How Blue Bottle Went From A Coffee Cart To A $700MM Valuation
Blue Bottle Coffee offers drip coffee that costs roughly $5 per cup at more than 75 cafe locations around the world. The company touts its high-quality single-origin, freshly roasted artisanal beans. Based on Nestle's 2017 purchase of a majority stake in Blue Bottle the latter has a valuation of more than $700 million.
Before he founded Blue Bottle, James Freeman was a struggling classical musician roasting his own fresh beans as a hobby. Since he was obsessed with drinking the freshest cup of coffee he could find he purchased raw, green coffee beans before heating them himself. Freeman felt that most retail coffee chains over-roasted their beans.
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How Blue Bottle Went From A Coffee Cart To A $700MM Valuation
Why are people so suprised about $5 a cup? Hello starbucks, dunkin, even local coffee shops have beem doing this for years.
Yea this feels like it was filmed in 2000. 5 dollars a cup was news then when 2nd wave Starbucks was a thing.
Hello. I'm in Australia and pretty much every coffee if made like that - and if your paying $5 your being ripped off. I've never seen a coffee made in this country that isn't made using roasted beans
Lol yes. But starbucks is garbage now days.
That's more than what I pay for 200g of delicious mild roast beans at the local roaster...
There are roasted beans and then there are roasted beans. After all, instant coffee also is made from roasted beans - how about charging $5 for a drink made from this kind of coffee beans? I'm not advocating BB (to me $5 seems a lot for any coffee) but some coffee deserves higher price (some of specialty shops) and some just isn't worth drinking (pretty much anything at fast food chains etc.)
The creator of Blue Bottle is a real life squidward! (Clarinet, miserable at former job, his general demeanor)
Agree 😁
this is my first like of a youtube comment ever. so true, so true.
Truest thing I've read in a while 😂
@- ELITIST? He was a struggling clarinet player who ended up doing this somewhat out of desperation (and starting off in debt, not parents paying for it or having vast "elite" savings) and the combination of getting it right in terms of making the coffee more appealing than the other options and luck resulted in this. That said, he's got a smug Bay Area persona, which I assume is what makes you think they're an "elitist."
@@the_letter_b It's more that he ripped off critical ideas from my old boss at his 3rd wave cafe, Japanese "Kyoto" Ice Coffee on tap, cold brew methods, tiny latte art in a macchiato cup etc
The one dude says it's crazy to pay $5 for coffee but he has a Louis Vuitton bag lmao
ya boy tyrone ikr :)
It's called a satchel. Indiana Jones wears one.
well therotically he could make money on his bag in the future selling as vnitage as there is a market . when has a 5 dollar of coffee ever gave you the ability to even make money
Fake probs
Emmanuel Emman Assuming I had the money to purchase a Louis Vuitton bag, I could go buy a $5 coffee and invest the rest of the money then actually make money and probably make the $5 back instantly
New Yorker: 5 DALLAR COFFEE? WHAT?? Also New Yorker: *lives in NYC*
Colton Reed no one who does an interview in times sq is a new yorker
They're in Times Square. Most of the people walking around there, especially on weekends and holidays, are tourists.
Some of us don’t have a choice haha
Also New Yorker: *third Starbucks run*
90% of coffee in NY is $5. ...if you think it’s weird to spend $5 for a cup of coffee in NY you are probably not a NY or you only like DD or McDonalds coffee which both are quite disgusting and does not reflect a good/decent cup. Even Starbucks, which is pretty much the standard, is $5+.
“And i hate myself perpetually “ ... “until i finish the cup of coffee”
Then you reluctantly shell out for it again because it was really good and you want another. Repeat until broke.
Don't focus on your competition, focus on your customer, this guy nailed it.!!!!
CNBC: “...and that’s a $5 cup of coffee” Graham Stephan: REEEEEEEEEE
True
Omg I just clicked on this video after his 😆😆
Throngdorr Mighty he does financial videos. My favorite are his fellow millennials reaction videos.
