People's Coffee roasts 1800 kilograms each week. Photo / Supplied
People's Coffee roasts 1800 kilograms each week. Photo / Supplied
Wellington-based wholesale coffee business People's Coffee is seeking to raise $1.5 million to fund its expansion.
The business which started 18 years ago will later this week launch a crowdfunding campaign on Pledge Me, offering up 12.5 per cent of its shareholding.
Shares will be on offer from $250, andso far 450 people have pre-registered interest in the capital raise.
This is the first time the roaster of organic and Fair Trade coffee beans has sought outside capital since its inception in 2004.
Part of the capital will be used to hire staff to create a sales and marketing team as it pushes further into the grocery sales channel.
People's Coffee expects to triple its production of coffee and open a new cafe at its Newtown headquarters in Wellington following the raise.
It currently roasts 1800 kilograms each week.
People's Coffee founder Matt Lamason said the investment raised would be used to help the business on its quest to "become a household name" within the grocery sector.
"Our growth strategy is to increase our supply to supermarkets. We got into supermarkets just before Covid and we've been building that organically by building relationships with supermarket merchandisers and managers," Lamason told the Herald.
"We're going to be pouring all of this capital into getting more product out to market from the roastery through our merchandising in supermarkets. We've never had a marketing or design department and so some of this capital will be going into that, which is incredibly important to get our product in front of customers and being visible at supermarket level."
Matt Lamason, founder of People's Coffee. Photo / Supplied
Lamason spent an initial $50,000 - about half of that spent on a small coffee roaster - to set up People's Coffee. Today it turns over about $3m in sales each year.
People's Coffee has two cafe bars in Wellington, and supplies its coffee to 100 independent cafes around the country and 20 supermarkets in the North Island.
Supplying to independent cafes makes up its largest portion of business currently, followed by grocery sales following a strong uptake in sales over the past two years.
"[Grocery] is very dependable - week-to-week you don't get the slumps or people buying you out - the competition is still strong but we're not having to deploy huge amounts of capital at coffee machines and grinders and training," said Lamason.
"It's a very turbulent market working in the wholesale independent cafes sector."
People's Coffee moved into its new Newtown roasting facility in November last year - it is four times the floor space of its former site. The site offers tours and barista courses.
Long term, Lamason said he had plans for People's Coffee to grow its cafe footprint overseas.
This would not be in the immediate term, but an aspiration, he said.
"Margins are tight in retail, it has been tough for cafe owners, and so in this raise we are not going to be opening another bricks and mortar location other than having a coffee bar at our roasting facility in Wellington."
Inside People's Coffee's Newtown cafe in Wellington. Photo / Supplied
He said working in retail had been made harder since the onset of the Covid-19 pandemic. "It has been tougher in the last year, in the last traffic light system, than it was in lockdown in terms of numbers but for us it is so important to be front-facing; this is how people learn to love us by going into our stores and discovering us."
Sales in its cafes had recovered to pre-Covid levels and Lamason said he was now "confident" in retail and excited for the future.
"This [raise] for me just feels so true to the brand. Starting People's 20 years ago and doing it through friends and community and now be able to go to the market and the people who have been supporting us and asking them to help us grow ... the other options are quite challenging for our brand and values to go to private equity or bigger money, so it feels really exciting to be able to go out like this and be seen. There's not a lot to hide in a public raise experience. I'm excited people get to own a piece of People's and to see how the public responds."
People's Coffee employs over 30 staff. The business was considered ahead of its time selling organic coffee beans and being sustainable from day one when it started two decades ago.
