On Starting An Organic Coffee Brand With Only $7,000

Matt Bachmann

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Published: November 4th, 2020

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Matt Bachmann

Founder, Wandering Bear

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Wandering Bear

wanderingbearcoffee.com

from New York, NY, USA

started March 2014

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Employees

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Discover what books Matt recommends to grow your business!

The Ride of a Lifetime: Lessons Learned from 15 Years as ... Robert Iger

Mission in a Bottle: The Honest Guide to Doing Business D... Seth Goldman

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Hey! I’m Matt Bachmann, the CEO and co-founder of Wandering Bear, a direct-to-consumer and wholesale coffee company specializing in extra strong, surprisingly smooth, and sustainably packaged organic coffee.

Our flagship product is the Extra Strong Straight Black Cold Brew – each glass is equivalent to two espresso shots or 150 mg of caffeine; in our seven-year-long journey to perfect the best-tasting, strongest coffee products on the market we’ve expanded our offerings to include flavored cold-brew, Coarse Ground Coffee and most recently extra coffee pods that are not only the best tasting on the market but the strongest caffeine content.

Uniquely packaged, Wandering Bear is for coffee drinkers of all ages whether they’re at home, at work, or on the go. You can find Wandering Bear in thousands of stores around the country and just about anywhere you look to shop for food on the internet (including Amazon and our site).

What's your backstory and how did you come up with the idea?

Coffee has always been a key part of my life. For as long as I remember I loved the taste, the smell, and just everything about it. The idea for Wandering Bear was started when I met Ben Gordon, Co-Founder & President of Wandering Bear, in grad school. I walked into the classroom carrying a travel mug of homemade cold brew coffee and there was Ben, sitting with a leather-wrapped mason jar filled with his own homebrew.

Looking back on the way we used to make decisions versus the way we do now, the greatest learning that emerged is how to make decisions.

Shortly after meeting Ben and connecting on our love for cold brew, we held a competition to see who could make the strongest coffee, which led to creating the perfect recipe for our cold brew. Shortly after perfecting the recipe, we decided to launch Wandering Bear in 2014, hand-delivering cold brew to offices across New York City and embarked on a seven-year-long journey to perfect the best-tasting, strongest coffee products. Fast forward to today, Wandering Bear products can be shipped to doors nationwide through subscription, found nationwide at retailers such as Kroger and Whole Foods, as well as Amazon, FreshDirect, and Thrive Market.

Take us through the process of designing, prototyping, and manufacturing your first product.

Ben and I were in grad school and there was a Shark Tank-style pitch competition in front of a bunch of Venture Capitalists that we entered. To get to pitch, you had to make and get a certain number of likes on a Youtube video… so we made a little cartoon and hustled for 2 weeks to get everyone we knew to watch it. Linked here. Fast forward a couple of weeks, we won $7,000 and got to work. When we started, we didn’t know what we didn’t know. We just started experimenting. We had been making cold brew at home for a while at this point and had done enough experimentation to know what levers we needed to pull, at a small scale, to create the extra strong, smooth coffee we were now trying to create at “larger” scale. Larger, because the jump we were making at the time was from 5-gallon buckets to 55-gallon drums. Anyone who has been involved in the production of cold brew will be able to relate well to this stage. As an aside, it was at this time we made up our “rule of 10”, which was that any time we were going to disrupt the production process that was working for us at the time, it would have to be to 10x the scale we were working at. True to form, our next step up was to 500 gallons and a cold brew production for us now runs multiple 5,000+ gallon tanks. It’s been incredible to see. But back to the story.

Our goal that first summer was to get to a product we could sell as quickly as possible. After pouring the first couple of batches down the drain and feeling bad about ourselves for a few minutes, we finally got it right. With parts that we bought at The Home Depot and a pump that we borrowed from another beverage company, we rigged together our first bag-filler and filled up the very first batch of 96oz boxes. If I recall correctly, it was 21 boxes and a ton of waste. The boxes were marked with a two-week refrigerated shelf life. We rented a Zipcar Honda Odyssey and started driving around Manhattan dropping off one-box samples to a list of friends and contacts at offices around the city. That was the second week of June 2014. We made our first sale on June 23, 2014, and delivered that product out of our second ever production run.

