Blue Bottle Coffee Gets Caffeinated With $25.75 Million in Funding
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Not in food and beverages, anyway. Sure fancy electronics are made at scale and we consider some of them to be best of breed.
But in food and beverages, best of breed is never, can never, should never be at scale.
Thus this just means another chain of coffee. Great. Even if it's an improvement on existing chains: it's bad for independent artisanals (just like Blue Bottle was) everywhere it goes. Which is bad for all of us.
I guess I just don't like "selling" the uniquely artisanal concept when it's no longer uniquely artisanal. It feels hollow and deceptive.
Kudos to Blue Bottle though. They're probably going to make a ton of money by being marginally (but still noticably) better than Starbucks.
Maybe you burned your tongue too much over the last few years, and that's why it tastes different.
From 2012 http://www.trueventures.com/2012/10/10/welcoming-blue-bottle...
"We’re also pleased to announce that Bryan Meehan, a good friend and an accomplished entrepreneur, has joined Blue Bottle full-time as Executive Chairman, contributing his significant expertise to all areas of strategy, marketing and operations. Bryan previously founded, grew and sold two premium specialty retail chains that share key similarities with Blue Bottle: 1) Fresh & Wild, an organic supermarket chain acquired by Whole Foods in 2004; and 2) Nude Skincare, a luxury natural skincare company acquired by LVMH in 2011."
But they can't, because we're talking about production lots that are on the order of a few hundred pounds of coffee, That doesn't scale far (a busy cafe will burn through 15lbs a day easily, plus wastage, retail bags, etc)
Like "off the rack, bespoke", it's self-contradictory. There is no such thing as "factory scale, artisinal" food. The abuse of marketing buzzwords to mask inferior production is as old as fake-yellow-cheese.
But at scale it is far, far easier to guarantee quality and consistency of product, and to gain the experience needed to achieve best-of-breed products.
Unless you are implying that the imperfections in the production process are part of the artisanality?
By definition, artisinal production is distinguished by type. That doesn't mean all mass produced things are bad. It just means the marketing is hypocritical, in a bait-and-switch kind of way. Which, admittedly, is more of a problem for those who are over-invested emotionally in a brand or product.
Using 'artisanal' as a "busienss strategy" was originally adopted to encourage such emotional investment. The fetishization of 'handmade', in part, related to its implied.natural scarcity. The latter makes it also hipster-fodder.
It doesn't matter if it's "artisanal". What only matters is if it tastes good. But if it tastes good because it's artisanal, then it's certainly a problem. Though not with Blue Bottle, but you and your snobbery. How the f#ck getting great coffee in more places is "bad for all of us". Do you actually read what you type?
> But in food and beverages, best of breed is never, can never, should never be at scale.
Of course, it can! Just look at wines, look at cheeses, look a damn puy lentils. Look at caviar. You are just making shit up.
The process of producing really good wine is very inefficient by comparison, and part of the reason it can be so good is because it requires (for example) very specific grapes that don't even exist in large enough numbers to mass-produce that wine.
I'm not even saying that mass market wine is bad. I've gladly drunk more than my share of dirt cheap wine over the years (and enjoyed it!) but I harbor no illusions that it's the best wine there is.
I could totally see coffee as being a similar thing- you could scale it up and get a pretty decent mass-market approximation of the original, and it might even be pretty darned good, but it's not going to be the same as the original. It can be high-volume, best-of-breed, or reasonably priced- pick any two. I think that's all the original poster was saying. It's not snobbery, it's just the realities of that industry.
Some people just like coffee and the coffee we've had for such a long time in America has been either burnt, tasteless, or mixed with a bunch of flavors such that we've forgotten that a well brewed coffee doesn't need to taste bitter.
We've also discovered that coffee acquires flavor not just from roasting but also from it's provenance (just like wine, the terroir matters) so now you can taste for coffees that have caramel notes, coffees that have bright cherry notes, etc.
