The State and Future of the Business of Coffee, Part 2 | Re:co Symposium 2018

This is the third and final episode of “The State and Future of the Business of Coffee,” a session recorded at Re:co Symposium this past April. This session gathered business leaders in Specialty Coffee to discuss the ways that the specialty coffee trade has changed in the past decade, the challenges businesses face today, and how we might prepare for the future. If you haven’t watched the preceding videos in this series, we strongly recommend going back to watch before you continue with this episode.

In the final panel of 2018 Re:co Symposium in April, Nick Cho asks the question: how do we respond to the challenges that were identified during Re:co this year? To find some possible answers, he leads a discussion between three founders of solutions-oriented businesses as they explore the approaches they’re using to push specialty coffee forward: Isabella Raposeiras, Roaster, Founder, and Owner of Coffee Lab; Ian Williams, Owner of Deadstock Coffee; and Pamela Chng, Founder of Bettr Barista.

Special Thanks to Toddy

This talk from Re:co Seattle is supported by Toddy. For over 50 years, Toddy brand cold brew systems have delighted baristas, food critics, and regular folks alike. By extracting all the natural and delicious flavors of coffee and tea, Toddy Cold Brew Systems turn your favorite coffee beans and tea leaves into fresh cold brew concentrates, that are ready to serve and enjoy. Learn more about Toddy at http://www.toddycafe.com.

Episode Transcript

0:00 Introduction

Hello everybody, you’re listening to the Re:co podcast, a special episode of the SCA podcast. I’m Peter Giuliano, the SCA’s Chief Research Officer. The Re:co podcast is dedicated to new thinking, discussion, and leadership in Specialty Coffee, featuring talks, discussions, and interviews from Re:co Symposium, SCA’s premier event dedicated to amplifying the voices of those who are driving specialty coffee forward. You can find videos of these talks on our YouTube channel – just follow the link in the show notes.

This episode of the Re:co Podcast is supported by Toddy. For over 50 years, Toddy brand cold brew systems have delighted baristas, food critics, and regular folks alike. By extracting all the natural and delicious flavors of coffee and tea, Toddy Cold Brew Systems turn your favorite coffee beans and tea leaves into fresh cold brew concentrates, that are ready to serve and enjoy. Learn more about Toddy at toddycafe.com. Toddy: Cold brewed, simply better.

I want to give you a head’s up that the Re:co Symposium and the Specialty Coffee Expo are coming to Boston this April. To learn more or to purchase tickets, visit recosymposium.org.

Today, we’re very happy to present the third and final episode of “The State and Future of the Business of Coffee,” a session recorded at Re:co Symposium this past April. This session gathered business leaders in Specialty Coffee to discuss the ways that the specialty coffee trade has changed in the past decade, the challenges businesses face today, and how we might prepare for the future. If you haven’t listened to episodes #36 and #37, we strongly recommend going back to listen to it before you continue with this episode.

On this episode of the Re:co Podcast, we are pleased to welcome the second panel hosted as a part of The State and Future of the Business of Coffee Session at Re:co last April: Isabella Raposeiras, Roaster, Founder, and Owner of Coffee Lab; Ian WIlliams, Owner of Deadstock Coffee; Pamela Chng, Founder of Bettr Barista; and Nicholas Cho, Co-Founder and Head Barista at Wrecking Ball Coffee Roasters.

In the final panel of the 2018 Re:co Symposium in April, Nick Cho asks the question: how do we respond to the challenges that were identified during Re:co this year? To find some possible answers, he leads a discussion between three founders of solutions-oriented businesses as they explore the approaches they’re using to push specialty coffee forward.

Also, to help you follow along in this podcast, I will chime in occasionally to help you visualize what you can’t see.

Take it away, Nick!

2:30 Where is specialty coffee today in the eyes of the average consumer compared to eight years ago?

Nick Cho: So I have the privilege of attending the very first Re:co Symposium nine years ago and I’ve been to a number of them since. And one special one was in 2011, which was in Houston, Texas. I was commissioned by Symposium to produce some video content that would be sort of entertaining and a little bit informative, that would show during Symposium. And little did I or anyone else know at the time but how much trouble that little video would cause.

Some of you have seen it but I went to the iconic Ferry Building in San Francisco and I grabbed a bunch of random passers-by and I ask them a few questions about their coffee consumption. What do you like about coffee? What don’t you like about coffee? And things like that. What makes for a good coffee experience or a bad one?

One question that turned out to be a big bummer for a lot of us was what does specialty coffee mean? What does that term mean? What did that thing mean? People on the street they had absolutely no idea. No one was even close.

That inspired a lot of work and research that has become a lot of the content for Symposiums ever since then, consumer research by Tracy Ging and Heather Ward in particular. Pretty much every year since then there’s been some content that was sort of descended from that original video.

Which made me wonder… What about today? It’s been seven years and this being the 10th Re:co X, it’s good to look back and reconsider certain things. So what if we went back to the same place, Ferry Building in San Francisco, and did the exact same thing. We grabbed people, completely randomly, and ask them the same question. What does specialty coffee mean? What would they say today? It’s been seven years. Will they say anything different? Let’s find out. Let’s revisit people asking that question in 2011, these folks and other folks included. And then we’ll watch people answering it today and see if we made any progress or if it’s gotten worse. If it could get worse!