Elin Winblad $5 coffee would shortcircuit that boys brain considering that he doesn’t spend more than 20 cents on a cup of coffee
He would have an aneurysm if he saw such a charge in his credit card statement
They ruined it when they mentioned nestle. Couldn’t possibly choose a worse company to be partner with
Coyld you explain that to me ? Thank u
El mahdi El bouchtili kzhead.info/sun/drSCdcWFZ6Gkamg/bejne.html
Yeah right. The biggest food company on earth has issues with bad company policies (who could’ve thought considering that size) and therefore can not be partnered with. Not.
Could’ve been Caterpillar
AMEN
That man seriously hold his cup of coffee up for the whole interview.
Dhanang Wibowo he’s advertising 😉
G
He loves his coffee. 😆
I love my first cup of coffee in the morning. It’s the most enjoyable time of the day. I definitely look forward to it.
Yeah, a bit too obvious...
2019 Business Model 1) Attach a moral goal like climate change, global warming, etc. 2) Make a minimalistic product which is basically the same thing in minimal packaging and less options. 3) Charge premium for no reason. 4) Show your company is exclusive but actually sell the same thing. P.S. Earlier companies would stand out by making different products and ideas nowadays companies just do the same thing but try to project themselves as standout e.g. Supreme
Hit the nail on the head
Yeap, same garbage attach "organic, sustainable, ethical, and...." voila, sell it to whites at a premium.
that is ssome high degree critics.
Also be located in the bay area
This is why quality went down. Everyone became a LARP.
"Clarinetists don't accumulate a lot of wealth". Haha! Love the look on his face as he said that
"it was a dead end alley way that smelled like pee" LMAO too real, sounds exactly like SF
...and not a single minute was spent on what made bluebottle coffee actually good
this is cnbc.. cant expect quality journalism
bout the last 40 seconds. spend more time/ sell less garbage
The video was not about what made it good it was about the growth of the company not the quality of there product.
This is the dumbest comment I read today. The title literally says "How Blue Bottle Went From A Coffee Cart To A $700MM Valuation". It didn't say what makes Blue Bottle coffee takes good. It's talking about how the business grew stupid.
dont the founder himself said that their coffe focus more on the freshness?? isnt it the reason? what else do you want? secret recipee?
Such an inspiring story. He took on so much risk at the start and believed in an idea that was not world changing and subtle. I have been to blue bottle and the price kinda hurt but the coffee was so good and honestly the brand is on point and their stores are beautiful.
I agree with you. His determination was something I have to admire. But 5 $ for a single little cup of coffe? Hah, never.
The reason why they were able to achieve what they have is 100% in the management. Anyone good mom and pop Coffee Shop can produce good coffee.
Except they never do.
Totally agree. You can find them coz they put their heart and soul into it.
Yes 100%. It's really critical to be managed and branded well.
@@brotendo problem is creating consistant quality in every restraunt
The whole of Australia is 3rd wave coffee. Unless you go To a corner store you cannot get anything less than $4.50
Cameron Schroeder sounds like my kinda country.
You must be going to the wrong places. Where I go it's $3.20 for a medium late.
And those prices are Australian dollars... Cheaper again against the USD
@@traveller_andrew Exactly.
Go to 7/11. $1 coffee
Lol why is this the first time I’m hearing of this brand 😂
You have to live in the Bay, LA, or NYC to hear about it
@@marlin7699 Pretty much.
They open shop in Japan and Korea. Why not China, HK and Singapore. Europe and Australia are out becoz they’ve got their own local established brands.
Yeah, no blue bottle in Seattle
@@DerekTYWu Starbucks has too much of a monopoly in seattle
Pretend to care about the world, over charge people for basic things, and then sell to a giant. Great business model
I didn't hear him mention the first. 2. These coffee shops are in cities with much higher minimum wages, and the focus on quality vs quanitity makes their product more expensive than your average coffee. You obviously haven't tried their coffee.
He never said he cared about the world and it's called market pricing. Things are worth what people are willing to pay for them, and obviously people in big cities are totally fine with paying more for his coffee. It's no different than any other luxury brand.
Specialty roasters aren't overcharging. There's a real (and obvious for anyone who's ever tasted it) difference between stale, overroasted commodity grade coffee and fresh, well roasted specialty grade coffee. Roasters charge more because it costs them more, not because they're making a huge profit fooling people into buying the same thing for a higher price.