Another reason that I think it matters is that the difference between shitty coffee and good coffee is so clear. We're not talking about trying to discern a slight difference. I've been drinking lattes in the Midwest while traveling and they are the worst thing ever. It's like the heated water, milk, and a touch of coffee. A great latte (like at Ritual Coffee Roasters) retains the taste of coffee (espresso) with a creamy blend of frothed milk.
If they start shipping out bags of coffee nationwide from a central roasting plant and keep coffee in warming pots, then I would say they've gone from craft coffee brewer to just another coffee chain.
... and they make a mean New Orleans iced coffee.
$26 million seems like a lot but perhaps this is enough to build a brand/business around. Both Starbucks and Peets had similar origins and are now worth $55 billion and $1 billion, respectively. And it always helps when your product is addictive.
Anybody has any insight?
(For more, here is a blog post on the whole shebang by True Venture’s Tony Conrad — who is, IMHO, the coffee hipster poster boy — in which he notes loftily: “What we saw and why we got involved is that James and his team are part of a handful of people who are founding a movement around coffee … We believe Blue Bottle Coffee is at the forefront of a ‘consumer movement’ or mega-trend in which consumers are moving to higher quality, artisanal micro-roasters of coffee, where quality, attention to detail, beauty and a distinctive experience are being sought over more mainstream alternatives.” Viva la siphon, apparently!)
Yeah, maybe on Market Street, Tony. The majority of the country (and the world) isn't going to pay $6 for a cup of coffee. That's reality.
Seems like a purely hype driven VC play to invest in BB. They make a great product, yes, but the SF micro-niche coffee clientele will have a very tough time scaling to profit in a country where Dunkin Donuts is considered great coffee - and Starbucks.
Also, not sure why BB would raise this cash from VC vs. debt financing. Whole thing is hilarious.
That may be reality, but it's entirely irrelevant as a cup of coffee at Blue Bottle costs less than $3.
Edit: photo: http://cl.ly/image/1l3b0F243S2d
It's a good product, but it will get destroyed due to scale, ultimately get acquired by Dunkin or Starbucks and everyone wins (founders, VCs) except for the customer. They always lose.
Starbucks doesn't seem to have a problem finding people to pay Starbucks-level prices...
Anyone else care to comment? It just doesn't intuitively make sense to me.
I'm on the other side of the country, and our small town has 3 independent coffee shops, multiple local roasters, and a Starbucks. This is your average college town, and there isn't an icebergs chance in hell you'd be able to get market penetration here.
edit: typo
This gave rise to lots of independents, but you never know what you're getting from one independent to the next. Just because you're an independent does not automatically make your coffee any good.
Blue Bottle has worked really hard to develop a reputation of really really caring about coffee, from farm to cup (and good ingredients in all food products). There are very few large independents who have a similar reputation (Stumptown comes to mind and Intelligentsia come to mind).
The last time I saw explosive growth in Coffee, which was cut way too short by a buyout from Starbucks for millions, was the Coffee Equipment company who manufactured the Clover machine. The Clover essentially elevated drip coffee to espresso status. The machine made drip coffee that tasted good, one cup at a time, and within 60 seconds. Blue Bottle isn't manufacturing anything, so my opinion is that it's going to be a long road to get to big growth.
That's great but how many people (apart from people trying to seem hip) really care? To the vast majority of people (those who get coffee at home/Starbucks/local cafés) it's a cup of coffee. Nothing more. They couldn't tell the difference between a $1.50 cup and a $6 cup and even if they could they'd still go with the $1.50 cup.
The reason starbucks is bad is because they let their coffee sit around for months in the supply chain, and they over-roast in order to compensate for the lost flavor as well as the tremendous amount of cream and sugar they put in every drink.
Again, I don't know how much good quality beans there are out there or even how you grade raw beans, but I suspect that average quality beans if roasted locally and brewed quickly (which was sort of the hallmark of Blue Bottle if I recall) will be an order of magnitude better than Starbucks right off the bat. If they organize their logistics around that I think they can scale a much better quality coffee than Starbucks.
Mega-Trend? I'm assuming their exit is via Starbucks
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