Getting started was all about relationships and getting folks to take a bet on a small business, a good plan, and a dream. From boxes to bags to production space, our goal was to stay as lean as possible. We were making one week of inventory at a time, buying maybe four weeks’ worth of packaging at a time, and renting our initial production space by the hour.

Ben and I were doing everything. I remember the first big unlock in our business was around six weeks in when we realized we could cut our “production” time in half by hiring someone to clean and sterilize equipment alongside us while we were producing rather than waiting until the end of the shift to do all the cleaning ourselves. Every weekend that first summer and most weekends for the next year were spent in the plant. It’s remarkable our girlfriends at the time actually became our wives after the hell we put them through in those early days. Some photos and links below highlighting our beginning process.

Mashable video.

Describe the process of launching the business.

We had $7,000 to start. We had to be super-efficient. We decided to try to sell to offices on a pre-paid 8-week subscription. It worked. In that first summer, we signed up 50 offices and went back to school in the fall running a real (small) business. Grad school quickly became the side hustle. Our vision for Wandering Bear has always been to make our extra strong coffee a home and office staple item. We had started to make traction in the office space (where we would later become an industry leader), but we needed to crack the at-home occasion.

We were a short-shelf-life refrigerated product at the time, so the direct to consumer business model that is now thriving for us was not viable at the time. We looked to early partners like Fresh Direct to help us solve this early part of the puzzle. In September 2014, in about of entrepreneurial frustration that my emails were going into a black hole, I showed up at the Fresh Direct headquarter office with two boxes of our cold brew. Acting as I belonged, I walked past security and introduced myself to the receptionist upstairs, asking if she was a coffee drinker. She was, and we enjoyed a cup of Wandering Bear together. I then asked if she’d put the second box on the desk of whoever at Fresh Direct would buy it. She did. A week later I got an email inviting us to present the product to their buying team that October.

We launched on Fresh Direct in January 2015. They were our first large wholesale account. It was a success right out of the gate with their early-adopting customer base. That early success story was a critical part of our narrative in those first years and in the years to come. They are still a critical partner in our business.

Since launch, what has worked to attract and retain customers?

The journey is the same for all brands: awareness > consideration > trial > purchase > repeat. For us, in the early days, offices were our awareness driver. We built an inside sales team, called on offices, got our product in the fridges or on the floor in kegs, and leveraged that brand awareness to drive sales in other parts of our business (online and eventually in stores).

Now, eCommerce and digital tactics to efficiently drive awareness (email, social, paid ads) are core to our strategy and the real unlock for us has been leveraging our email and social channels to build out our engaged community to drive reorders by delivering specific value (discounts, swag, etc.) at critical points in the customer journey.

Amazon is a key part of the strategy and we’ve structured our DTC experience so it “plays nice” with Amazon and so that we’re able to be completely agnostic as to where a customer decides to buy our products. Indeed, we’ll often push customers to Amazon if that’s what’s going to be better for them. The key is understanding that Amazon functions as a Google search bar for products for many consumers. With that, you need to view your customer acquisition and spend strategy supporting Amazon the way you would look at search and with the tactics you’d use to drive SEO.

How are you doing today and what does the future look like?

This year has brought many changes to our business. Before the pandemic, our business model was focused primarily on the boxed multi-serve cold brew for offices. As workers transitioned to home offices, we pivoted strategy to make Wandering Bear more useful to our customers from the comfort of their own home. In August, we launched Extra Strong 96 oz. Boxed Cold Brew made perfectly to fit in any fridge, Extra Strong Coarse Ground Coffee for customized cold brew at home, and certified-recyclable Extra Strong Coffee Pods that are the strongest caffeine content available on the market. For those who still prefer on-the-go single-serve cartons, we have those too, and they’re recyclable, phenomenal at preserving flavor, and resealable. We’ve completely refreshed our site, and are dedicated to servicing the at-home coffee consumer by offering more product, shipping, and subscription options.