First I thought your comment was compelling. Then I read Alejandro's comment and thought the opposite. I compared bluebottlecoffee.com to starbucks.com and noticed only one had a "social impact" tab. (Thus only one is pretending to care about the world) Then I thought about the kind of coffee I drink. Nestle instant coffee. (Which is much better than dunkin donuts ground coffee which tastes like coffee mixed with orange juice and yes I have mixed coffee with actual orange juice and drank it before and I don't recommend it.) If bluebottle sold out to nestle, then bluebottle is now the moral equivalent to nestle. So I went full circle and now agree with you again. bluebottlecoffee.com : No sign of pretending to care about the world. (BUT sold to nestle) starbucks.com : "Social Impact" tab. nestle.com : "Our Impact" tab.
Exactly, notice where every store is physically located at too... major metropolises filled with higher wage earning idiots
Graham Stephen’s 20 cents coffee. Freeman conspicuously drinking his latte at his answer somehow made awkward moments. Lol. Funny.
m.kzhead.info/sun/p9qFZKp-aZ6Doa8/bejne.html
Ha, another GS fan. Also yeah, him drinking that cup of coffee was awkward af
Yeh graham
This guy is so relaxed...sipping that coffee like martini
Oh, we all knew that Starbucks over-roasted their beans.
It's an open secret! But people still want to be associated with the Starbucks brand for some reason.
Charges the same price as charbucks but the coffee is actually good. Sounds good to me.
Is it me or is starbucks just garbage now?
Gmork13 Starbucks is only 2.50 for a grande moron
@@thecookingnerd8384 Different locations have different prices, it just depends on the rent of the location, the salaries, and a lot more stuff.
He is so interesting to listen to. No corporate hot shot. No pretentious word salad Well spoken and a trained musician
All I got out of this is that I could get decent coffee from roasting in my oven??
Yeah, but you're (probably) lazy. Just like the (majority) rest of us. lol
Somebody knows it better, Graham 😄 You better make 700M than saving on it 🙈
I'm a rich guy myself and even I know $5 coffee is stupid
Rurushu The rich dress poor, meanwhile the poor dress rich.
xD
that 20 cent iced coffee lifestyle hits different
Dont come to Australia, you will lose alot money. Every corner in Australia has this.
@fatcrewz yep everywhere in indonesia, specialty coffee
Like Starbucks? They got roasted
Australian coffee is better anyways.
@@keigop5668 visited America, couldnt believe how bad American coffee is. What's worst, starbucks has monopoly, and there terrible. We make the best coffee.
@@IIIIALBYIIII How about, flavor preferences can be regional and an American coffee might not be bad just different...
3:25 you know that lv bag is fake if he can’t pay 5$ for coffee “It’s crazy to pay. 1000$ for a lv bag when my homie sells them for 20$”
nice observation dude
Or maybe he knows how to use his money wisely, which is why he can afford that bag.
@@GeoGuy388 Nobody wise buys Louis Vuitton - the quality of LV is notorious.
Kenji Gunawan I love the quality. Have been constantly using my bag for the past 4 years. The handles worn off obviously, but the rest of the body is still in excellent condition.
SAY IT LOUDER
The guy is mad chill for someone who's clearly so obsessed with coffee. He must have broken the threshold and crossed over from 'coffeed-up speed-freak vibrating along with time and reality' to a higher consciousness where he is the conductor of those vibrations
He was a clarinetist which instantly gave me a good feeling about him in terms of his humbleness and his demeanor
$5 for coffee is decent. Starbucks tends to raise its prices and they always over roast their beans. If blue bottom beans are still blended fresh w/ the high quality intact. It’s worth the price
You can make your own at home.
That’s true
I think you meant “blue bottle” not “blue bottom” ...... 🤣🤣🤣🤣
Good point.
Both are horrible price, at home coffee cost about 20 cents but you can go more premium around 70 cents to 1 dollar but Starbucks and most big coffee shops have extreme overpricing
I trained at the Blue Bottle head quarters in Oakland back in 2009… I learned the importance of Fresh roasted Coffee and the importance of the right equipment,after working for Starbuck$ for 7 years,I been buying green coffee beans and roasting my own coffee for the last 6 years, I’m very happy with the results, nothing beats the flavor of fresh medium roast instead of overroasted and old oily coffee beans.