At the end, if you think we’ve made progress, I’d like you to clap really loud. Okay, so let’s watch the video.

This is the one from seven years ago.

Peter Giuliano: Up on screen is the question “what does specialty coffee mean?”

Person 1: Yeah, but I don’t really know what that means. Exactly.

Person 2: Yeah, I don’t either.

Person 3: To me it kind of means like a frappuccino kind of concoction or something that isn’t really kind of coffee-ish.

Person 4: Maybe from a specific place in the country or the world like a coffee from like Holland or Denmark.

Person 5: I think for me that’s non-brand coffee, sort of individual coffee houses making their own brands of coffee, own styles. Yeah, we’ve got quite a bit of that in London. Although you gotta root around finding it.

Person 6: maybe special beans? I don’t know.

Person 7: would think that or does it refer to lattes and special drinks. I don’t know. Special brews?

Person 8: I was gonna say maybe different kinds of blends of coffees from around the world.

Person 9: I think it’s a marketing term. I’m not really sure what it means. It means whatever the person who is selling the coffee [wants it to mean]

Person 10: Somebody just told me, I asked him to describe it… They said there’s some kind of coffee that animals digest the beans and it comes out in their [faeces] and then they roast the beans and it has a flavor that’s to die for or to die from. I don’t know. But it’s interesting. Would that be specialty coffee?

Nick Cho: Seven years later…

Person 1: Specialty coffee, like a really good blend. That something that has like a really good, nutty earth-tone blend. And that’s the good specialty.

Person 2: Expensive. Yeah.

Person 3: Specialty means expensive, has like a unique flavor. I don’t know. To me is a little more sophisticated. I don’t care for it.

Person 4: Good question. I don’t… I guess the way I think of it is that it’s normally like single sourced.

Person 5: Yeah, more like expensive, premium, finer roasted.

Person 6: Specialty coffee I think it’s just more, for me, just seems like something that’s not that’s available through the chain.

Person 7: I have no idea. I just make myself coffee.

Person 8: For me specialty coffee would be low production, small farm, more hands-on approach less, commercialized, organic would be preferred, biodynamic.

Nick Cho: What do you think? Better?

I mean, I thought it was a big Improvement. You know, I think that the worst answer they gave this year was better than the best answer from seven years ago. And we still have obviously a lot of work to do. But I want another big round of applause. This is us. This is our industry!

We’re going to be hearing from some more folks for the ferry building in a few minutes in another video. But in the meantime as we shift focus from what’s been happening in the past and what’s happening today to the future of coffee business in the US and around the world, let’s delve into the science of demographics and lay that information on top of what we’re seeing in specialty coffee consumer behavior today.

Some of the people, the adults in the first video, were actually the parents of some of those kids. I wish I could tell you which ones….Before we moved on, I want to share the results of our poll real quick and you can actually see it on your app. But before we had a discussion, 46 percent of you said that “yes, we’re in a specialty coffee roaster bubble,” 49 percent said “no,” four percent “undecided” and afterwards 33 percent said, “yes, we are.” So that’s 13% less and 61 percent said “no.” a gain of 12 percent. It kind of shifted a little bit from the discussion. Again I encourage it be an ongoing discussion for everyone.

And now we spent a bit of time talking about market conditions from our point of view as specialty coffee businesses and spending some time really getting into the minds of younger and future consumer base.

9:30 Ian Williams, owner of Deadstock Coffee in Portland, on creating a unique space merging sneakers, coffee, and a welcoming space for people of color

I wanted to close out this session and the on stage portion of this Re:co this year, with a roundtable discussion with three of the most inspiring and interesting people I know in our coffee industry. We like to know about how we want to think outside the box. But so often we get stuck asking ourselves and each other, like, what can we do? Something fresh and new?

We talked about it during the debate. How do we respond to the challenges that we’ve heard over the past couple of days, especially yesterday? How can our businesses address equality and equity issues, especially for our customers? What realms of creativity have we not yet tapped into to expand our consumer base? How can our businesses maximize social impact beyond our rhetoric about helping coffee producers in their communities? And how can we grow businesses in light of increasing pressures that we’ve been again talking about a lot? And the challenges that are seemingly closing in all around us?

Well at this time, I’d like to welcome to the Re:co stage three friends of mine. Ian Williams from Deadstock Coffee in Portland, Oregon. Pam Chng from Bettr Barista in Singapore and Isabela Raposeiras from Coffee Lab in São Paulo, Brazil. A big round of applause for all of them.

We’re all friends and I’m really excited to have everyone here. Thanks for coming out. Each of them have cafes, each of them have businesses. They’re in different places around the world.

And so we did want to have an opportunity for you to be able to see what these places look like. And so we’ll get to that in a bit.

But Ian, you just flew in from Japan?

Ian Williams: Tokyo, yeah. Tuesday. Thank you for having me. After talking to these ladies, I feel real legit. If you guys don’t know these ladies yet, you’ll know them soon and you’re gonna feel real legit, too.

