July 12, 2019
The Spoon
Coffee bean subscriptions are all the rage right now, but Bonaverde, originally a coffee roast-grind-brew hardware startup, is taking the hype to a whole new level: a flat rate subscription for cups of coffee brewed in over 100 real-world locations in Berlin.
The team’s newest project, the Urban Coffee Club, offers Berlin coffee lovers unlimited cups of coffee in more than 100 locations in the city for a flat rate of €10 per week.
To learn more about the origins of the Urban Coffee Club (UCC), as well as how it makes sense economically, we reached out to Alex Greif, COO at Bonaverde.
“Like Spotify, we offer unlimited coffee at a flat rate,” Alex said. “But like Airbnb, we don’t own any of the locations that serve the coffee, we just connect them to the service and let consumers choose which one they’d like to go to.”
Here’s how it works: Bonaverde partners with “coffee corners”, which can be cafes, restaurants, yoga studios, bookstores, or anywhere that has existing coffee equipment. Bonaverde sends those corners roasted coffee beans for free—much of it from Bonaverde’s own supply chain, but also from local roasters who offer free beans to the service to get their product in front of consumers.
Each week, Bonaverde selects 5-10 different coffee beans from their own stash and partner roasters, then delivers them to coffee corners across Berlin according to predictive models that anticipate demand. Each location is given one type of coffee bean, and it’s never the same week-to-week. Consumers then have the power to look at the app and choose a coffee corner according to proximity, ratings and reviews, or the bean offering. Coffee corners simply brew the beans and hand it over to the UCC customer.
“In Germany,” Alex continued, “it’s common for businesses to provide some kind of side service that attracts people. Often it’s DHL package drop-off points, but that takes a lot of storage and you have a DHL employee in and out every day. With coffee, it’s totally free, it takes virtually zero extra storage, and coffee corners can have a steady flow of relevant customers stopping by.”
The club’s coffee corners, for the most part, do not run their business on coffee sales, but food. The hopes are that UCC customers will come get their coffee, then stay for a sandwich or treat. And, if their experience is positive, maybe they’ll come back in the future.
It makes sense for the coffee corners who are happy to have additional foot traffic. It makes sense for local roasters who want to get their coffee in front of customers. But does it make sense for Bonaverde? At just €1 per cup of coffee on the Lite plan, do the economics work out?
“The idea is that creating an economy of scale—buying coffee for over 100 locations—brings down the cost and makes it work,” Alex said.
He also explained that most customers don’t actually drink a cup per day in cafes. Many of them have a cup at home or at work. Paying €10 per week for unlimited coffee, for many people, is less about the certainty of getting coffee at a great price, but the ease and availability of the cafe experience.
The Urban Coffee Club has only been live for just over one week, but there are already over 200 paying members. Alex will soon have promoters on the streets telling people about the club, and he’s eagerly signing on new coffee corners in different neighborhoods of the city.
Alex has his sights set beyond Berlin for 2020: “We want to prove it here, then build it into a platform solution where we can basically add in the roasters, add in the corners, add in the users, and then take it to any city in the world and replicate it.”
The Urban Coffee Club has a way to go before it’s ready to dominate Europe’s coffee market. For one, the signup experience in the app has been so problem-ridden that at a pop-up UCC booth, they had to full-on embrace how bad it was with a display that humorously said “Home of the *worst* signup experience”. Bonaverde’s also looking for investor partners to give them the capital they need to continue growing. And with only a week in the books and zero precedent for this kind of business model with coffee, it’s still unclear how the model will fare long-term.
But after having created the Urban Coffee Club completely from scratch—from raw idea to 100 coffee corners—in just six weeks, who knows? Maybe it won’t be long before we’re all paying a flat rate for coffee after all
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