in the plans for the upcoming year, and the next 5 years?
I could say we have started a new chapter in our story. The partnerships, the individuals that get involved with us - we all have one goal - a commercially viable circular economy. In the case of Coffee Pixels, our intention is to turn the coffee chain into a prosperous industry for all parties, but especially to heal the environment! We call this 'Triple H'- health for the forest, health for the farmer, and health for the consumer.
We start with the coffee bars, but the goal is to bring a variety of products that the mountain rainforests (where the coffee grows) can supply, with the main focus on the use of whole coffee fruit.
Explorations of coffee fruit and products that can be made of are already started. The fruit of coffee is one of the most undervalued nutrient sources - it is already there, a superfood available like no other. Since coffee is the largest soft commodity, the supply of coffee fruit is abundant - we plan to explore it and invite others to do the same!
Our long-term plan is to produce coffee fruit-based products at the origin in 3 continents. Once the model is polished in Colombia we see expansion to Asia by producing in Indonesia and supplying Europe from Africa (Madagascar and Rwanda). The same model as in Colombia will be applied - fully single-origin production, that drives reforestation while fairly motivating the coffee grower. In terms of measurable results, we'll be happy to count reforested hectares instead of earned capital.
Have you read any good books in the last year?
As a parent of two, my free time is quite limited, so most of my reading is focused on nutrition and health studies. Two books I'm happy to suggest are
Blue Economy by Prof. Gunter Pauli - A book that describes how innovative solutions heal the ecosystems while being fit for commercial success.
Another one was driven by a personal need - a suggestion I heard on I love marketing podcast by Joe Polish - Healing back pain Book by John E. Sarno. I have had back issues since I was a teenager. Sometimes the pain left, sometimes returned. In late 2019 I had quite a difficult time - some stressful events that brought the old pain back with new force. The teachings of John Sarno showed another perspective on pain and the reasons for it. As entrepreneurship can be stressful quite often, I believe this or other books by J.Sarno can be game-changing for the wellbeing of fellow business-men and -women.
Advice for other entrepreneurs who might be struggling to grow their business?
First - build a business that makes the world a better place! I still see people just look for a way to make money. While this can definitely work if the person has the right skill, drive, or personality. But to take the business to another level - attracting individuals and groups that wish to help, building, or joining a community - that requires a greater goal! Our story is evident proof of how that's possible. So the idea - it has to have a greater cause!
Next, I can suggest going out and sharing the vision with the world. If the person doing it is positively minded, focusing on opportunities, instead of challenges, things can & I would even say they WILL 'magically line up'. Once again, for me and Coffee Pixels, it has been just the case. Some of the events we've experienced seem like pure magic, yet now looking back, synchronicities like that seem normal.
Third - take a critical view - Does your cause really is solving anything? Is it needed at this time and place? Some businesses make up the problem only so they could solve it & I get it, it's fun! But the world we're moving is going has no place for artificial problems - there are plenty of real issues that need a solution!
Are you looking to hire for certain positions right now?
Not really. We look for ambassadors and opinion leaders willing to support the shift of the coffee industry to focus on sustainability. People who resonate with the 'Triple H' described above.
Where can we go to learn more?
With Coffee Pixels, we're still learning and adjusting.
At this point we're less active in marketing and sales, as we focus on our 'back office homework' - so I can't share much about marketing and sales.
But proper banding, marketing, content - all hat is coming! ;)
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