Nick Cho: Yeah, so let’s talk about Deadstock. What’s Deadstock about?

Ian Williams: We’re a sneaker team coffee shop.

Nick Cho: Sneaker themed? So what you got on your feet?

Ian Williams: So this is the Nike Vandal. It’s a custom that we did, we serve coffee at South by Southwest. Sprudge this year got to do the Roasters Village. This is the first time they’ve had a Roasters Village down there. We did paids for our employees who went down there, So not all the guys who worked in the shop got a pair unfortunately. But also fortunately, because that’s the cool thing about sneakers, that is kind of exclusive.

Nick Cho: So Deadstock?

Ian Williams: Yeah. So Portland, we’re in Portland, Oregon and Portland is the sneaker capital of the world. Nike, Adidas, Under Armour, Columbia, Keen, Mizuno all the footwear companies and the companies that work with the footwear companies, all the Jordan ads and everything that you’ve seen over the years, pretty much all created in Portland.

Nick Cho: It’s like the Silicon Valley of yeah of sneakers.

Ian Williams: Yeah. Exactly Footwear. Yeah. I mean it seriously. There are tons and tons of places for people to go and hang out, over 500 coffee shops in Portland. But no place where me or my friends felt comfortable hanging out to just talk about whatever. A lot of coffee shops have, plain white walls and they’re very clean and crispy and almost like hands off, white glove. But that’s not me, and that’s not a lot of people that I know. And not saying that that’s a bad thing. I just wanted a place where I feel comfortable. So instead of complaining about it, I just created it. So all the sneaker homies, the people who love sneakers, all the people are interested in the sneaker industry as a career or even just want to come and hang out. It’s a very barbershop feel. That’s Deadstock coffee.

Nick Cho: This is a good opportunity to go ahead and watch that video. Let’s talk check it out and let’s hear from some of your customers and friends. I went to Portland and asked them why do you come here? And how’s this place different from other coffee shops in Portland? Let’s watch that.

Person 1: It’s just like a dope community space, you come in here and everybody is very welcoming and loves to have loud conversations and talk about the latest sneaker releases and whatever’s going on in the sports.

Person 2: I really like a place that I can come kick it and hang out and not necessarily have to just be on my headphones.

Person 3: You don’t really think sports and coffee. Sounds like “okay. Well, I don’t quite get it.” But once I walked in there it made perfect sense.

Person 4: Deadstock couples the culture between hip-hop, basketball and sneakers and it’s place where I can talk about those things because I don’t get that most of the time.

Person 5: it’s the perfect mix of kicks and coffee.

Person 6: I saw it on Yelp. Definitely into shoes, into fashion, into clothes and just seemed like a place I needed to check out, definitely.

Person 7: And I don’t know. I think I’d come back again just because of the attitude. Like there’s a really chill, calm friendliness in there.

Person 8: And it’s the only place where sneakerheads can really come and collaborate and talk shop, and talk sneakers, and get together and just chill and have a drink.

Person 9: Been a fan of sneakers since I was a kid. and as I grew older, I started getting into coffee, tasting different coffee. And just it’s amazing to have them both come together.

Person 10: It has a little something extra. It has that sense of community and togetherness that….although I feel like a lot of coffee shops try to strive for it, they don’t achieve because it’s very “be respectful, be quiet, keep to yourself, we make really good coffee, who’s next?” kind of thing. and here it’s so not like that. Although the coffee is still really good.

Person 11: Portland coffee shops generally are kind of snobby. This place is known to be a coffee city. When you come here, it’s not like that. And even if it’s your first time here or you’ve been coming here for years, it’s just they immediately bring you into like every conversation that’s going in here. They want you to feel welcome. And it says it on the doors, like “snob-free coffee? This is the place to be.”

Person 12: Most other coffee shops, they’re rooted in coffee. Coffee is coffee. But we’re grounded in footwear and sneakers. So we come from diverse backgrounds.

Person 13: It’s locally owned. It’s also black/African-American-owned, which is harder to find in a city that isn’t necessarily so obviously diverse.

Person 14: Portland is known as a pretty white place. And I grew up here and in the neighborhoods where I grew up that was pretty true. But Deadstock’s one of the least white places that I hang out. And for me, that’s an important part of being a part of this community.

Person 15: We live in northwest, and there’s plenty of coffee shops there. But they’re white spaces and I’m very conscious of who I am as soon as I enter them. And I don’t feel like that here.

Person 16: It’s from what I see, not just sneaker culture, but diversity. Like this is the one shop in Portland where I know it’s going to be a good diverse mix of people. And not being originally from Portland and being used to multicultural situations and spaces, this is this is definitely one of those places where you feel good about being a person of color.

Nick Cho: Congratulations. More than half those folks were regulars. And at Deadstock, like regular is not just “oh, they come there all the time.” Like, you know them, you talk to them, you can name probably half the people in that video.

Ian Williams: Yeah, except for the lady who’s outside.

Nick Cho: Yeah. She said it was her first time. But I was really interested. As soon as she said “this is my first time here,” I’m like “well, okay cool. Let’s find out more about your experience.”