We’re excited to continue to innovate on our extra strong coffee products and consumers should expect new releases in the coming months as well as continuous upgrades to the online shopping experience, including the addition of much-sought-after swag to the store soon!

Since April, our online sales have increased by 1,112% vs. the same period last year. We’ve completely reinvented our business in the face of the pandemic and it’s incredibly exciting. Additionally, our email list has quadrupled in the last 90 days since beginning to focus on our eCommerce site.

Through starting the business, have you learned anything particularly helpful or advantageous?

There is so much to unpack here. When you’re starting a business, everything is learning. When it’s your first business, regardless of how many companies you’ve worked in, with or for before, multiply that by a factor. Of course, there have been mistakes, good decisions that felt bad at the time, and bad decisions that felt good, both seized and missed opportunities, good luck and bad. Looking back on the way we used to make decisions versus the way we do now, the greatest learning that emerged is how to make decisions.

In the beginning, everything feels major and everything seems worthy of deliberation and analysis. False precision and over-analysis is a real thing, a red herring and sometimes a booby trap that can delay your ability to seize opportunities that are right in front of you. The learned skill is being able to quickly identify decisions that require speed for impact and effectiveness and those that require deliberation and analysis for more thoughtful execution. As a general rule of thumb, we believe that if something is relatively reversible and inexpensive, then we’re better off trying quickly, learning, and adjusting course if needed. If a decision is irreversible, slow, or hard to change, or generally expensive, we force a more rigorous decision process (analysis, multiple points of view, scenarios, etc.). In general, no one has the answers if you’re doing something that has not been done before. The best you can do is learn from the mistakes of others, quickly and cheaply make a bunch of small mistakes of your own and do your best to identify where the big ones may lie so you can avoid them in the future.

What platform/tools do you use for your business?

Our favorite business toll is Shopify Plus. Wandering Bear’s online store is built on Shopify Plus, and I would give that as a recommendation to anyone launching a DTC brand today. Save the time, save them money, save the cycled debating where and how to build. Just do it on Shopify Plus and move on.

Other tools we would recommend include: Gorgias for Shopify-integrated customer service, Klaviyo for email marketing, Shipstation to integrate 3PL shipping facilities, Supermetrics for data aggregation, Data Studio for data visualization, and Google Sheets / Slides / Docs for everything.

What have been the most influential books, podcasts, or other resources?

The most influential books I’ve found helpful are Ride of a Lifetime by Bob Iger in particular for his POV on negotiation and self-management, Mission in a Bottle by Seth Goldman and Barry Nalebuff if you’re building a beverage business, 10% Happier by Dan Harris for an accessible POV on the mindfulness trend, These Truths by Jill Lapore for a POV on the messiness that is the American story and The Great Influenza by John Barry to put the current pandemic in perspective to the last big one.

Advice for other entrepreneurs who want to get started or are just starting?

One piece of advice I would give to entrepreneurs looking to get started or just starting is to hire a bookkeeper. As soon as you have revenue for sure, and perhaps as soon as you’re spending money out of your company bank account, you should invest in hiring a bookkeeper, ideally one that knows your industry. They should be fluent in QuickBooks and able to set up a good Chart of Accounts with the right level of detail. Getting this right on day one will save you countless hours and cost down the road. You’ll also have the benefit of real information you can use to make decisions in your business.

Additionally, I would suggest just to get started. Less talking and more doing; early on this was sometimes a struggle for Ben and me, but I found the best learning you get is by doing and the power you hold as an early-stage company is the ability to test things quickly and cheaply without huge repercussions. That’s often your only advantage. Use it.

Lastly, I would suggest prioritizing rest. This is not always easy given the amount of caffeine I consume, but I’ve found that there’s very little a good night’s sleep can’t fix.

Are you looking to hire for certain positions right now?

While we currently don’t have any open roles that we’re looking to fill, we do love talented people who are doing cool things and who love coffee. Especially cold coffee. If someone has unique passions or talents that they could bring to our team, we always encourage them to drop us a line on our careers page.