Do you use a typical oven?
such an inspiration!!!! im proud of him. hope we can bring the world this joy with coffee
Good for him. Hard work and perseverance paid off. I’ve had Blue Bottle coffee twice. I had to try their two main offerings. Absolutely delicious coffee. Totally worth it if you have it. I cannot allow myself to continue to splurge. I’m happy I tried it.
Blue Bottle Coffee is still the best I've ever had in my life. Every time I'm in San Francisco, I get an almond milk latte at the Ferry Building and it always brings me back to my first heavenly experience with their coffee.
As soon as they said he was convinced coffee companies like Starbucks over roasted their beans, I was impressed and want to try their beans now.
This is something that is widely known in the coffee world.
Interesting. We been doing that in Australia for years.
Mike Australian coffee is the best coffee EVER
miss campos coffee from US
Mike ive always wanted to experience the Australian coffee scene. I heard New Zealand’s good too. How do they compare?
Melbourne is the Mecca for coffee
yeah, this is just normal coffee.
This guy sounds like he needs a jolt of coffee himself.
Seems like he’s on xan.
Sold to Nestlé, so that's a no from me.
“Cares about the environment”
Why? Sorry no idea about nestle
@@officialspock Nestle is one of the most unethical brands, if you look up on Google alot of articles about that would show up
He sold to Nestlé for 700 million dollars. Nothing more needs to be said!
So, persistence & perseverance. In addition to believing in your work! All to make the world a better place for everyone to be in
Simple, great quality, minimalism; all I wanted for coffee. I love it!
Good on ya! Glad to see you followed through on your goal and the sell to Nestle was genius.
I buy Ethiopian coffee for 6$ a bag. Why buy a 5$ dollar cup of coffee. 20 cent coffee makes you richer.
Sometimes "richer" means having less money
lots of coffee is Ethiopian. Its easy to grow there
Graham Stephan would be proud.
You're not getting high quality Ethiopian beans freshly roasted by a good roaster for $6. You're almost definitely getting low grade beans that were roasted months ago at that price. It might be good enough to you, and that's fine, but just being from Ethiopia doesn't make it the same.
Theres alot more to coffee than just buying a coffee originated from a single country that can justify $5 coffee.
He looks quirky and pleasant, I wanna listen to him in a podcast format
I do not
It was great to watch this. I’ve been a customer since their early days when they had a coffee cart at the San Francisco farmers market 20 years ago
What a lot of people fail to acknowledge is that when they pay 5 dollars for a “cup of coffee” you’re also paying for the labor and research that went into making that coffee. The farmers in various ‘coffee countries’ (Ethiopia, Columbia, Brazil etc) put in so much work growing the coffee shrubs, picking the coffee cherries, separating, sorting, and washing the seeds from the cherries (coffee bean) which are then sold to different exporters around the world and shipped to many different roasting companies. During roasting there’s a lot of data analysis and variables (specifically temperature and time) that coffee roasters adjust and tweak in order to get the flavor profiles they want in their coffee ‘beans’ just right. Most ‘third wave shops’ will more commonly have light to medium roasted coffees which generally produce more complex flavor profiles with a lot of fruit and citrus notes as opposed to darker roasts which tend to lean more towards chocolate notes and overall less complex flavors. Then baristas that work in the shops are trained to make sure that not only do they know ‘how to make’ the coffee but that their palates are developed enough that they also know what they’re tasting in their drinks whether that be espresso or ‘regular drip coffee’. Granted, it’s disheartening that there are so many shops that open up for the sake of ‘looking cool’ but don’t put in any effort into serving consistent quality coffee, or businesses like Blue Bottle being bought by Nestle (which I feel is ultimately counterproductive and unethical for the coffee industry as a whole). But the next time you pay for ‘expensive’ coffee at a ‘third wave shop’ just remember that you’re not only paying for a higher quality drink, you’re also supporting baristas trying to make a living/career, roasters that are always working to provide consumers with better tasting and more interesting flavors, and most importantly, farmers in less developed countries that put in so much work growing coffee to support themselves and their families.