So the video closed with talking about the idea of like white space and such. And we’ve talked about race and somewhat we talked about uncomfortable conversations yesterday. And to some degree we’re still dancing around the issues a little bit. How do you take these ideas and actually integrate into business?

And so for you, being a black man in Portland, with the conditions that exist in Portland. I mean you talked about yourself. You said, “there’s not a place that I felt comfortable with my friends.”

Ian Williams: I’m from Newport News, Virginia. Shout-out VA! But I grew up in Portland, I grew up in the suburbs. Only black kid in the neighborhood. One time, my friend Jason, we were riding scooters. The Police stopped us and was like, “Mr. Williams, what do you got going on tonight?” And I was like, “I don’t know you, man.” I’d never met him before. So stuff like that, those are the things that stuck with me as I got older and decided what I want to do with my life.

I worked in the footwear industry for a while. I worked at Nike. But it was still always just that, like, I’m this outside guy a little bit. And I’ve also kind of kept myself as that outside guy. Not in a bad way, just like I’m a little bit different from y’all and that’s cool, right?

So just like realizing that at all times as I go through life or as I have been going through life and using it more as an opportunity to story tell or to illustrate or whatever fancy word you want to. Disrupt? I think I saw that in the last presentation. That’s what I’m supposed to do. I’m supposed to disrupt. I’m 31.

I mean, it’s really more just about doing dope stuff for my friends. You’re my friend. We do dope stuff together. We like sneakers, right? So really just finding that opportunity where I fit, where we fit, whatever.

Nick Cho: And in the video, it actually straight up by calls out a lot of the rest of the Portland coffee scene. Let’s unpack that a little bit. I mean, it’s the classic story that we see in America over the past few decades, at least. Well-intentioned people, they’re just doing their thing. They’re not trying to exclude anyone. But they’re creating a space that ends up catering to a certain type of person and maybe doesn’t make another person feel as comfortable. Those folks who mentioned race in that video, I just asked them why do you come to Deadstock and how is this different from other places? And that was the thing that was right on the tips of their tongues.

So, in that way, how does that play into the scene in Portland for you?

Ian Williams: People are always like “man, you’re a legend. You’re a visionary… whatever blah blah blah.”

Nick Cho: You go a lot of attention locally in Portland.

Ian Williams: Yeah, quite a bit. For whatever reason, I’m black, as a small businesses coffee, I was into sneakers. It’s in Chinatown, which is an area that’s kind of growing. They don’t really want to give it money. But it’s the last place to give money to for the city. Gentrifying.

I just always tell people, I just do what I’m supposed to be doing. Like I’m not doing anything special, I’m just here. So whatever opportunities, whatever interviews, whatever. This is a great opportunity, on a pretty serious stage. Literally. I just I just do what I’m supposed to be doing man. I’m just here.

20:45 Pamela Chng, founder of Bettr Barista in Singapore, on creating a coffee business that gives opportunities to marginalized people

Nick Cho: Cool, we’ll unpack this more. But in this at this moment, we’re gonna move on to Pam. So Pam came from Singapore.

Pamela Chng: Thanks for having me here.

Nick Cho: Bettr Barista, without the “e.” Just for trademark purposes, right?

Pamela Chng: Oh, no just not enough coffee, couldn’t spell properly.

Nick Cho: So tell us about Bettr Barista.

Pamela Chng: So we’re a social business, using coffee as our vehicle to change lives.

So in Singapore, we have a professional coffee academy, we have a roastery, I’ve got a mobile events business and we’ve got five retail coffee bars. And whole idea is we’re trying to use the entire value chain of coffee to impact people and change lives. And work with marginalized communities, like women, youth at risk, people with mental health issues, special needs, to basically give them the skills and the tools to lift themselves out of whatever situation they’re in. And coffee as that stepping stone, that journey and the destination for them to create a better life.

So we’re using the business of coffee to really try and do good.

Nick Cho: There’s an online company called SoulPancake who produced a video about Bettr Barista. We thought it was a great way to introduce Bettr Barista to you and for us to be able to visit via video. So let’s play that one.

Pamela Chng: There’s a huge inequality that’s building up in Singapore. You don’t see it. But it’s there.

Anita Sadasivan: That’s the reason Bettr Barista exists. Our role is to work with the marginalized community and give them a skill set so that they can find a job and become self-sufficient. Coffee is our way of doing it.

Tania Chew: Better. Barista is a professional coffee academy. And what that means is running professional coffee education courses. And then we retail and wholesale beans, machines and coffee accessories.

Anita Sadasivan: Most of our participants have a sixth grade education. So it’s very difficult to find a job that has any form of career progression.

Pamela Chng: We believe in people’s potential, no matter where you come from, what you’ve done. You have that ability to be more. And I think when you put expectations on people, I think it is inherent in human nature to want to live up to that expectation. The narrative in their head changes because look, there’s somebody else out there who thinks I can do this who believes in me. So why am I not believing in myself?

