Coffee the Conscious Way: Why We Invested in Copper Cow Coffee

Authors: Amanda Donohue-Hansen, Cultivian Sandbox Managing Director, & Alex Behar, Cultivian Sandbox VP

At Cultivian Sandbox, we love coffee, but we all love it differently. Before the pandemic when our team was still going into the office, Nick always went for Nespresso. Dan stopped at Starbucks every morning on his walk to work and picked up a cold brew. Others simply liked whatever brew was in the coffee pot. As for Alex and I, we started our day off right — grinding beans and using a French Press or Chemex pour-over to make a quality cup of coffee. We both grimaced at the Keurig machine at the office and would sneak away in the afternoons to Stumptown or a local shop for a cortado. As foodies, coffee is just an extension of what we already love to do. We felt much better about throwing away coffee grounds and a compostable coffee filter than throwing away plastic K-cups or a disposable cafe cup. And our wallet certainly appreciated less frequent trips to the cafe. But it wasn’t always practical to make a quality cup of coffee at the office, where we consume most of our coffee. That changed when we met Copper Cow Coffee (“Copper Cow”).

In 2020, we were introduced to Copper Cow not initially thinking about investment, but really just because we love getting to know awesome female founders in the food industry and because Alex and I really wanted to try Copper Cow’s product — single-serve pour-over coffee kits. And so the story of becoming an investor in Copper Cow actually started with becoming a loyal customer. And as we shared Copper Cow with our friends, family and Cultivian Sandbox team and got to know Copper Cow’s business more, we realized something — maybe our coffee habits weren’t so unique and that Copper Cow was actually on to something.

A few of us on the team are part of the largest living generation in the US — Millennials — and we are more diverse than any generation before us. And do we love coffee. It turns out, Millennials drink more coffee than any other generation, and as such, are the largest coffee consumption group in the US. And not just any coffee, the majority of Millennials consume specialty/gourmet coffee and consume it daily [i][ii][iii]. A study sponsored by investing platform, Acorns, suggested that Millennials spent more on coffee than retirement savings. That’s a troubling statistic, but also telling that leading investment apps use coffee as a point to attract new users and more dollars on their investment platforms [iiii].

It is the Millennial generation’s love for specialty/gourmet coffee — and a keen appreciation for its taste, quality and source — that has driven a third wave in coffee, a wave we’re still riding. For our grandparents, the first wave made coffee accessible and necessary in every home, but gave few choices beyond Folgers. For our parents, the second wave turned coffee from necessity to culture and indulgence. And now Millennials are taking this further, gravitating towards experimenting with new origins and brewing methods, as well as seeking unique experiences.

Most recently, we are taking these experiences from the coffee shop to our homes, and with that has come a plethora of gadgets, single-use plastics and attempts to bring new flavors through artificial and high-sugar flavors.

Copper Cow Coffee is at the forefront of the third wave with a product and experience that resonates with Millennial consumers and does so in a more sustainable way than existing offerings, going all the way back to the bean:

• Robusta 2.0: Robusta has historically been associated with inferior quality coffee, mostly due to a lack of quality differentiation in robusta growing regions. Copper Cow is changing this misconception, and has developed relationships with suppliers that source beans with a superior taste, matching desired dark-roasted nutty flavor profiles desired by consumers (and don’t forget robusta’s extra caffeine kick!)
• Responsible and ethical sourcing: Copper Cow has built transparency into its suppliers’ grower network and ensures that growers are fairly paid (typically double the market rate). This not only supports poverty reduction in coffee-growing communities, but also incentivizes investment into growing practices to deliver higher quality, more environmentally friendly coffee
• All about flavor, naturally: Copper Cow has taken the Vietnamese approach to coffee and elevated it further through unique flavor combinations that meet the tastes of the US consumer. These flavors offer a treat using natural ingredients (real lavender sprigs) rather than artificial flavor syrups (and without the 400 calories of regret associated with a Caramel Frappuccino). Favorite flavors on our team include Churro, Lavender and Rose!
• Pourover without the snobbery and single-use without the plastic: Copper Cow provides the experience (and a few precious moments to oneself in between Zoom meetings) of a pour over without the need for specialized equipment, barista training, or a trip to a cafe — just grab a mug. They also provide the flexibility and convenience of single use without the guilt of plastic pods. While the form factor is nothing new to the Asian market, Copper Cow has found a way to translate this popular form factor in Asia to the US consumers’ desire for accessible, sustainable, single-use pour over coffee
• Making sure loyal followers can reliably get their fix of both caffeine and novelty: Copper Cow has crafted a subscription offering that provides a regular supply of new and proven flavors in a monthly box — the fact that so many who try the coffee come back to commit to regular supply is a testament to their cult following.

At Cultivian Sandbox, we’re especially excited about investment opportunities where emerging downstream consumer trends can be met through innovation and partnership with upstream agriculture. Ultimately, consumer demand has a powerful and transformational influence on how we produce our food. We believe that brands (both established and emerging) can be a force for upstream innovation. For example, Danone recently partnered with our portfolio company, Full Harvest, to use its ‘rescued’ lemons in Danone’s Two Good dairy snacks, appealing to consumers’ interest in products that reduce food waste in our supply chains. Similarly, consumers’ demand for more sustainable (and delicious) protein has led to Cook’s Venture success introducing a new pasture-raised chicken that promotes regenerative agriculture, human health, and animal welfare.

And we see similar potential for Copper Cow’s brand to be a model for more sustainable and responsible coffee for consumers and producers alike. The Copper Cow team has been incredibly thoughtful in setting up its supply chain and product offering to deliver on these goals, which has been critical to them building an authentic brand. In a market as fragmented and competitive as the coffee market, we believe that this is central to Copper Cow’s success to date and is the primary reason we’ve chosen to back them for continued success. We can’t wait to see what comes next and feel privileged to be a part of the next phase of growth.

Don’t believe us? Watch for yourself on Shark Tank on Friday, May 21st and taste for yourself here.

[i] Bloomberg

[ii] National Coffee Association (2017). Millennial Behavior and Attitudes. https://nationalcoffee.blog/2017/05/16/infographic-the-millennial-coffee-market-is-totes-lit-tbh/

[iii] National Coffee Association (2017). National Coffee Data Trends. https://nationalcoffee.blog/2017/03/28/from-basic-boomers-to-specialty-snowflakes-national-coffee-drinking-trends-2017/

[iiii] https://www.vice.com/en/article/jpk8g8/millennials-are-spending-more-on-coffee-than-on-retirement