Not really, you are paying more to the last person in the distribution chain. Coffee farmers are underpaid eitherway.
This is just absolutely false lmao
Colombia* why is that hard to get it right?
20¢ iced coffee. If you know where that's from...thats just wow.
If you don't get this reference I can explain it in full detail.. *after you hit the like button*
@@raylazuli hahaa
Lmao though he said it was now 30 cents
If you *STILL* don't know, well Graham Stephan. You're welcome.
I did the math it's a little over 20 cents depending upon how much creamer he uses.
"Semi expensive coffee is simply just not recession proof" Gosh she really predicted 2020 well
I’ve just started buying organic, single origin direct trade beans from the grocery store and online. Depending on how expensive the beans are my costs typically range around 25 cents a cup for the grocery store stuff and 50 cents a cup for the online stuff that’s fancier and has a roast date on it and everything. Blue bottle coffee is cheaper for you to make at home yourself, but even just the beans are really expensive and I can’t imagine they’re really that much higher quality
Tons of value. Thank you!🔥
5:06 turns out expensive coffee is recession-proof smarty
If Blue Bottle will have a branch here in my country, I would gladly support it. The owner is so down to earth and he work so hard to create his company.
What about supporting your local business?? Why support giant business.
@@onraj9mm coz she does not like her local business which no news media bother to put an ads for them. what a awesome world we live in
@@onraj9mmbecause I like blue bottle’s coffee more
I rememer when they popped up at the Ferry buil😊ding farmers market. I actually stood in line to get a cup and was rolling my eyes at how they slowly poured the water over the grinds. So nerdy! And expensive. But it was good coffee!
Just sold my first 5lb of coffee to a local shop here in Pittsburg KS! :D
I LOVE BLUE BOTTLE!!! Its worth every penny. I am also confused why people are surprised that a cup cost around $5 as other brands that are not good are around the same price.
Peet's coffee is way superior on every aspect and I csn get a nice cup of freshly brewed for less than 4.
😮 That's an ANTI-GRAHAM video 😮
lol
HAaaaaaaaa... Let's send this to him.
Lmao
I was thinking of him 😂😂
I was heavy into coffee culture and worked at the mother ship of a big franchise for a long time and never heard of this company. I'm located in the Midwest, so it's interesting how cultural boundaries are even separated by state lines.
Thank you finally there's a company that gets this Starbucks and McDonald's coffee see the same to me they both taste just over roasted and burnt
Miley Queen no they taste good
Graham’s 20 cent coffee is the 4th wave of coffee, coffee for the rich (or soon to be with all the savings)
Somehow i like your comment. I have enough money for the rest of my life. And yet i have a stable job. I drink two tablespoon of boiled old fruits or old veges with sugar. Cost $0.10 for the sugar. The old fruits and veges are leftovers. Coffee cause osteoporosis. I dont understand why pp pay $5 to lose their backs and knees and bones. I totally enjoyed quitting coffee. I enjoyed the withdrawal symptoms. I slept 11 hours of daily deep sleep during the withdrawal symptoms.
Lmao
Vs Graham ! 😂😂😂
"I look to companies for inspiration, not competition" Nice👍
The lady thats saying when the economy slumps people will abandon 3rd wave coffe for a cheap caffeine fix doesnt understand coffe love at all, its not about a caffeine fix at all...its about a delish beverage vs dunkin donut trash.
Blue Bottle deserves its success. Like any good chain, it is very consistently great quality in service, ambiance, and...coffee! For me, the defining product that demonstrates this is a a single origin light roast espresso shot. No milk, no sugar to cover up mistakes....very few places can get this consistently right and delicious, because it takes knowledge, skill, training and commitment to excellence.
But it would be good with a reasonable price. 5 $ for a single little cup of coffe? For me, never.
Or you could just buy organic, shade grown, bird friendly, single origin, fair trade coffee beans, grind it yourself, and make your own espresso in a way more controlled process and save hundreds of dollars.
@@guppygb6078 That’s what I do. They’re still better than any other place of similar scale I’ve tried at in-shop espresso
It’s sad they didn’t talk about what makes it an artisanal coffee. There’s another documentary where they show how blue bottle sources their beans.