Shirly Ng: I’m a single parent with two kids. I had my first job when I was really young, 15. And then, you go to a lot of family issues, divorce and stuff like that. After I came in one week, I keep asking myself what am I doing here? Because I don’t love coffee. And then I realize what Bettr Barista does, helping marginalized women, people like me. So I thought, since people are helping me, why not give myself a chance? So I take on a course, and give it my hundred percent. Actually, more than that, just because somebody is giving me a chance to change my life.

Pamela Chng: For a long time I was struggling also with self-confidence and self-belief, actually very similar to a lot of what our students go through. We’re no different. There’s that self-doubt and self-questing all the time. But the only thing that’s stopping you is yourself. I give them tough love, because at the end of the day, it’s a discipline to expect more from yourself and to believe that you can do better, without beating yourself up. That’s the challenge, is to be kind and forgiving to yourself and yet expect more.

Shirly Ng: She has high expectations of every individual. So every time, if I’m not happy and really want to walk away, there only one thing in my head: that’s Pam’s face. Really, I swear! Every time I feel like quitting, her face will appear and tell me, “no.” I think she’s my real power to keep me going.

Pamela Chng: We act and behave just like any commercial business. We expect nothing less from ourselves. Because in order to compete in the marketplace, you have to deliver exceptional product and services that customers are willing to pay you money for.

We do focus very much on creating depth of impact, rather than breadth and scale. But I used to stress about all the time at the beginning because people would go “what? You’ve only had 20 students through? All that energy, time and money for 20 people? Is it worth it? That’s not sustainable.”

I think we’ve just become comfortable with the fact that, no, we are on the right track. We are doing things that are making a difference.

Shirly Ng: Bettr Barista is not just a school or a social Enterprise, they won’t stop there. They are more like my family. Being able to come to work every day, smile on the way to work. I think that’s the greatest gift ever.

Pamela Chng: We’re in the business of trying to help people. That is a long process, and it requires time. But the whole idea is if we can change one person’s life, they have the potential to change the lives of everybody around them and their children and the community. Eventually, we hope that they become changemakers themselves.

I’d like to think we’re helping to create people who will help other people.

Nick Cho: I’m constantly blown away by you Pam and the work that Bettr Barista does. You watch a video like that and think “it’s like a romanticized version of a thing. It can’t actually be so great like that.” It’s absolutely like that over there. And then you might think, if you’re a cynic like me, “like, okay, that’s all really cute and nice and really important stuff. But you can’t possibly be making good coffee. You can’t actually be on the cusp in that way, like a like a leading edge coffee company in Singapore.” It is absolutely top notch, a world-class operation. My wife Trish has been there a couple times, teaching Q grader classes. and I had the opportunity to visit in November and Trish and I looked at each other and said: “this might be the best coffee education facility in the entire world.”

So that all said, Pam, why did you do this?

Pamela Chng: Yeah, I keep saying it’s just moments of insanity. I think really is just the idea that business is such a powerful tool. We’ve been talking about the business of coffee for the past couple of days and the question really is what can we do with this business that we have in our hands?

Of course, we have to talk about profitability and sustainability, but at the end of the day, we’re a business about people. And if we’re not doing what we can to help make our people better, to help them fulfill their potential, then we have no business on our hands. So I think that, if every one of us could use this tool of business that we have and create a positive impact and create value in everything that we do, then we have opportunities to really start to address the problems that we’ve been hearing the past 48 hours. A lot of problems, a lot of issues. But if the 300 of us in this room right take just that one action every day and say what can I do to create value today? In 365 days, in a year when we all come back and have this conversation again, that’s over a hundred thousand opportunities to create value. That’s a lot of value and that’s a lot of solutions.

So to me, I love the coffee industry because we have this ability to cut across so many economies, sectors, people, cultures and to say “we can help a farmer in Colombia do this and we can help a single mother in Portland.” All of this is through coffee. So it’s an amazing thing.

Nick Cho: Pam taking us to church! The last thing that you said really strikes me. And one of the reasons that I wanted to share Bettr Barista’s story and invite you all to the Re:co stage, was to highlight the idea that as a specialty coffee industry, we’re really used to doing good works, to help people. We do that every day to help farmers and producers, you hear baristas talk about it, you hear barista competitors talk about it. Like that’s the business that we say we’re in, we want to be, and we wish we were in. There’s different sort of versions of that, that are the truth. But that wasn’t good enough for you.

Singapore’s is different than the United States, so I’m interested in your reflections on what you’ve heard over the past couple days. We’ll get back to that later

What was going on around you that made you make that a priority, the work that you do?

Pamela Chng: I think this is maybe a developed country issue, the idea of inequality. There are people who are benefiting a lot from the economic structures and systems that we have in place and then there are those who are falling through the cracks. So if we don’t address all of the people that are falling through the cracks, we’re going to get into a situation where there’s going to be growing unrest, growing inequality.

So it is a very pertinent question that we need to answer. What are we going to do about the growing inequalities in our societies?

Nick Cho: So it’s inequality specifically that you really want to address?

Pamela Chng: Yes, and coffee is just a vehicle do it because coffee is a universal language. People understand what it is and we can have conversations about these very serious issues over a cup of coffee. And when we engage with the consumers, it gives us an opportunity also to talk about conscious consumption and all these things that are important, in a very non-threatening, social kind of way. Which is what we do on a day-to-day basis.

32:00 Isabela Raposeiras, founder of Coffee Lab in Brazil, on creating a coffee space that is welcoming to all levels of coffee drinker and sourcing exclusively Brazilian coffees

Nick Cho: Now we’re going to move down to Isabella. Thank you for coming.

Isabela Raposeiras: Thank you so much. It’s an honor.

Nick Cho: You’ve been in this audience a bunch of times. What’s it feel like to be up here now?

Isabela Raposeiras: Nerve-racking.

Nick Cho: so Coffee Lab, a little bit of short history. So when did you start?

Isabela Raposeiras: Coffee Lab was almost 10 years ago. And the school, 2004, I guess.

Nick Cho: What did you do before? So I should mention you’re in São Paulo Brazil.

Isabela Raposeiras: Yes. I started working with coffee because I needed to pay for my tuition, psychology. That’s my major. And then I just needed money and that’s how I got into coffee. And then I went to work for Ipanema. That was my first job in coffee.

Nick Cho: And then you started your company, why? Why’d you start that?

Isabela Raposeiras: Because I needed to go on getting money. I really wanted to be a psychologist up to 2012. That’s when I actually gave up on trying. But I had to open the company because I had an offer and then I had to open a company, but I was already teaching and giving training and consulting and said, “okay, let’s be a business person.”

I never wanted to be one. I was always afraid because my parents used to be. And then, because I like human beings, I like psychology, especially the ones with trouble, who are sad, I love them. I still do. And maybe, the way I did things, they had to make sense for me. Otherwise, I wouldn’t be fun.

So I think Coffee Labs is a lot about people, as well. It’s funny that you said that because it’s about my relationship with my employees. That’s very important to me. And my relationship with the producers, whom I visit many times every year.

Nick Cho: so some people might not know but if you’re operating a specialty coffee company in Brazil, you can’t import green coffee from other places.

Isabela Raposeiras: We’re forbidden to import coffee from other countries unless they’re roasted. And roasting is my favorite thing on earth. That’s my speciality, I guess. When I open Coffee Lab and I said, “okay, I won’t be able to roast Kenyans or Ethiopians or those great Central Americans. How can I not be frustrated?”

Nick Cho: It’s like playing a piano was just like three keys, right?

Isabela Raposeiras: The challenge was I know there’s more in Brazil. I know we can do better. And that’s what we’ve been doing, developing the relationship with the producer so closely and we’ve been getting great amazing coffees. And I don’t feel frustrated anymore. Yeah, I don’t feel like having other coffees anymore. And I’m trying to be nice to Brazil here and it’s true.

Nick Cho: So one of the things that I really wanted to highlight about your work and Coffee Lab. You have constraints and restrictions and challenges that we in the United States don’t have when it comes to trying to run a coffee business. On top of that, of course, there’s politics and such and such. Like me, I’ve heard, sometimes I’m a little bit of a controversial figure in the local coffee scene. You know, so that said, what you’re trying to do in Coffee Lab, how does that contrast with what you might think everyone else is doing?

Isabela Raposeiras: I don’t think I’m controversial.

Nick Cho: But people make you feel that way.

Isabela Raposeiras: Sometimes they do. Yes, and sometimes I think it’s because I’m a woman in a very in a very male-oriented and chauvinist atmosphere. Maybe because I don’t do things the way everybody else is doing. maybe and then people like to see me or portray me as a controversial person.

I pay producers very high prices. Maybe that’s controversial. Bu my employees get very great wages, and we’re worried about the whole chain. And we educate the consumer. And we let them sit with the coffee, and that’s fine, and we let them know that’s fine.

Nick Cho: So you talk about your producers that you work with. Again, you’re in Brazil, and we’re imagining what that means. And then all of a sudden it hits you. You don’t import coffee. How do you get green coffee like within the country? Because it’s not like everybody else in Brazil.

Isabela Raposeiras: I go to the farms and I go to the regions and they come up to me as well. So before Coffee Lab started I was already working with Coffee Lab and I was already working with the producers. So when I started Coffee Lab, which is the roastery, and it was not ever supposed to be a coffee shop. I always said I would never have a coffee shop. And now they come to me and now I spot there’s great coffee. And I started working with the producers from the beginning, they don’t know they have good coffee some most of them. Sometimes don’t know they even have coffee.

And it’s hard because I look younger than I am. I’m a woman. And so the relationship with the producers can be challenging for them to trust me. Thank God, I’m a psychologist.

Nick Cho: You mentioned that you didn’t mean to or plan to initially have a coffee shop. So let’s see your coffee shop. Okay, so we’re going to play the video, and then can you describe what we’re seeing? Yes. Okay. Let’s go that video.

Isabela Raposeiras: Welcome to Coffee lab. We have a different interior design atmosphere. So we don’t have a counter or a bar you can go to. So when get into Coffee Lab, it’s sort of uncomfortable. So we have to greet you, like Ricardo is doing right now. We have to greet you and let you know that there’s free water for you to serve yourself. Then we give you the menu and then we say you can sit anywhere you want and then when you’re ready to order you go to the kitchen and order. And the kitchen is open. Then we take the order to you. That’s how we work. And we pour, brew the coffee at the table. We try to do everything at the table.