This is a beautiful story. I too have racked up and leveraged debt to make my business grow, and i know it is paying off as it is :)
James Freeman great achievement congrats and keep roasting
Even after being purchased by Nestle, they still taste great. I always love my consistently good cup from BB
Costa coffee is owned by Coca cola. They still feel the same
Whys this dude drinking his own coffee during his interview... take it back a notch
I rarely have my coffee straight black but their pour over is so good that it doesn’t need anything else!
😂🤭when they were like “cans starting exploding” and his reply was “that’s a sad one because the coffee was preserved magically.”😂😂😂🤭😂
its shocking to see that most coffee consumers doesnt know how better freshly roasted coffee can be
having worked at many top level coffee shops, my blue bottle experience was by far the best.
Funny how people thought $5 for a coffee was crazy just 4 years ago. That's pretty much standard now in 2023.
Tried blue bottle for the first time about a month ago. Life changing.
Roger Sterling really knows his coffee.
"I think it's crazy to pay $5 for a cup of coffee!"..... while wearing a $45 t-shirt =)
I didn't know Squidward has established Coffee business in Bikini bottom
I literally paid $10 that’s including tip for my cup of coffee today! Lmao. I normally don’t but I found this lady that literally sells coffee from her house and has a coffee bar business. It was absolutely delicious.
7:37 "Even Starbucks got in to third wave coffee" -The "barista" is spilling out all the water. LOL.
the barista is first rinsing the apparatus with hot water to make sure the coffee experiences consistent temperature, before actually making the coffee
Samsung: Exploding phones Bluebottle: Exploding cans
1:35 shows he is a true coffee snob. I love it!
I like that guy, and i appreciate his passion
I’m not a coffee snob but you get what you pay for. Personally I can’t drink the cheap stuff and would rather pay $5 for a good cup.
Sipping his coffee to the bank.
Insane valuation
I stoped the video to make my latte. Couldn't resist.
The first guy complaining about price has on a Louis Vuitton bag 🤦🏽♂️
Kudos to the founder hard work and consistency really pays off. I wish I could invest in this niche coffee brand.
i love how hes so soft spoken
blue bottle coffee is great ive bought a can of it from whole foods a bunch of times. the quality of the coffee makes the price worth it.
A miserable clarinet player, Squidward IRL
Isn’t that the exact same price of a Starbucks coffee cup?
@Shay Monte' nah this is is in USD u prolly live in another country
$5 for an espresso based beverage, like a mocha or a large latte. About three dollars for drip coffee
issie em 3 dollars at Starbucks?? Not in this world honey
I was thinking the same thing too.
I stumbled on this place in Brooklyn in NYC and found it to be amongst the best two cappuccinos IV had worldwaide, the other being the inconsistent 200 degrees coffee. Had no idea of the brand size. The taste is superior
Always enjoy Blue Bottle in NYC
I’m more into Graham Stephen $.20 cent coffee!
Throngdorr Mighty you don’t know who Graham Stefan is? you should look it up
People are too easy to be influenced, I bet more than 50% of the customers just buying it for the hype/brand.
And thats whats happening these days...people buy stuff or drink coffee according to social media feeds
msnc494 Anyone that says this has never tasted quality espresso 100%.
Hipster idiots with not a $ to their name that’s who gives them the $5
Sure. Why not? If it makes you $700M man...
@M True, but from my understanding that requires a pretty large investment. Espresso machines and grinders are expensive, and some people would rather pay the $5 than spend $500-$1000 on the machine and grinder then have to purchase the actual coffee.
I didn’t even know about this brand until now
Why not make drip coffee at home myself, hot water: same , coffee: same
You know the economy is booming when you are able to sell $5 cup of coffee.
Trump baby
Tien Trinh bro trump wasn’t president in 2010 when this company was able to expand.......
Annnnnd it’s gonna crash, b/c we’re waaaaayyy overdue for a recession. The recession is happening in the end of trumps last year, next year, wait.
Thank you Obama for guiding us out of a recession and leaving Trump an already booming economy.
Trump the great white hope!
I just came to know about blue bottle through this video
Excellent video, thank God for good coffee ☕
I am an avid coffee drinker and this is literally the best tasting coffee I ever tasted.