This is our roastery. And you can walk through there. So all the customers, they walk through our coffee operation and our roasting operation. And I like that engagement. I love that. I never want to lose that opportunity. So you see it’s all open. Because I never wanted to have a coffee shop. So this is not a coffee shop. It’s my lab. This is one of our Baristas and he’s explaining what we call our rituals. We have some tasting rituals in our menu so we can teach our customers the things that we professional know, but in a fun way, in a logical way. We like them to have fun and they get to the conclusions that we as professionals have gotten ourselves.

So we like to have fun. Our social media is fun. Sometimes too much, I guess. So this is the kitchen where you order. She’s taking the order. So we have a bigger staff because of the way we operate, we have to have more baristas. And we wear gym suits, and I love our uniform.

Upstairs is our classroom. This is our multi-gender restroom. We stand for our values and beliefs and we do it in our social media. This is one of the classrooms and we roasting classes and we have barista and home brewing classes and coffee drink classes. We had 1600 students last year.

Yeah we’re very happy with our school. So these are all classrooms. We have classes everyday. And education is a huge part of our DNA and that’s why maybe we have those rituals on the menu. This is Open Lab, it’s staff training, that we open to our customers to come, but it’s always a staff training.

Nick Cho: And everyone wants to know: what’s the best airport to fly into to go there?

Isabela Raposeiras: GRU airport.

42:45 Discussion on ideas for innovating in the hospitality space

Nick Cho: Yeah, so we don’t have that much time left. We could go on for hours just with the three of you and it’s been fantastic. We have about seven eight minutes left.

I did want to mention, again, we started out this particular panel talking about the idea that very often as we talked about in our earlier panel, things feel constricted and things feel like bubbles. Sometimes things feel like the market is such that there’s a lot of people trying to do the same sort of thing.

And so for this particular session, we’re really trying to think what are examples, what we can introduce to the Re:co audience here, to all of you, that are really doing something truly outside the box. Not just like, “oh well instead of the three group espresso machine, we have a five-group espresso machine” or “instead of this kind of would we have that kind of wood” or like “instead of having a mustache, everyone has a beard,” kind of thing. Which is a lot of the same sort of stuff.

Like, trying to think what are ways that, as we talked about yesterday, really break outside that box. And so Ian, for you, talking about other demographics that actually don’t drink as much coffee and that we can reach them. For you, in terms of Portland and diversity, like we saw in the video, a lot of people are seeking you out because it’s a special place. And you’ve also had the chance through Deadstock in your work, travel the world and see a lot of other places. And so I’ll put you on the spot: like how did that all come together? And what ways does looking at culture and race differently within the specialty coffee context provide a business opportunity for all of us?

Ian Williams: Yeah. Well, I mean before I can change things, I have to understand where things currently are. So I have been blessed with lots of opportunities and have a lot of friends both in coffee and outside of coffee who do things all over the place. So I’ve had the opportunity to go out and actually see what coffee is like elsewhere. It was very important to figure out what it was like in Portland before I could do anything.

And, I don’t know, about three maybe four years ago I was at Coffee Fest in Portland. I walked the show, right when I was first getting into the coffee thing, and I just remember a lot of people just looking at me and being like “stop talking.” I’m like “I’m opening up a coffee shop” and getting back “cool story.” But then the person right in front of me is like “compostable bags, blah blah blah, numbers” because it looked the part, but I don’t. So, how come I can’t get some words? How come you can’t help me? And that’s a true story by the way, so if you’re in the crowd, your bad because your boy is talking right now.

Then I went to the next booth, they were very nice to me, and I’m like “cool. I’ll take all of it. Like let’s do it. Let’s get it going.”

Nick Cho: Well, that was one of those moments where if there was a camera phone recording that incident, this is the Starbucks right now. It’s not just one company.

Ian Williams: No, it’s not. It’s an industry as a whole, if we’re being completely honest.

Coffee and sneakers and stuff is giving me an opportunity to go out and actually see what it’s like elsewhere. And shout out to social media as well.

But that’s important before I can go in and figure out how to change it. And again, I’m just doing what I’m supposed to be doing. But what I’m supposed to be doing is…I’m not trying to change them. I’m just trying to make it a place where we feel right.

Nick Cho: It’s sort of a cliche, but you’re being your authentic self. Like you’re doing your thing the way that you know how. If you don’t mind me sharing, you shared that sometimes the attention is overwhelming. It’s like I don’t want to be known as this outlier, sort of miracle story, sort of situation. Like make a movie about you, with Sandra Bullock or something. You don’t want to be that. you just want to have a successful business that’s known for the good things that you do. You are an outlier in that sort of way.

Isabela Raposeiras: You said, “I’m not trying to be special. Yeah. I’m just trying to be me” and that’s the point. You’re not trying to be whatever you think you have to be. You’re just trying to be comfortable. That’s what not a lot of us are doing in the specialty coffee business. We’re trying to be “specialty coffee.” What is it? We’re so young. Are we yelling, I mean as an industry?

We have to be whatever feels comfortable. To express that. What does [specialty coffee] mean? You’re going to be expressing yourself and specialty coffee better if you feel comfortable and not if you try to be something “whatever.”

Nick Cho: Pam, it’s just so exciting the work that you’re doing. It’s really something I hope you all tell other people about. Google them and see all the stuff and just bow down because they’re really doing all that stuff that you imagine that someone might be able to do, someday. They’re doing that stuff stuff today.

I am really interested in your reflection over the past couple days here. We have we tend to have an international audience and engagement for Re:co Symposium over the years. But generally speaking, on the producer level, different producers from different countries, but you coming from Singapore which obviously doesn’t grow coffee, and seeing the cultures, es when it comes to some of the social things as well as the business talk that we’ve been having…. what are your reflections in terms of how that is different from or very similar to your Singapore situation?

Pamela Chng: I think we have a lot of similarities, just because we’re human beings. And a very rich country, so consumer behavior is very similar.

But also, like America, we’re really in the hub of a lot of countries around us. So Singapore’s actually in the middle of Asia. And to me, I think Asia is where a lot of specialty coffee growth and innovation and development is going to be in the next 10 years.

So a lot of these conversations that we’re having here, that message goes globally around the world so that we can learn from each other and not repeat the mistakes that have been made.

Because at the end of they we grow the global industry, that’s a win for everybody.

So I hope that I can go back and share a lot more of what we’ve learned here and say, “okay, these guys have been doing this for a lot longer, 10 years, and what can we learn and how can we do it better and different? And do it authentically?”

Nick Cho: Isabela, last questions for you. And again, bringing you here and talking about Coffee Lab and the amazing work that you’re doing there, for me the message here is really about trying to innovate where people have seemed to have run out of ideas.

And so tell me what are the guiding principles? Coffee Lab, as you can see all see from the video, is a very unique customer experience, it’s different from anywhere else in the world. So what informed that? What led to that for you?

Isabela Raposeiras: I ask that myself very often, because if I want to replicate, I need to answer that to myself. Maybe because I love gastronomy. I’ve always loved astronomy and cigars and all that you can taste. So coffee, especially in Brazil, some of you, I don’t know if all of you know how bad our everyday coffee is in Brazil?

Nick Cho: We talked about it yesterday. We take this coffee and that’s just domestic consumption, right?

Isabela Raposeiras: It’s really bad. And I don’t want to roast it darker just because people are used to. I don’t want to do what people are used to having. And so, how can I just make money doing whatever I feel like and I like and I know, as a specialist? So I had to come up with ways to engage the audience without saying that what they have been doing so far was wrong. We have to respect people’s repertoire and actually use it to our favor.

And we don’t say some words, for example, to the consumer. Like “acidity.” Acidity is a bad word for the consumer.

Nick Cho: In Brazil or you think in general?

Isabela Raposeiras: In general, but especially in Brazil. They don’t know what acidity is. They don’t know how to describe acidity. So we come up with ways to say the same thing and take the consumers mind exactly to where we want. And for them to like that. And we actually suggest to the consumer that psychology. And that’s using psychology in our favor and it’s in their favor, actually.

There’s one thing that I think is very important is to be welcoming. We have to be extremely nice as servers. I like service. So why should I be a snob or serious? And having the service at the table can actually engage the consumer even more. It’s more expensive. It requires a lot of training, every day.

For example, can I tell you one of the things we do? When you go to a Coffee Lab and you order an espresso, we ask “is it the first time you have espresso here?” and then obviously if it is you go like, “yes” and then why are you asking me this?

And then you go back to your seat and then we take to you the same espresso extracted in the same group, but with two different cups, a small one and a big one. That’s so simple, but that’s enough to make the consumer just be surprised.

Nick Cho: “Why did you bring me two cups? I only ordered one!”

Isabela Raposeiras: if that person would just take that espresso thinking of bill that they’re going to have to pay later on, or the date later on too, they’re going to pay attention to the cup in a nice way. So we just tell them to go through both cups, and then they will realize that they taste different.

It doesn’t matter which one is going to be the best. And so these kind of things that we came up with make people pay attention. So we have “big cup-pers,” a lot of them, actually. Because espresso does taste better in the big cup.

Nick Cho: Well, I wish you could keep going but we’re out of time.

You know again, we’re not here to take any of these examples and say “now this should be the new exposed wood brick/whatever/wall trend in coffee,” but to help inspire folks like what are those things that we can bring out and innovate in our own ways?

55:30 Outro

That was Isabella Raposeiras, Ian Williams, Pamela Chng, and Nicholas Cho at Re:co Symposium this past April.

Remember to check our show notes to find a link to the YouTube video of this talk and a link to the speaker bios on the Re:co website.

This was the final 2018 Re:co Podcast, brought to you by the members of the Specialty Coffee Association, and supported by Toddy. Thank you for listening!

Talks, WatchSCA StaffFebruary 11, 2019Re:co 2018

The State and Future of the Business of Coffee, Part 2 | Re:co Symposium 2018

Special Thanks to Toddy

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